Central African Economic and Monetary Community: Common Policies in Support of Member Countries Reform Programs-Staff Report; and Statement by the Executive Director

This paper highlights Central African Economic and Monetary Community’s (CEMAC) common policies in support of member countries reform programs. CEMAC benefited from favorable hydrocarbon prices in 2022. Economic recovery firmed up and the external position strengthened, with external reserves building up faster in recent months, although still below adequate levels. Monetary policy was tightened to stem rising inflation, and fiscal positions improved owing to higher oil revenues. However, underlying non-oil fiscal positions deteriorated, highlighting the necessity of accelerating reforms and tackling recent fiscal slippages, to help save part of the oil windfalls and bring polices back in line with IMF-supported program objectives and IMF staff advice. The report recommends standing ready to tighten monetary policy further; mop up excess liquidity; and resolve pending challenges to a complete, transparent, and consistent implementation of the foreign exchange regulations. It also suggests accelerating governance and productivity-enhancing structural and regulatory reforms; broaden the tax base beyond the hydrocarbon sector; and deepen regional trade integration.