IMF Approves $26.5M for Liberia Stability

Liberia’s reform-driven economic recovery received a major boost this week as the Executive Board of the International Monetary Fund (IMF) approved the disbursement of US$26.5 million (about SDR 19.3 million) following the successful completion of the Article IV Consultation and the second review of the country’s Extended Credit Facility (ECF) arrangement.

The decision, announced in Washington on Wednesday, October 1, 2025, brings total disbursements under the 40-month ECF program to US$79.4 million (SDR 57.9 million) since its approval on September 25, 2024.

The new funds are expected to strengthen the Central Bank of Liberia’s (CBL) foreign reserves, helping to stabilize the macroeconomic environment and support fiscal reforms.

The IMF hailed Liberia’s steady progress in implementing policies aimed at reducing fiscal deficits, mitigating debt risks, and building a resilient economy amid reduced donor support.

“The authorities have made notable progress in implementing sound macroeconomic policies and key structural reforms in the first year of their Fund-supported program,” said Mr. Bo Li, Acting Chair and Deputy Managing Director of the IMF.

According to Mr. Li, swift government actions including cutting low-priority spending and mobilizing more domestic revenue have helped safeguard essential social programs previously funded by the U.S. Agency for International Development (USAID), which abruptly ended some large-scale grants earlier this year.

IMF Executive Directors commended the government’s fiscal discipline despite declining foreign aid, noting that a forward-looking revenue strategy is now in place to expand social spending, rebuild fiscal buffers, and reduce debt vulnerabilities.

They also emphasized the need for continued reforms in public financial management, investment planning, and spending efficiency to support sustainable growth.

The Directors further highlighted the importance of mobilizing donor support through grants and concessional loans to address Liberia’s massive infrastructure gap while preserving debt sustainability.

They urged authorities to maintain a robust debt management framework to avoid accumulating new external arrears.

Reacting to the IMF Board’s decision, Finance and Development Planning Minister Augustine Kpehe Ngafuan described the approval as a “strong vote of confidence” in the government’s handling of the economy under President Joseph Nyuma Boakai’s leadership.

“This outcome is a testament to our commitment to prudent economic management and fiscal discipline at a time when Overseas Development Assistance is declining,” Ngafuan said.

He added that the successful review places Liberia in a strong position to qualify for significant additional support under the IMF’s Resilience and Sustainability Facility (RSF) in 2026.

The RSF provides long-term financing to countries implementing policies that build climate resilience and mitigate vulnerabilities.

Minister Ngafuan also extended praise to Central Bank Governor Henry F. Saamoi and his team for their “excellent coordination” with fiscal authorities in maintaining monetary stability and advancing key reforms.

He reaffirmed the government’s determination to remain on course with the ECF program and to accelerate measures aimed at expanding the economy and mobilizing domestic revenues.

“These resources will help us support the ambitious targets set under the ARREST Agenda for Inclusive Development (AAID). We are committed to using them responsibly to drive inclusive growth, reduce poverty, and invest in the future of our country.” Ngafuan stressed.

Under the terms of the ECF, the IMF Board approved a total of US$223 million to be disbursed in several tranches over the 40-month program period, contingent on regular performance reviews.

Each review assesses the government’s compliance with agreed policy reforms and macroeconomic benchmarks.

Liberia’s latest performance review comes amid cautious optimism from economic observers, who point to signs of macroeconomic stability including improved revenue mobilization, stable foreign reserves, and a gradually strengthening exchange rate despite ongoing fiscal pressures and global economic headwinds.

Analysts say continued IMF support could enhance investor confidence, attract new development financing, and provide the fiscal space needed for Liberia to invest in infrastructure, healthcare, education, and climate resilience.

However, they caution that maintaining reform momentum will be critical to sustaining growth and reducing vulnerability to external shocks.

With two reviews now completed under the ECF, Liberia enters the second phase of its reform program with growing international support and a strengthened policy foundation.

The government works to implement the next set of structural reforms; the IMF disbursement is expected to play a pivotal role in stabilizing the economy and unlocking new opportunities for sustainable development.