Africa CDC to launch Eastern Regional Co-ordination center

The African Union (AU) through the Africa Centres for Disease Control and Prevention (Africa CDC) is set to launch the Eastern regional co-ordination center in Kenya come October 1.

The East African RCC will be launched under the theme of “Ensuring effective preparedness and response to current public health threats in the context of COVID-19 and beyond.” The RCC serves as a hub for Africa CDC surveillance, preparedness, and emergency response activities, and coordinates regional public health initiatives by Member States in consultation with the Africa CDC headquarters.

Speaking at the weekly briefing on September 23, the Director of the Africa CDC, Dr. John Nkengasong, confirmed that the institution will be launching its Eastern regional collaborative center in Kenya very soon.

“We will be launching our regional collaborating center in Kenya. There are five regional collaborating centers, i.e. Egypt, Kenya, Nigeria, Zambia, and Gabon. These centers have been operating, but some of them have not been officially launched. This occasion will be for launching the center in the presence of several ministers from the republic of Kenya and we invite you (the media) to be part of that ceremony in Kenya.”

Gabon Economy recovering, says IMF Review Mission

An International Monetary Fund (IMF) mission led by Boileau Loko in Libreville, Gabon, said economic activity is recovering, with growth estimated at about 1.2 percent in 2018 up from 0.5 percent in 2017, despite lower-than-expected oil production.

The team  visited Libreville during November 7–16 to conduct discussions on the third review of Gabon’s extended arrangement under the Extended Fund Facility (EFF). 

Mr. Loko said inflation increased to 3.4 percent (12-month average) in September 2018, reflecting higher food prices and the pass through of rising international oil prices, and that fiscal performance at end-September was better than expected, thanks to higher than targeted non-oil revenue collection.

He said the recovery is expected to firm up in 2019 and the medium-term outlook is still promising, with GDP growth projected to reach 3.1 percent in 2019 and 5 percent in the medium term, adding that downside risks to the outlook include the failure to implement the planned fiscal consolidation, lower global growth and a marked tightening of global financial conditions.

The team commended the authorities’ efforts to improve program implementation since the second review as most end-September 2018 targets were met and most program-supported structural reforms were implemented, albeit with some delays.

Fiscal consolidation remains a priority under the program. The mission took note of the authorities’ commitment to implement all critical measures in the 2018 supplementary budget to meet the end-year fiscal deficit target. Fiscal policy in 2019 aims at further enhancing non-oil revenue mobilization, containing the wage bill, and improving the composition of public spending to provide space for priority social and capital expenditure.

Improving budgetary execution, aligning expenditure commitments and cash flows plans, and fully operationalizing the Treasury Single Account will strengthen transparency, cash management, and budget monitoring. Continued efforts are also needed to enhance debt and cash management to prevent the accumulation of domestic and external arrears.

The mission highlighted the fiscal risks posed by public agencies. Despite some progress, the financial position of several public agencies and enterprises remains precarious, and unless improved, it could represent significant contingent liabilities for the government. The authorities have renewed their commitment to tighten controls on special accounts spending.

The mission underscored the need to speed up the liquidation of the three distressed banks and expeditiously tackle the NPL overhang to strengthen the banking sector and foster credit to the private sector. Further improving the business environment is also critical.

The mission welcomed the authorities’ commitment to implementing policies consistent with the stability of the region’s monetary arrangement. Continued fiscal consolidation and tangible actions to strengthen compliance with foreign exchange regulations, notably regarding the repatriation of export earnings, are critical to rebuild the BEAC’s foreign reserves.

The IMF Executive Board could consider the third review in December 2018.

IMF team in Gabon to help restore macroeconomic stability and lay the foundation for inclusive growth

An IMF team carried out the first review of Gabon’s extended arrangement under the Extended Fund Facility (EFF)  to help Gabon restore macroeconomic stability and lay the foundation for inclusive growth.

