IMF flags fragile emerging markets

The International Monetary Fund used its spring meetings in Washington to warn that poorer and mid-sized economies are entering a new shock with too little room to absorb it. (imf.org) At the April 13-18 meetings, the Fund said the global economy had been hit by the Middle East war, the closure of the Strait of Hormuz and damage to energy facilities, reviving inflation risks and cutting growth momentum. (imf.org, imf.org) Mozambique is one of the clearest cases. The IMF said on April 23 that it plans to send a team in June to advance talks on a new loan programme after Mozambique’s previous IMF support programme ended in early April 2025. (money.usnews.com, clubofmozambique.com) The Fund said Mozambique needs faster fiscal consolidation, more exchange-rate flexibility and governance reforms as it deals with rising debt, a shrinking economy and delayed gas projects. (money.usnews.com, clubofmozambique.com) In Ghana, the warning is different: do not treat programme exit as the end of the crisis. Nana Osei-Adjei, a member of parliament’s Public Accounts Committee, said on April 23 that Ghana should keep building fiscal buffers before leaving its IMF programme in the coming months. (thebftonline.com) Ghana’s central bank has said the country remains on track to leave its $3 billion Extended Credit Facility programme in May 2026, after inflation slowed to 9.4% and reserves rose to 4.5 months of import cover. The caution from Accra is that commodity-price swings, tighter global financing and war-driven energy shocks can reverse those gains quickly. (graphic.com.gh, thebftonline.com) Bahrain shows the same problem from another angle. Analysts told AGBI in March that Bahrain entered the Iran conflict with the weakest fiscal position in the Gulf, after public debt reached 133.4% of gross domestic product in 2024 and was projected at 146.4% in 2026. (agbi.com) Bahrain approved an 11-part fiscal package in December that raised utility and fuel prices for businesses, introduced a corporate tax and cut administrative spending by 20%, but analysts said missile strikes, shipping disruption and higher inflation could force the kingdom to borrow more or seek fresh regional support. Bahrain’s finance ministry did not comment in the AGBI report. (agbi.com) The IMF’s message across these cases is narrower than a recession call and broader than country-by-country advice: countries that spent the last three years stabilising inflation, debt and currencies are now being told to keep cash, reserves and borrowing capacity in hand. For Mozambique, Ghana and Bahrain, the next test is not whether reform plans exist on paper, but whether they hold through another external shock. (imf.org, money.usnews.com, thebftonline.com, agbi.com)