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EXECUTIVE SUMMARY Context. The emergence of large fiscal and external imbalances in recent years, which led to a slowdown in growth, is putting Ghana's medium-term prospects at risk. The Government's efforts to achieve fiscal consolidation since mid-2013 have been undermined by policy slippages, external shocks and rising interest cost. Until mid- 2014, the net international reserves position had further weakened and the exchange rate depreciated sharply, fueling inflationary pressures. The situation has stabilized on the back of the Eurobond issued in September and a short-term loan contracted by the Cocoa Board, but public debt continued to rise at an unsustainable pace. Extended Credit Facility Arrangement (ECF). The Ghanaian authorities have requested a three-year arrangement under the ECF in an amount of SDR 664.20 million (180 percent of quota) in support of their medium-term economic reform program. Program Framework. The authorities' three year ECF-supported program, anchored on their second Ghana Shared Growth and Development Agenda (GSGDA II), aims at a sizeable and frontloaded fiscal adjustment to restore debt sustainability, rebuild external buffers, and eliminate fiscal dominance of monetary policy, while safeguarding financial sector stability. It focuses on: ? Substantially strengthening the fiscal position by mobilizing additional revenues, restraining the wage bill and other primary spending, while making space for priority spending. The government is also taking additional adjustment measures to help offset lower-than-budgeted oil revenue. A prudent borrowing policy will complement fiscal consolidation efforts to restore debt sustainability. ? Accelerating the reform agenda: strengthening public financial management and expenditure controls, in particular cleaning-up the payroll and enhancing wage bill control; improving revenue collection through tax policy and tax administration reforms; restoring the effectiveness of the inflation-targeting (IT) framework by eliminating fiscal dominance and enhancing monetary policy operations. Risks. Risks to the program include delayed or partial implementation of policies, including next year in the run-up to elections, a slower growth recovery if the electricity crisis is not addressed quickly, and additional negative commodity price shocks. Staff supports the authorities' request for IMF support. Forceful and sustained implementation of the program will be essential to address macroeconomi ...

KEY ISSUES Context: Since the last Article IV Consultation in 2012, notable progress has been achieved to enhance macroeconomic stability, underpinned by the Fund-supported program. However, continued progress could be tested as the country faces a more challenging environment, due to increasing social and political tensions and frequent strikes in the run-up to the 2015 elections. Moreover, recent political developments reinforce uncertainties surrounding external budget support. Program: The Executive Board approved the three-year arrangement under the Extended Credit Facility (ECF) on January 27, 2012, with a total access of SDR 30 million. The first, second, third, and fourth reviews were completed on July 27, 2012, February 14, 2013, September 6, 2013, and February 28, 2014, respectively. For the fifth review, all end-March performance criteria were observed, but fiscal revenues underperformed in the first quarter of 2014 requiring corrective fiscal measures (about 1 percent of GDP on an annual basis). Satisfactory progress has been made on structural reforms, albeit with some delays. Outlook and risks: The medium-term macroeconomic outlook is challenging. The principal near-term risk is an intensification of election-related uncertainty, economic disruptions and violence, which would affect investment and growth. Governance issues or delays in making measurable progress in public financial management (PFM) reforms, and heightening of political tensions could curtail donor support. Reintegrating repatriated refugees is likely to add to unemployment pressures, increase demand for public services, and exacerbate social conflict over access to land. Staff Views: The staff recommends the completion of the fifth review under the ECF arrangement, setting of revised performance criteria and indicative targets for September-December 2014, and disbursement of SDR 5 million. The authorities have consented to the publication of this report following the completion of the review

