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The Central African Republic (CAR) has received optimism from the International Monetary Fund (IMF) a year after adopting Bitcoin (BTC). The IMF’s positive outlook reflects the country’s economic outlook and the impact of the use of the leading cryptocurrency.
The IMF has released a report expressing a more positive outlook on the country’s economic outlook for 2023. The report points to a projected rebound in real gross domestic product (GDP) growth to 2.2%, driven by factors such as the base effect and policy adjustments fueling fuel injection. The IMF also projects an average inflation rate of 6.3% in 2023.
According to the IMF document, the CAR’s projected public debt is expected to remain sustainable. However, the report highlights the presence of significant liquidity risks, as evidenced by the relevant debt indicators. These risks arise from a potential lack of donor support and problems with access to domestic and regional markets.
The CAR made history by becoming the second country in the world after El Salvador to accept Bitcoin as legal tender. Despite being one of the poorest countries in the world, the CAR is harnessing the power of Bitcoin to reshape its financial infrastructure and improve its economic outlook.
With the approval of bitcoin as legal tender in the CARs, the government wasted no time laying the groundwork for digital currency integration. CAR President Faustin-Archange Touadera spoke about an initiative called the Sango Project, which marked the country’s entry into the world of cryptocurrencies.
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In December 2022, the CAR announced a delay in the listing of Sango Coin on cryptocurrency exchanges. The decision was due to prevailing market conditions and marketing considerations. On March 31, the entity behind Sango Coin announced further delays of “just a few weeks”, citing legal and regulatory hurdles.
In January 2023, the Sango project reported that a government task force was actively working on amendments to the legislation to ensure the smooth integration of cryptocurrencies.