The International Monetary Fund (IMF) approved $171.9 million of funding to Madagascar, it said on Thursday, bringing the total COVID-19 emergency support to the country to $337.9 million as the island nation’s economy struggles due to the pandemic.
It is the IMF’s second emergency disbursement to Madagascar since the onset of the pandemic and will help finance the country’s “urgent balance of payments and fiscal needs.”
Madagascar’s economy continues to deteriorate since the release of the first funding under the Rapid Credit Facility (RCF) in April, the IMF said in the statement.
“Madagascar’s economic outlook has worsened … due to a further deterioration of the global environment and a deepening of the impact of the COVID-19 pandemic,” the statement said.
Economic output was now projected to contract by 1% in 2020,while the country’s balance of payments needs have also surged on the back of financing demands required to curb the COVID-19 outbreak.
Madagascar has confirmed 10 317 cases of the coronavirus and reported 99 deaths with more than 7 100 recoveries, according to a Reuters tally.
A nationwide state of health emergency was instituted in March and authorities reimposed a lockdown in the capital and surrounding areas two weeks ago to contain the virus’spread.
President Andry Rajoelina has said he and his family had been taking “Covid Organics,” the country’s self-proclaimed,plant-based “cure” for COVID-19 launched in April, despite warnings from the World Health Organisation that its effectiveness is unproven.
The funding released on Thursday is expected to help the country meet healthcare and economic relief spending, said Antoinette Sayeh, the IMF’s deputy managing director.
Some of the sectors of Madagascar’s economy hard-hit by the novel coronavirus outbreak include tourism and export-oriented manufacturing.
“In the context of a high degree of uncertainty, more support may be needed to ease the adjustment burden,” she said.