KEY ISSUES Context: Over the last two decades, good governance and sound macroeconomic management have delivered remarkable economic and social progress to Cabo Verde. More recently, however, growth has slowed due to the prolonged downturn in Europe and a sharp deterioration in domestic confidence. A longer-term decline in the contribution of total factor productivity to growth may also have played a role. Financial stability risks have increased with the rise in non-performing loans and fall in bank profitability. The country remains vulnerable to external shocks, given its dependence on tourism, remittances, and concessional financing. Over the longer term, Cabo Verde's challenge as a new middle-income country is to bolster productivity and diversify the sources of growth. Fiscal consolidation remains critical to safeguard macroeconomic and debt sustainability. Budgetary plans for 2014 and the medium term entail rising public debt, and are subject to downside risks to revenue. The authorities have already decided on a package of expenditure containment measures for 2014-17. However, given the high albeit sustainable level of public debt, further measures are needed to put public debt on a more robust downward path. Bolstering domestic revenue mobilization, increasing the efficiency of public investment, and managing existing infrastructure better are also central to sound public finances. International reserves have recovered, which provided room to ease monetary policy in support of the recovery. In the absence of imminent pressures on the balance of payments or on prices, and with private sector credit growth having stalled, the central bank has cut the policy rate. At the same time, given pressures on the banking system, continued vigilance regarding risks to financial stability is warranted. Structural reforms hold the key to bolstering competitiveness, creating jobs, and delivering inclusive growth. Increasing labor market efficiency and reducing skill mismatches would be particularly beneficial in this regard. Enhancing the efficiency of state-owned enterprises is also essential to improve delivery of infrastructure services. Data are adequate for surveillance purposes, though some key shortcomings remain. In particular, national accounts data are released with a long delay. This complicates the formulation of macroeconomic policies

This paper explores the sources of inflation in Sub-Saharan Africa by examining the relationship between inflation, the output gap, and the real money gap. Using heterogeneous panel cointegration estimation techniques, we estimate cointegrating vectors for the production function and the real money demand function to recover the structural output and money gaps for seventeen African countries. The central finding is that both gaps contain significant information regarding the evolution of inflation, albeit with a larger role played by the money gap. There is no significant evidence of asymmetr

Cover -- CONTENTS -- IMPLICATIONS OF INTERNATIONAL TAX TRANSPARENCY AND ANTI-TAX AVOIDANCE INITIATIVES FOR MAURITIUS -- A. Background -- B. The GBC Sector as Recipient of Tax Benefits -- C. Implementing the EOEC-G-20 Tax Initiatives -- D. Complying with the EU Tax Initiative -- E. Conclusions -- References -- BOX -- 1. The Four BEPS Minimum Standards -- FIGURES -- 1. Double Tax Conventions -- 2. GBC Sector Balance Sheet, 2015 -- 3. Number of GBCs -- 4. Direct Investment - Outward -- References -- MODERNISATION OF THE MONETARY POLICY FRAMEWORK IN MAURITIUS -- A. Introduction -- B. The Evolution of Monetary Policy Framework and Modern ization Efforts -- C. BOM's Compliance with the Principles of Effective Monetary Policy Conduct -- D. Conclusions and Recommendations -- BOX -- 1. Principles of an Effective Monetary Policy Framework -- FIGURES -- 1. Inflation Rate, 1980-2017 -- 2. Major Driver of Excess Liquidity in Mauritius -- 3. Excess Liquidity and Interest Rates -- 4. Interest Rate Dynamics -- References -- BOOSTING INTERNATION AL COMPETITIVENESS -- A. Introduction -- B. Recent Competitiveness Developments -- C. Competitiveness Challenges -- D. Policies To Boost International Competitiveness -- E. Conclusions -- BOX -- 1. The Wage-Setting Mechanism in Mauritius -- FIGURES -- 1. Global Competitiveness Index, 2007 vs. 2016 -- 2. Global Competitiveness Index, 2016 - 1-7 (best) -- 3. Trends in Average Productivity Growth -- 4. Wages, Labor Productivity and Unit Labor Costs -- 5. Aspects of Competitiveness -- 6. Aspects of Competitiveness -- References.

