Modest economic recovery predicted

The ‘Economist Intelligence Unit’ has predicted a “modest” economic recovery for Burundi this year. It recalled that the IMF concluded negotiations with the government early last month and presented its conditions for renewed support such as reduction of military expenditure, unification of the exchange rate, closer banking supervision and a reduction in public expenditure. The EIU noted the “contentious” nature of these conditions and warned it was unlikely the government would be able to comply with them before the political situation stabilised and it had access to other donor funds.

“The government has been shaken by several public sector strikes since January and politically can ill afford renewed confrontation over expenditure cuts, while it has repeatedly stated that its military budget is non-negotiable for as long as the war continues,” the EIU stated. It added that to regularise its relations with foreign donors, the government will have to clear its external arrears, particularly with multilateral donors.