Haiti's GDP grew by 4% in 2013 according to IMF

Haiti's Gross Domestic Product grew by 4% in 2013 according to preliminary data announced by the International Monetary Fund on November 25th, after its visit to Port-au-Prince to conduct discussions for the seventh review under the Extended Credit Facility (ECF) arrangement.

 

The IMF mission report states: "Preliminary data suggests that Gross Domestic Product (GDP) grew around 4 percent in FY2013 (i.e. in the year through September 2013) thanks to ongoing reconstruction spending, increased textile exports, and a better-than-expected outcome for agriculture. Inflation, which had spiked to almost 8 percent after last year’s drought and hurricanes, finished FY2013 at 4.5 percent due to stabilizing commodity prices and some tightening of monetary policy earlier in the year. The fiscal deficit was larger than programmed, largely due to higher transfers to EDH (Electricité D’Haiti), the state electricity company. Domestic revenues were lined with projections at the time of the sixth review." 


Other remarks and recommendations

 

IMF announced that For 2014 Fiscal Year (FY), inflation is projected to stay in the mid-single digits and GDP growth around the levels observed in FY2013.

 

The mission recommended to put more efforts to "combat tax evasion, so as to ensure more robust revenue collection, which is essential to offset gradual declines in foreign assistance."

 

IMF also noted that subsidies to EDH are very costly; and recommends the improving of the financial position of the electricity sector to free up resources for social and infrastructure spending.

 

The Extended Credit Facility (ECF) has replaced the Poverty Reduction and Growth Facility (PRGF) as the Fund’s main tool for medium-term financial support to low-income countries by providing a higher level of access to financing, more concessional terms, enhanced flexibility in program design features, and more focused streamlined conditionality. Financing under the ECF currently carries a zero interest rate, with a grace period of 5½ years, and a final maturity of 10 years. The Fund reviews the level of interest rates for all concessional facilities every two years.


Article Tags: #Haiti #Economy #GDP #IMF #growth
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