The International Monetary Fund (IMF) has reached staff-level agreements with the Gambian authorities on the fifth review of the country’s Extended Credit Facility (ECF) programme and the second review of its Resilience and Sustainability Facility (RSF), paving the way for additional financial support to help the country navigate mounting economic pressures linked to the ongoing conflict in the Middle East.
The agreements were reached following discussions held in Banjul from April 22 to May 6, 2026, led by IMF mission chief Eva Jenkner, with further engagements conducted remotely.
Under the ECF arrangement, the IMF agreed to extend the programme by six months until July 2027 and increase access by SDR 12.44 million (approximately US$17 million). The augmentation is intended to help The Gambia address emerging economic challenges stemming from rising global commodity prices and broader uncertainties caused by the conflict in the Middle East.
Subject to approval by the IMF Executive Board and the implementation of agreed prior actions, the decision will unlock an immediate disbursement of SDR 6.22 million (about US$8.5 million). Total disbursements under the ECF programme would then rise to SDR 55.97 million (approximately US$76.6 million).
The IMF also reached a staff-level agreement on the second review of The Gambia’s 18-month Resilience and Sustainability Facility programme, approved in June 2025. The review would enable the release of SDR 10.36 million (around US$14.2 million), increasing total RSF disbursements to SDR 25.9 million (about US$35.5 million).
The RSF programme has also been extended by six months to July 2027 to allow additional time for implementing key climate and sustainability reforms.
The IMF Executive Board is expected to consider both reviews in early July.
Economic Growth Remains Strong
Despite global headwinds, The Gambia’s economy continued to demonstrate resilience in 2025. The IMF estimates real GDP growth at 6 percent, driven largely by strong performance in agriculture and construction.
Tourism and remittance inflows also remained robust, providing critical support to economic activity and household incomes.
Inflation, which peaked at 18.5 percent in September 2023, has declined significantly, reaching 7 percent in April 2026. The IMF attributed the improvement primarily to lower international food and energy prices over much of the period.
However, inflation remains above the Central Bank of The Gambia’s medium-term target of 5 percent. The Fund warned that rising commodity prices linked to the conflict in the Middle East are beginning to feed into domestic prices and could intensify inflationary pressures in the months ahead.
“The war is expected to affect significantly the macroeconomic outlook and amplify domestic risks in 2026 and beyond,” Ms. Jenkner said in a statement issued at the conclusion of the mission.
Fiscal Challenges Persist
The IMF noted that fiscal performance in 2025 fell short of expectations despite strong tax revenue collection.
According to the Fund, government spending exceeded planned levels due to unbudgeted transfers, arrears payments, emergency subsidies to the National Water and Electricity Company (NAWEC), and support to the National Food Security Processing and Marketing Corporation.
As a result, the fiscal deficit widened to 5 percent of GDP, exceeding programme targets.
Public debt stood at approximately 79 percent of GDP at the end of 2025. While the IMF considers the debt sustainable, it stressed that limited fiscal buffers require prudent budget management, particularly as the government confronts new economic pressures linked to the Middle East conflict.
The Fund recommended that authorities reallocate expenditures where necessary to absorb the impact of external shocks without undermining fiscal sustainability.
Mixed Programme Performance
Performance under the ECF programme was broadly satisfactory, according to the IMF.
Five of the seven quantitative performance criteria set for December 2025 were met, while two were missed by significant margins due largely to expenditure overruns. All indicative targets were achieved.
The IMF also reported progress on structural reforms, with five of six structural benchmarks completed. These measures focused on strengthening public financial management, improving statistics, and enhancing financial sector stability. The remaining benchmark is expected to be completed in the coming weeks.
Central Bank Urged to Stay Focused on Inflation
The IMF encouraged the Central Bank of The Gambia (CBG) to maintain a tight monetary policy stance to ensure inflation returns to its 5 percent target.
The Fund also called for greater reliance on market forces in determining the exchange rate, recommending that foreign exchange interventions be limited to smoothing excessive volatility and building foreign reserves.
In a notable recommendation, the IMF urged the central bank to discontinue all forms of direct or indirect financing of the public sector and ensure that ongoing revisions to the CBG Act reinforce the bank’s independence and focus on its core mandate.
While describing the banking sector as generally sound, the IMF cautioned that banks’ exposure to government debt warrants close monitoring.
Governance and Climate Reforms
The IMF welcomed ongoing efforts to strengthen governance and anti-corruption measures, including plans to establish an Anti-Corruption Commission.
According to the Fund, improved transparency and access to public information would help create a more attractive environment for private sector investment and support long-term economic growth.
On climate policy, the IMF praised progress made under the RSF programme, noting that Gambian authorities are now better equipped to integrate climate-related fiscal risks into the national budget process.
The Fund also highlighted opportunities to introduce a carbon-based fuel excise tax once international fuel prices moderate, a move that could reduce fiscal pressures while supporting climate objectives.
During the mission, IMF officials held meetings with Finance Minister Seedy Keita, Central Bank Governor Buah Saidy, senior government officials, representatives of state-owned enterprises, development partners, civil society organisations, and private sector stakeholders.
The IMF reaffirmed its commitment to supporting The Gambia through financing, policy advice, and technical assistance as the country works to sustain economic growth, strengthen resilience, and advance structural reforms.
