The Executive Board of the International Monetary Fund has finally approved an Extended Credit Facility for Burundi to the tune of USD 271 Million.
Burundi, which is one of the seven countries forming the East African Community (EAC), will be getting an immediate disbursement of more than USD 62 million, from the arrangement.
According to an official statement from the International Monetary Fund (IMF) the loan facility will help to address the country’s protracted balance of payments needs.
The money will also assist Bujumbura to rebuild external buffers and support the Burundi government’s reform agenda.
As one of the worlds’ claimed poorest countries, Burundi’s economy is just starting to recover from years of conflict and political upheaval under its former leader, the late Pierre Nkurunziza.
Some reports claim that Nkurunziza’s Government took a drastic toll on the Burundi economy, leaving the country’s key sectors seriously devastated.
The country’s current Head of State, President Evariste Ndayishimiye took office in June 2020, which was seven days after the death of President Pierre Nkurunziza.
While it is not known what the former President of Burundi died of, reports say he had passed away suddenly, in the midst of the Covid-19 pandemic.
Mr Ndayishimiye reportedly won the last May presidential election, and was due to take office in August. He is believed to be able to turn the country’s fortunes around though the opposition thinks he rigged the polls.
Now, as far as the International Monetary Fund is concerned, the approved funding becomes Burundi’s first Upper Credit Tranche-quality arrangement with the IMF since 2015.
The new development is therefore also expected to ‘catalyze more donor funding, into Burundi,’ something which is essential to cater for the country’s large financing needs and support its exit from what is being described as fragility.
Other East African countries, such as Tanzania have been receiving IMF funds to rescue their economies from effects of the global Covid-19 Pandemic which wreaked the world for nearly three consecutive years between late 2019 and late 2022.