Togo’s external over-indebtedness risk is “moderate”, according to IMF
Wednesday, 04 July 2018 17:32 
(Togo First) - At end-December 2017, Togo’s external debt stood at 19.9% of its GDP while internal debt was at 58.8% of GDP. As for debt service, it was valued at 24% of revenues in 2017. This was reported by the International Monetary Fund (IMF) in the framework of its second review under the Extended Credit Facility (ECF).
Since debt has over the past few years impaired public investments in Togo, the report approves Togo’s government’s efforts to borrow outside at more favorable rates in order to pay its costly internal debt which slows private sector particularly and the economy as a whole.
“Though the ECF-backed scheme currently plans for a zero cap for non-concessional debt, risk of external over-indebtedness for Togo is deemed moderate and non-null caps are thus acceptable for non-concessional loans, provided that they do not degrade external over-indebtedness risk rating,” the Fund states.
In its review, the Bretton Woods institution in fact applauds Togolese authorities for the various measures implemented to better manage debt. “Authorities have made a lot of efforts to pay arrears in 2017 with net repaid amount standing at CFA50 billion, that is 41% of all recent arrears”. IMF expects total repaid arrears to stand at CFA65 billion this year and CFA35 billion in 2019.
Still this year, as a result of government’s efforts and reforms to implement under the ECF, external debt should fall below 18.2% of GDP. Togo should lower debt service with an efficient cooperation framework with IMF: “Starting from July 2018, authorities will provide IMF monthly data on outstanding arrears by age”.
Fiacre E. Kakpo