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• The EFF-supported program will help Gabon restore macroeconomic stability and lay the foundation for inclusive growth.
• Completion of the first review would enable a second program disbursement of SDR71.43 (about US$98.8 million).
• Gabon’s near-term economic outlook remains difficult, with growth expected at about 0.8 percent in 2017, but there are signs that the economy is stabilizing.

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The International Monetary Fund (IMF) staff team led by Alex Segura-Ubiergo visited Libreville from October 18 to November 1 for the first review of Gabon’s extended arrangement under the Extended Fund Facility (EFF).

It seeks to buttress debt sustainability at the national level and contribute to the external stability of the Central African Economic and Monetary Union (CEMAC), building on the collective efforts of the other member states and regional institutions of the currency zone.

At the conclusion of the visit, Mr. Segura-Ubiergo issued the following statement:

“The IMF team reached a staff-level agreement with the authorities on the economic policies needed to complete the first review of the EFF. The IMF Executive Board is expected to consider the staff report for the first review in mid-December 2017. The completion of the first review would enable a second program disbursement of SDR71.43 (about US$98.8 million).

“Gabon’s near-term economic outlook remains difficult, with overall growth expected to be modest at about 0.8 percent in 2017. However, there are signs that the economy is stabilizing. The oil sector is benefiting from the recovery in international energy prices and other resource sectors (manganese, timber, and agri-business) are expanding rapidly. Growth in Gabon’s extractive industries helped boost exports by 38 percent (y/y) at end June, helping improve the trade balance and moderate the decline in the level of imputed international reserves of Gabon at BEAC. Nonetheless, the economy still faces significant vulnerabilities. The commercial and services sectors remain weak and bank deposits and credit to the economy continued to decline.

“Strong efforts to contain public spending and larger than expected oil revenues have contributed to overperformance on the authorities’ fiscal adjustment program. The overall fiscal deficit (on a cash basis) is expected to decline to 3.6 percent of GDP in 2017 (compared to 6.6 percent of GDP in 2016). Public debt is projected to decline to 59 percent of GDP in 2017, as opposed to the initial projection of 64.2 percent of GDP, thanks to exchange rate appreciation and fiscal consolidation. However, weaknesses in non-oil revenue collections and pressures coming from the government wage bill are sources of fiscal risk that need to be addressed.

The authorities reiterated their commitment to pursue public sector reforms to support the arrears clearance and prevention strategy, mobilize non-oil tax revenues, and strengthen public financial management. Fiscal consolidation will continue in 2018, with an overall fiscal deficit (cash basis) that is expected to decline to about 2.3 percent of GDP. The IMF team emphasized the important of protecting, and to the extent possible, increasing budgetary allocations for critical social programs, especially those that can more directly benefit low income groups.

“Program implementation remains broadly on track. Through the first half of 2017, most quantitative performance criteria and structural benchmarks were met, but the authorities accumulated new external and domestic arrears. While a large share of external financial support is expected in the last quarter of the year, the authorities need to strengthen short term debt and cashflow management and expenditure control procedures to prevent the accumulation of new arrears. In addition, frequent communication with both domestic and external creditors and the implementation of a credible plan to deal with arrears will be key to preserve the credibility of Gabon’s economic policies and restore confidence.

“The strategy to deal with arrears has become the most pressing short-term economic challenge for Gabon. Domestic arrears, especially unpaid bills to government suppliers, are seriously impacting private sector activity, and negatively affecting small and medium enterprises that should remain an important source of innovation and employment creation. At the same time, external arrears need to be cleared expeditiously to maintain the creditworthiness of Gabon and ensure adequate levels of foreign investment and external financing, including for projects that are likely to support the authorities’ diversification strategy.

“Gabon should also continue to pursue business environment reforms, which are an important element of the country’s diversification strategy that seeks to raise growth toward 5 percent over the medium term.

“The team met with the Minister of Economy Immongault, Budget Minister Otandault, the Deputy National Director of BEAC, and other senior government officials, representatives of the private sector, civil society, and the diplomatic community. The team would like to thank the Gabonese authorities for their constructive discussions and hospitality.”