Business
IMF Approves New Extended Credit Facility Arrangement for Mali and US$9.2 Million Disbursement
BAMAKO – The Executive Board of the International Monetary Fund (IMF) today approved a new arrangement under the Extended Credit Facility (ECF) for Mali for an amount equivalent to SDR 30 million (about US$ 46.2 million or 32 percent of quota). The approval enables the immediate disbursement of an amount equivalent to SDR 6 million (about US$9.2 million).
The authorities’ program is designed to reduce balance-of-payments vulnerabilities and lay foundations for stronger, more inclusive growth. Reform efforts are focused on tax policy and revenue administration, public financial management and improving the business environment.
The new Fund-supported program builds on the success of the authorities’ policies supported by disbursements under the Rapid Credit Facility in 2013
Following the Executive Board’s discussion, Mr. Min Zhu, Deputy Managing Director and Acting Chair issued the following statement:
“Mali’s authorities have succeeded in maintaining macroeconomic stability in very difficult circumstances. The economy is recovering and the outlook is improving with the resumption of donor support and a gradual return of investor confidence. However, significant challenges remain. Against this background, a new Fund-supported arrangement under the Extended Credit Facility will help support the authorities’ economic program to sustain growth, maintain fiscal sustainability, and reduce poverty.
“Higher domestic revenue mobilization and increased efficiency of public spending will create fiscal space for needed development spending. Limited government recourse to domestic bank borrowing will safeguard credit to the private sector. Improved public financial management will ensure that donor funding is put to effective use, and improved internal expenditure controls will help prevent the accumulation of domestic arrears. More broadly, a prudent debt management centered on concessional borrowing will be needed in the period ahead.
“Far-reaching reforms will help improve the business environment, promote economic diversification, and boost Mali’s growth prospects. Priority areas include increasing financial development, combating corruption, streamlining tax procedures, improving infrastructure, and increasing labor productivity through improved education and health spending. Well communicated reforms in the production and pricing of energy are also important for fostering durable growth and reducing poverty.”
Annex
Recent economic developments
Mali is emerging from the most serious security and political crisis in its recent history.
The recent arrival of a UN security force (MINUSMA) is helping the government restore law and order in the north. Political normalization is well under way with the successful presidential and parliamentary elections. International financial support has been successfully mobilized: in May 2013, at the international donor conference in Brussels, donors pledged €3.25 billion ($4.4 billion) in financial assistance.
In the meantime, the economy is recovering and inflationary pressures have abated. After a 0.4 percent GDP decline in 2012, the improvement in the security situation and the resumption of donor assistance has helped revive business confidence. Activity is picking up in the service sectors hardest hit by the crisis (commerce, hotels, and restaurants). Favorable rainfall has boosted agricultural production. Average inflation declined from 5.3 percent in 2012 to negative 0.1 percent by October 2013 as food prices declined following the good harvest.
Prospects for the remainder of 2013 and for 2014 are generally favorable. The nascent recovery should gather strength as donor support builds up and credit to economy picks up. Real GDP is projected to increase by 5.1 percent in 2013 and 6.6 percent in 2014 supported by the rebound in agricultural output, the establishment of a third mobile phone operator, recovery in the service sector, and restart of construction projects. After 2014, growth is projected to settle in the 5–6 percent range. Average inflation is projected to remain close to zero in 2013 and reach 2 percent in 2014, below the 3 percent West African Economic and Monetary Union’s (WAEMU) ceiling.
The positive outlook is subject to several risks. Agricultural output is vulnerable to adverse weather conditions. Because of strong export concentration on gold (70 percent of the total) and cotton (15 percent of the total), export revenues depend to a large extent on volatile international gold and cotton prices. The security situation remains fragile despite recent improvements. Any setbacks in peace consolidation could weaken consumer, investor, and donor confidence and derail the incipient recovery. On the other hand, Mali is not significantly exposed to negative risks in the euro area because its exports are inelastic toward traditional trade partners’ growth. The banking sector is mostly financed by local deposits and is not directly exposed to the ongoing deleveraging of European banks.
Program Summary
The authorities’ programs aims at promoting policies that: (i) maintain macroeconomic stability, while allocating sufficient resources to poverty-reducing and other priority spending, including in the North; (ii) mobilize more government revenue;
(iii) strengthen public financial management; and (iv) improve the business environment, including by implementing anti-corruption measures.
Public spending will support national reconciliation, growth and poverty reduction. Budgetary allocations will be in line with the Growth and Poverty Reduction Strategy (G-PRSP) and the Plan for Sustainable Recovery (PRED). To that end, the authorities are committed to giving priority social spending—health, education and social development.
