Liberia: 2025 Article IV Consultation and Second Review Under the Extended Credit Facility Arrangement and Request for a Waiver of Nonobservance of a Continuous Performance[...]

Summary

On September 25, 2024, the Board approved a forty-month arrangement under the Extended Credit Facility to support the authorities' new 5-year development plan Arrest Agenda for Inclusive Development (AAID). The overarching objective of this plan is to preserve macroeconomic stability, by restoring fiscal and debt sustainability, enhancing financial sector stability, and mobilizing additional external resources to address large infrastructure gaps. While Liberia has benefited from significant amounts of external support, the recent termination of the USAID support calls for more efforts to raise revenues and catalyze donor financing. The authorities' policy actions in the first year of the program have yielded satisfactory results. The fiscal primary balance has improved substantially through increasing tax revenues and rationalizing recurrent spending; and reforms in other areas have advanced, although at a slower pace than previously envisaged.