Cover -- CONTENTS -- INTRODUCTION -- RECENT DEVELOPMENTS, OUTLOOK, AND RISKS -- A. An Improving Economic Performance -- B. Positive Outlook with Downside Risks -- C. Satisfactory Program Performance -- POLICY DISCUSSIONS -- A. Maintaining Fiscal Stability -- B. Structural Fiscal Reforms for a More Robust Budget -- SAFEGUARDS ASSESSMENT -- STAFF APPRAISAL -- BOXES -- 1. Program Performance and Economic Outcomes Under Current ECF -- 2. Public Investment, Infrastructure, and Competitiveness in Burkina Faso -- FIGURES -- 1. Recent Economic Developments, 2011-16 -- 2. Real and External Developments, 2011-16 -- 3. Fiscal Developments, 2011-16 -- TABLES -- 1. Selected Economic and Financial Indicators, 2014-21 -- 2. Balance of Payments, 2014-21 -- 3. Monetary Survey, 2014-19 -- 4. Selected Financial Soundness Indicators -- 5a. Consolidated Operations of the Central Government, 2015-21 (CFAF billions) -- 5b. Consolidated Operations of the Central Government, 2015-21(in percent of GDP) -- 6. Schedule of Disbursements Under ECF Arrangement 2013-17 -- 7. Indicators of Capacity to Repay the IMF, 2015-31 -- APPENDIX -- I. Letter of Intent.

Cover -- CONTENTS -- RECENT DEVELOPMENTS, PROGRAM PERFORMANCE, AND OUTLOOK -- A. Background -- B. Recent Developments -- C. Program Performance -- D. Outlook and Risks -- POLICY DISCUSSIONS -- A. Fiscal Policies -- B. Program Financing and Debt Management Strategy -- C. Monetary Policy and Exchange Rate Issues -- D. Financial Sector Stability -- E. Structural Reform Agenda -- F. Policies to Support Growth and Poverty Reduction -- PROGRAM MODALITIES AND FINANCING ASSURANCES -- STAFF APPRAISAL -- FIGURES -- 1. Real Sector Indicators -- 2. Fiscal Indicators -- 3. External Indicators

Cover -- CONTENTS -- CEMAC-RESERVES MANAGEMENT -- A Introduction -- B. Developments in International Reserves -- C. Reserve Adequacy Considerations -- D. Recommendations for Pooled Reserve Management -- E. Securing Appropriate Resources to Back Reserves -- F. A revised Investment Strategy -- FIGURES -- 1. Oil Production, 1980-2030 -- 2. BEAC: Gross International Reserves, 2000-15 -- 3. Member States' Reserves at the BEAC, 2007-15 -- 4. International Reserves Assets Imports Cover, 2000-21 -- References -- CEMAC-DEBT SUSTAINABILITY ANALYSIS -- A. Introduction -- B. Background -- C. Assumptions

1. Actual Performance in 2014/15 and GTP II Targets for 2019/202. Financial Inclusion and Deepening; 3. Selected Economic and Financial Indicators, 2013/14-2020/21; 4a. General Government Operations, 2013/14-2020/21 (millions of birr); 4b. General Government Operations, 2013/14-2020/21 (percent of GDP); 5. Monetary Survey and Central Bank Accounts, 2013/14-2020/21; 6. Balance of Payments, 2013/14-2020/21; 7. Alternative Scenario: Selected Economic and Financial Indicators, 2013/14-2020/21; 8. Financial Soundness Indicators of the Commercial Banking Sector, 2010-16; ANNEXES.