To increase tax revenue and lighten the administrative burden on the taxpayer, the Government will implement ambitious tax policy and administration reforms. Transparency will be used to build political support for a reduction of tax exemptions. In that context, the authorities intend to reform fuel pricing. Starting in 2013, the budget law has begun presenting estimates of the cost to the budget of the failure to adjust fuel prices to international oil price movements. To stem, and ultimately reverse, the erosion of tax revenue from petroleum products, the authorities will abandon the practice of setting the administrative value (used for tax calculation) below the market value. In order to improve the business climate, the government will take steps to address the most problematic factors for doing business. Investors consider access to financing, corruption, poor infrastructure (including electricity), tax regulation are key ingredients. The state electricity company will be reformed with the view of putting it on a sound financial footing.
The authorities have also stated their deep commitment to combating corruption. They will put in place concrete actions, one of which is a systematic follow up of all recommendations of varying control agencies, with regular reports on judicial or administrative actions taken. Another is the publication of judicial decisions.
Given the early stage of Mali’s recovery from the recent political and security crisis, reforms will be implemented progressively. The initial phase—through mid–2014—focuses on strengthening institutional capacity and developing strategies to address the most pressing issues. The following phases of the program will involve rolling out policy actions in these areas. These actions will be specified at the time of the first and subsequent reviews of the arrangement.
Nigeria recorded the largest increase in the number of people experiencing multidimensional poverty among five countries that registered increases over their latest measurement periods, according to the United Nations Development Programme (UNDP).
The finding was contained in the 2026 Global Multidimensional Poverty Index report, released on Monday by the UNDP and the Oxford Poverty and Human Development Initiative (OPHI).
According to the report, Nigeria’s multidimensional poverty rate rose from 33 per cent in 2021 to 38.7 per cent in 2024, representing an increase of 5.7 percentage points.
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The number of Nigerians living in multidimensional poverty increased from 72.2 million in 2021 to 90.1 million in 2024, leaving an additional 17.9 million people affected.
The report noted that the latest increase reversed the progress Nigeria recorded between 2018 and 2021, when the proportion of people living in multidimensional poverty declined.
Nigeria’s Multidimensional Poverty Index value also increased from 0.175 in 2021 to 0.208 in 2024, reflecting a rise in both the incidence and intensity of deprivation.
The intensity of deprivation among multidimensionally poor Nigerians increased from 52.9 per cent to 53.6 per cent over the same period.
Unlike income-based poverty measures, which assess poverty based on how much people earn or spend, the Multidimensional Poverty Index examines overlapping disadvantages experienced in daily life.
The index measures deprivation across three dimensions: health, education and standard of living.
Its 10 indicators include nutrition, child mortality, years of schooling, school attendance, cooking fuel, sanitation, drinking water, electricity, housing and household assets.
A person is classified as multidimensionally poor when their household experiences deprivation in at least one-third of the weighted indicators.
The report showed that Nigeria had made progress in reducing multidimensional poverty before the latest increase.
The country’s index value declined from 0.230 in 2013 to 0.202 in 2018 and 0.175 in 2021 before rising to 0.208 in 2024.
Similarly, the proportion of Nigerians living in multidimensional poverty fell from 42.3 per cent in 2013 to 37.2 per cent in 2018 and 33 per cent in 2021 before increasing to 38.7 per cent in 2024.
The number of affected Nigerians also declined from 76.3 million in 2018 to 72.2 million in 2021 before climbing to 90.1 million in 2024.
The report further highlighted significant differences in multidimensional poverty across Nigeria’s subnational regions, with incidence ranging from 3.7 per cent to 88.3 per cent across the regions covered by the analysis.
It compared Yobe and Sokoto, two of Nigeria’s poorest subnational regions with similar Multidimensional Poverty Index values, to illustrate how the forms of deprivation experienced by communities can differ despite comparable overall poverty levels.
Globally, the report estimated that 1.2 billion people across 108 countries lived in acute multidimensional poverty.
Sub-Saharan Africa accounted for 616 million people living in multidimensional poverty, while South Asia followed with 393 million.
The report also found that 83.3 per cent of the world’s multidimensionally poor population, equivalent to approximately 998 million people, lived in rural areas, compared with 200 million in urban areas.
Children below the age of 18 accounted for 617 million, or 51.5 per cent, of the world’s multidimensionally poor population.
In sub-Saharan Africa, 355 million children lived in multidimensional poverty, accounting for 57.7 per cent of the region’s poor population.
In a bold move to deepen retail participation in Nigeria’s capital market, the Aliko Dangote Foundation (ADF) has unveiled a share grant initiative aimed at helping up to five million tertiary students and two million vulnerable women become shareholders in Dangote Petroleum Refinery and Petrochemicals (DPRP) through its Initial Public Offering (IPO).
Managing Director and Chief Executive Officer of ADF, Zouera Youssoufou, disclosed that the Foundation will match qualifying share subscriptions by eligible beneficiaries. Under the programme, students who subscribe for the minimum 10 shares worth N5,250 will receive an additional 10 shares funded by the Foundation, subject to the approved process and allocation, effectively doubling their holdings to 20 shares.
