IMF国际货币组织全球-Benin_Fifth-Review-under-the-Extended-Credit-Facility-Arrangement-Request-for-Extension-and-Request-for-Modification-of-Performance-Criteria_93页_1mb

IMF Country Report No. 19/398: Benin - Fifth Review Under the ECF Arrangement

Core Content Overview

This report outlines the results of the Fifth Review under the Extended Credit Facility (ECF) arrangement with Benin, including the approval of a US$22 million disbursement and a four-month technical extension. It also addresses the modification of performance criteria and the progress made in economic and financial reforms.

Key Points

Program Implementation

• The program's implementation has been very satisfactory, with all end-June 2019 quantitative performance criteria (QPCs) and the September 2019 structural benchmark (SB) met.
• The 2020 draft budget includes a fiscal adjustment of 0.25% of GDP, aiming to reduce the fiscal deficit to 1.8% of GDP, below the WAEMU regional norm of 3%.
• The fiscal deficit for 2019 was significantly lower than initial projections, at 0.4% of GDP, due to strong revenue performance and controlled spending.

Economic Outlook and Risks

• GDP growth for 2019 is expected to slow to 6.4%, down from the initial projection of 6.7%, due to the Nigeria border closure.
• Inflation is projected to remain below the WAEMU 3% ceiling in the medium term, supported by cotton production, construction, and port activity.
• The current account deficit is expected to increase slightly from 4.5% of GDP in 2018 to 4.9% in 2019, but improve in the long term due to strong exports and scaled-down public investment.
• Risks to the outlook are tilted to the downside, including the potential for social unrest due to 2020 local elections, prolonged border closure, unresolved banking sector vulnerabilities, regional security risks, and global protectionism.

Debt Sustainability

• The public debt-to-GDP ratio is expected to stabilize in 2019 after years of increase, thanks to lower fiscal deficits, strong growth, and no new guarantees.
• The debt sustainability analysis shows that while the debt-to-GDP ratio has been revised downward due to the rebasement of national accounts, liquidity indicators have not improved significantly.
• The external debt share has increased to 60% of total debt in 2019, up from 40% in 2017, raising risks such as exchange rate volatility and rollover risk.
• A new debt management strategy (2020–2024) is being developed, targeting an external debt share of 55–60%, with the aim of prudent debt composition and enhanced management capacity.

Fiscal and Revenue Policies

• The 2020 budget includes an ambitious tax effort, with a revenue mobilization target of 0.5% of GDP.
• The tax ratio has been revised down to 11% of GDP due to national account rebasing, which is below the WAEMU convergence criterion of 20%.
• The revenue package includes measures such as income and real estate taxes, mobile payment of TVM, and electronic invoicing.
• In case of revenue shortfalls, the authorities are prepared to adjust capital spending and may consider supplementary budgets.

Investor Protection and Governance

• Benin's investor protection framework has been improved, with the 2020 Doing Business ranking showing an increase of four places.
• The Global Corruption Barometer indicates improved public perception of corruption, with 44% of the population now believing the government is doing a good job.
• The new investment code is under consideration to further enhance foreign investment attractiveness.
• Steps are being taken to upgrade the AML/CFT framework, including increased financial support for CENTIF, better reporting of suspicious transactions, and the establishment of a national agency to manage confiscated criminal assets.

Banking Sector Reforms

• Bank capital adequacy improved in 2018, reaching 8.2% at end-December 2018.
• Credit concentration decreased from 103.3% to 90.4% in the same period, but NPLs increased to 21.6% of total loans.
• The banking sector is being restructured, including the restructuring of two public banks, and efforts are underway to improve profitability and financial stability.

Main Views and Recommendations

• The IMF staff supports the completion of the fifth review, the technical extension, and the adjustment of performance criteria.
• The fiscal adjustment is prudent, with a focus on revenue mobilization and wage bill rationalization.
• The debt management strategy needs to be strengthened to ensure prudence and sustainability.
• The investor protection framework should be enhanced to improve foreign investment and corruption perceptions.
• The banking sector requires reforms to improve profitability and reduce risks.

Key Documents Included

• Letter of Intent
• Memorandum of Economic and Financial Policies
• Technical Memorandum of Understanding
• Staff Report
• Debt Sustainability Analysis
• Annexes and appendices covering national account rebasing, risk assessment, debt management strategy, investor protection, and disbursement schedules.

Summary of Performance Criteria and Adjustments

• The end-December 2019 QPCs on revenue, basic primary balance, and net domestic financing will include adjustors.
• The structural benchmark for 2020 involves the adoption of a tax package, which is expected to yield 0.5% of GDP in additional revenues.
• The 2020 tax package is based on durable measures and is expected to be fully operational by 2022.

Conclusion

The Benin ECF program is progressing well, with fiscal and macroeconomic performance exceeding expectations. The IMF has approved the disbursement of US$22 million, and the authorities have demonstrated commitment to achieving fiscal discipline, debt sustainability, and improved governance. The border closure with Nigeria remains a key risk, but the authorities are prepared to adjust to mitigate its impact. Continued reforms in debt management, investor protection, and banking sector restructuring are essential for long-term economic stability and sustainable development.