Cover -- CONTENTS -- CONTEXT -- RECENT DEVELOPMENTS, OUTLOOK AND RISKS, AND PROGRAM PERFORMANCE -- A. Recent Developments -- B. Outlook and Risks -- C. Program Performance -- STRENGTHENING FISCAL SUSTAINABILITY AND ADVANCING THE INCLUSIVE GROWTH AGENDA -- A. 2014 Fiscal Policy -- B. The 2015 Budget and Fiscal Policy -- C. Management of Natural Resources -- D. Debt Management -- E. The Inclusive Growth Agenda -- PROGRAM DESIGN, AND IMPLEMENTATION RISKS -- A. Program Design -- B. Implementation Risks -- STAFF APPRAISAL -- FIGURES -- 1. Recent Economic Developments -- 2. Fiscal Developments 2011-15 -- 3. GDP Composition and Output Volatility -- TABLES -- 1. Selected Economic and Financial Indicators, 2012-19 -- 2. Financial Operations of the Central Government, 2012-19 (Billions of CFA francs) -- 3. Financial Operations of the Central Government, 2012-19 (In Percent of GDP) -- 4. Monetary Survey, 2012-19 -- 5. Balance of Payments, 2012-19 -- 6. Quantitative Performance Criteria and Indicative Targets (March 2013-December 2013) -- 7. Quantitative Performance Criteria and Indicative Targets (March 2014-June 2015) -- 8. Prior Actions and Structural Benchmarks, 2013 -- 9. Prior Actions and Structural Benchmarks, 2014 -- 10. Newly Proposed Structural Benchmarks, 2015 -- 11. Indicators of Capacity to Repay the Fund, 2014-25 -- 12. Proposed Scheduled Disbursements under the ECF Arrangement, 2012-15 -- 13. Indicators of Financial Soundness, December 2008-June 2014 -- 14. Risk Assessment Matrix (RAM) -- APPENDICES -- I: Letter of Intent -- Attachment I. Memorandum of Economic and Financial Policies -- Attachment II. Technical Memorandum of Understanding -- CONTENTS -- RELATIONS WITH THE FUND -- JMAP BANK-FUND MATRIX -- STATISTICAL ISSUES

KEY ISSUESContext: Madagascar is one of the poorest countries in the world. Weak economic growth has contributed to persistent and increasing poverty with deteriorating social indicators. In a fragile environment, the uncertainty linked to political instability, weak institutions, and weak governance has eroded the foundation for solid economic growth, with short-term rent-seeking having taken precedence over longer-term nation building.Outlook and Risks: The authorities are at a crossroads. A well-prioritized medium-term economic program that is implemented concertedly would increase growth a

OVERVIEW Chad approved its National Development Plan (NDP) for the period 2013-15 in May 2013. The NDP is considered the third poverty reduction strategy for Chad, following the ones adopted for the periods 2003-06 and 2008-11. It focuses on a sensible set of priorities, notably on (i) developing production capacities and job opportunities, (ii) mobilizing and developing human capital and combating inequality, poverty, and social exclusion, (iii) protecting environment and combating climate change, and (iv) strengthening governance. The NDP was built on lessons learned from the previous povert

Cover -- CONTENTS -- BACKGROUND: STRATEGY TO REVERSE ECONOMIC AND SOCIAL DECLINE -- GROWTH HAS IMPROVED, BUT NEAR TERM RISKS HAVE INCREASED -- ADJUSTING FISCAL POLICY TO ENSURE SUSTAINABLE FINANCING OF AUTHORITIES' GROWTH AND DIVERSIFICATION STRATEGY -- A. Financing the PSGE on a Fiscally Sustainable Basis -- B. Improving Competitiveness for Economic Diversification and Structural Transformation -- C. Enhancing Financial Access and Financial Stability -- IMPROVING THE QUALITY OF DATA FOR DECISION-MAKING AND MONITORING PROGRESS UNDER PSGE, AND FUND JURISDICTIONAL ISSUES -- STAFF APPRAISAL -- FIGURES -- 1. Growth Performance -- 2. Global Competitiveness Index Comparison (Position in the Ranking) -- 3. Selected Economic Indicators -- 4. No Fiscal Adjustment Scenario, 2014-2020 -- 5. Fiscal Indicators -- 6. 2013 Eurobond Interest Yield and Spread with 10 Year US Bond -- 7. Medium Term Outlook, 2014-2020 -- 8. Public Investment Management Index, 2011 -- 9. Business Environment and Governance -- 10. Financial Indicators -- TABLES -- 1. Selected Economic Indicators, 2012-20 -- 2. Central Government Accounts, 2012-20 -- 3. Central Government Accounts, 2012-20 -- 4. Monetary Survey, 2012-20 -- 5. Balance of Payments, 2012-20 -- 6. Financial Soundness Indicators for the Banking Sector, 2009-13 -- ANNEX -- Risk Assessment Matrix -- APPENDICES -- I. PSGE Track Record -- II. External Sector Assessment -- III. Reform of Fuel Subsidies: Progress and Remaining Agenda -- CONTENTS -- RELATIONS WITH THE FUND -- RELATIONS WITH THE WORLD BANK -- STATISTICAL ISSUES