Speaking during a television interview, Youssoufou said the initiative was designed to turn the refinery’s “People’s IPO” vision into reality by giving traditionally underserved groups a direct stake in one of Africa’s largest industrial assets.
“When Aliko announced the IPO, he described it as the IPO of the people and wanted as many Nigerians as possible to participate,” she said.
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According to her, students and vulnerable women were specifically selected because they have historically been underrepresented in the capital market.
The ADF said it is prepared to support up to five million students enrolled in Nigerian tertiary institutions, including universities, polytechnics and colleges of education. Eligible applicants must be at least 18 years old and enrolled in a recognised institution. The Foundation is working with relevant educational authorities to verify beneficiaries.
Youssoufou revealed that about N25 billion has been earmarked for the student component of the scheme, while the broader programme for students and vulnerable women is valued at approximately N40 billion.
She emphasised that the intervention is a grant, not an investment, with all shares ultimately belonging to the beneficiaries.
“The shares end up with the beneficiary. Our goal is to help people who may never have had the opportunity to own shares begin building long-term wealth,” she said.
Beyond students, ADF plans to support up to two million vulnerable women, including widows, women living in extreme poverty, persons with disabilities, and widows of members of the Armed Forces. The Foundation is partnering with state governments, the Ministry of Women Affairs, the Armed Forces and other institutions to identify eligible participants.
According to Youssoufou, the initiative is not only about widening ownership in the refinery but also about promoting financial literacy, encouraging a culture of savings and investment, and helping Nigerians build sustainable wealth through participation in the capital market.
Nigeria’s efforts to increase production and curb crude oil theft still leaves her short of meeting the demands of the 700,000 barrels demand of the Dangote Petroleum Refinery and Petrochemicals (DPRP).
Minister of Finance and Coordinating Minister of the Economy, Taiwo Oyedele, made the disclosure during an interview on Channels Television’s Politics Today at the weekend.
The disclosure comes amid renewed debate over government intervention in the petroleum market, with proposals for production subsidies, the 30-days petrol discount and other measures to support domestic refining and reduce the cost of petroleum products.
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He explained that Nigeria’s total crude oil production does not translate into an equivalent volume available for allocation by the government.
Oyedele said Nigeria’s crude oil production of about 1.8 million barrels per day was shared among parties operating under production-sharing contracts and joint ventures, while production costs, royalties and other obligations further reduced the volume available to the government.
“Under the production-sharing contract and joint venture, they share these things, and the ratios vary. Let’s say roughly 45:55,” he said.
He explained that oil producers first recover eligible production costs through cost oil, while royalties and contractual sharing arrangements also determine the quantity ultimately accruing to the government.
“The long and short of what I’m telling you is whatever is left for Nigeria, we exhaust it almost entirely because of fuel subsidy,” he said.
According to the minister, the situation was particularly severe before President Bola Tinubu introduced the economic reforms in May 2023, when the Nigerian National Petroleum Company Limited (NNPC Ltd), which holds the country’s crude on its behalf, had less than 100,000 barrels of freely available crude remaining.
He said the government had exhausted much of its revenue and resorted to printing money before turning to future crude oil production to secure commitments used to finance present consumption.
“That was a ticking time bomb,” Oyedele said, describing the arrangement under which future oil production was committed to support current fuel consumption.
The minister, however, acknowledged improvements following increased production, efforts to reduce crude oil theft and the renegotiation of some existing commitments that had tied down the country’s crude.
He cited comments by business leader Tony Elumelu, who had previously expressed frustration over the scale of crude oil theft in Nigeria, and subsequently reported an improvement in the situation.
Despite these gains, Oyedele said the country was yet to attain the level of freely available crude required to supply the Dangote refinery with its full daily requirement.
“But we are still not at the point where we can give Dangote 700,000 barrels,” he said.
The minister dismissed proposals for the government to supply the refinery with discounted crude or at production cost, arguing that such proposals failed to recognise the constraints on the volume of oil available for allocation.
“We don’t have enough to service Dangote. Dangote imports crude,” he said.
He added that the naira-for-crude arrangement introduced by the Federal Government had helped provide some stability but had not eliminated the supply constraints.
According to him, sustained increases in crude oil production and the release of additional barrels from existing commitments would eventually enable Nigeria to meet the requirements of Dangote and other domestic refiners.
“As we ramp up production and we free up some barrels, we’ll get to a point where we’ll be able to give Dangote everything he wants and other refiners will be able to get enough,” he said.
Oyedele also expressed hope that Nigeria would eventually refine all the crude oil it produces domestically and export refined petroleum products rather than crude.
The disclosure comes amid renewed debate over government intervention in the petroleum market, with proposals for production subsidies and other measures to support domestic refining and reduce the cost of petroleum products.
Oyedele further maintained that achieving that ambition will depend not only on the expansion of refining capacity but also on sustained growth in crude oil production and the availability of additional volumes for domestic processing.
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