The International Monetary Fund (IMF) says it has reached a staff-level agreement with Togo on the combined third and fourth reviews of its economic reform programme under the Extended Credit Facility (ECF), paving the way for a disbursement of about US$110.8 million pending board approval.
The agreement, announced after discussions held in Washington and Lomé, covers progress on economic policies and reforms aimed at supporting macroeconomic stability, fiscal consolidation and structural transformation in the West African nation.
If approved by the IMF Executive Board, Togo will gain access to Special Drawing Rights (SDR) 80.74 million, equivalent to approximately US$110.8 million, bringing total disbursements under the programme to about US$302.2 million.
The IMF said programme performance had been broadly satisfactory, noting that most quantitative performance criteria were met, although one target in each of the two reviews was missed. It also said structural reform implementation had progressed, with seven of eight benchmarks achieved since the last review.
Under the Extended Credit Facility arrangement, Togo is pursuing reforms aimed at strengthening public finances, improving governance, and boosting private-sector-led growth while maintaining social protection spending.
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The IMF mission, led by Tidiane Kinda, said Togo’s economy has remained resilient despite a difficult global environment. Growth reached about 6 percent in 2025, driven largely by strong activity in the services sector, while inflation moderated.
However, the Fund warned that the outlook for 2026 points to a temporary slowdown in growth and higher inflation, largely due to external shocks, including geopolitical tensions linked to the Middle East and volatile energy and food prices.
The IMF said these risks underline the importance of balancing fiscal discipline with targeted measures to protect vulnerable households from rising living costs.
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Fiscal performance in 2025 was described as solid, with the deficit narrowing to 3.2 percent of GDP, supported by spending restraint, although revenue collection underperformed in some areas.
The Fund noted that the 2026 budget is facing additional pressure from an external energy shock, and discussions focused on how to manage its impact while maintaining debt sustainability.
Authorities remain committed to reducing the fiscal deficit to 3 percent of GDP by 2027, supported by efforts to improve domestic revenue mobilisation and implement a medium-term fiscal strategy.
Beyond fiscal policy, the IMF stressed the importance of financial sector stability and reforms to state-owned enterprises, particularly in the energy sector, which continues to pose fiscal risks.
It also called for continued improvements in governance and the business environment to encourage investment and support long-term growth.
The IMF said protecting social spending remains a core priority of the programme, noting that Togo met its pro-poor spending targets during the review period.
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The Fund thanked Togolese authorities for what it described as constructive engagement and strong cooperation during the mission, which included meetings with government officials, the central bank, civil society groups and development partners.
The agreement now moves to the IMF Executive Board for final consideration.
