IMF optimism in Central African Republic, despite Bitcoin adoption

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IMF optimism in Central African Republic, despite Bitcoin adoption
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The Central African Republic (CAR) has received optimism from the International Monetary Fund (IMF) one year since it adopted Bitcoin (BTC). The IMF’s positive outlook reflects the country’s economic prospects and the impact of embracing the leading cryptocurrency.

The IMF published a report expressing a more positive view of the country’s economic prospects for 2023. The report indicates a projected rebound in real gross domestic product (GDP) growth to 2.2%, attributed to factors such as the base effect and policy adjustments leading to enhanced fuel supply. The IMF also anticipates an average inflation rate of 6.3% for 2023.

According to the IMF document, the projected public debt of the CAR is expected to remain sustainable. However, the report highlights the presence of significant liquidity risks, as indicated by relevant debt indicators. These risks arise from potential shortfalls in donor support and challenges in accessing domestic and regional markets.

The CAR made history by becoming the second country in the world, after El Salvador, to adopt Bitcoin as a legal tender. Despite being one of the poorest nations in the world, the CAR is harnessing the potential of Bitcoin to reshape its financial infrastructure and boost its economic prospects.

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Following the approval of Bitcoin as legal tender in CAR, the government wasted no time in laying the groundwork for digital currency integration. CAR President, Faustin-Archange Touadera, revealed the initiative called Sango Project, marking the country’s entry into the world of cryptocurrencies.

Related: IMF sees room for eNaira improvement in first-year assessment

In December 2022, the CAR announced a delay in the listing of Sango Coin on crypto exchanges. The decision was attributed to prevailing market conditions and marketing considerations. On March 31, the organization behind Sango Coin announced further delays “just for a few weeks,” citing legal and regulatory obstacles.

In January 2023, the Sango Project revealed that a government task force is actively working on legal amendments to enable the smooth integration of the cryptocurrency.

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