IMF Approves Staff-Monitored Program with Haiti

Washington-Based Financial Institution Approves 12-Month Program

The International Monetary Fund (IMF) has approved a Staff-Monitored Program (SMP) with Haiti through December 19, 2025. The Washington-based financial institution said that the new 12-month SMP was designed by the Haitian authorities and IMF staff, considering the country’s fragility and capacity constraints while supporting the authorities’ economic policy objectives.

SMPs and Haiti’s Fragile Situation

SMPs are arrangements between country authorities and the IMF to monitor the implementation of the authorities’ economic program and to establish a track record of policy implementation that could pave the way for financial assistance from the Fund under the Upper Credit Tranche (UCT). Haiti faces a multidimensional crisis, a political transition, with a challenging outlook. The country is beset by global and country-specific shocks, which have heightened its fragility. In addition to causing terrible human suffering, escalating gang violence has blocked the flow of goods and services.

Restoring Security and Macroeconomic Stability

The IMF said the top priority is to restore security and that the SMP is a prerequisite for macroeconomic stability and for allowing growth to materialize. Despite domestic and global difficulties, the Haitian authorities are firmly committed to negotiating a new SMP and have managed to contain the impact of the various shocks somewhat, thereby averting even worse macroeconomic outcomes.

Macroeconomic Outcomes and Challenges

At the end of September 2024, Haiti’s net international reserves were valued at nearly one billion US dollars. Haiti’s two key economic institutions, the Ministry of Economy and Finance and the Central Bank of Haiti have continuously engaged with the Fund despite the political instability. The IMF said that the SMP is an important anchor for signaling the Haitian authorities’ commitment to continue making progress toward macroeconomic stabilization, strengthening governance, and locking in macroeconomic gains accumulated over recent years despite the many headwinds.

Government Priority and International Community Support

The IMF said Haitian authorities have a narrow but essential window of opportunity to implement reforms that will help Haiti build resilience and restore its medium-and long-term potential. An urgent government priority is re-starting revenue mobilization to support the country’s massive development needs and boost well-targeted spending. The measures under the new SMP should help achieve these goals.

Conclusion

In conclusion, the IMF’s approval of the SMP with Haiti is a significant step towards restoring security and macroeconomic stability in the country. The Haitian authorities’ commitment to implementing reforms and the international community’s financial support are crucial for Haiti’s growth and development.

Frequently Asked Questions

Q: What is a Staff-Monitored Program (SMP)?
A: A SMP is an arrangement between country authorities and the IMF to monitor the implementation of the authorities’ economic program and to establish a track record of policy implementation that could pave the way for financial assistance from the Fund under the Upper Credit Tranche (UCT).

Q: Why is the IMF’s approval of the SMP with Haiti significant?
A: The IMF’s approval of the SMP with Haiti is significant because it provides a framework for the country to restore security and macroeconomic stability, which is essential for its growth and development.

Q: What is the Haitian authorities’ priority in implementing the SMP?
A: The Haitian authorities’ priority is to re-start revenue mobilization to support the country’s massive development needs and boost well-targeted spending.

Q: What role does the international community play in supporting Haiti’s growth and development?
A: The international community plays a crucial role in supporting Haiti’s growth and development by providing financial assistance and technical support to help the country implement its economic program and build resilience to multiple shocks.