An International Monetary Fund (IMF) team on a review of the economic situation in Guinea-Bissau has said that the country?s economic growth is projected to rebound in 2013. The IMF mission led by Mauricio?Villafuerte conducted its review between April 29 and May 9.

In a statement made in Abidjan, the mission chief, Villafuerte said the team met with critical stakeholders in the country?s economy during exercise.

“Economic growth is projected to rebound in 2013 from a very difficult situation in 2012 which was marked by a sharp drop in cashew nut export volumes and prices,?? he said.

He said the difficult economic situation in 2012 was also caused by a decline of support from development partners.

Villafuerte said that a recovery in cashew export and continued support from regional partners would help Real Gross Domestic product (GDP) to rise by three and half per cent in 2013.

According to him, a delay in the cashew export campaign associated with some financing constraints remained a downside risk factor.

The IMF chief said there was need for tight expenditure envelope and strict fiscal controls to avoid domestic arrears while protecting social and priority spending.

“ The low levels of projected revenue and grants, together with limited financing options, imply the need for a tight expenditure envelope and strict fiscal controls,?? he said.

He said the mission was in agreement with the main parameters of Guinea-Bissau?s draft 2013 budget.

“ We call for a rapid legislative approval and committed implementation of revenue measures envisaged in the budget,?? he said.

Villafuerte further said that Medium-term growth prospects in the country would depend on the stabilisation of the political environment and increased support by traditional development partners.

“It is clear that the absence of these conditions will complicate the government?s ability to meet recurrent expenditures and to tackle large infrastructure gaps,?? he said.

Guinea-Bissau was hit by a coup on April 12, 2012, about two weeks to the run-off?of its presidential election.

Following international condemnation and sanctions against leaders of the junta, an agreement was signed making the third place candidate in the election,?Serifo Nhamadjo an interim president.

The presidential election was postponed for at least two years?while an interim government is tasked with administering Guinea-Bissau.


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