IMF Funds for Ecuador, Argentina Plus New Request from Costa Rica

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IMF board concludes reviews for Ecuador, unlocking $1 billion

Anti-government protests in Quito

A woman and girl push their bikes past closed produce stalls at a market during anti-government protests as opposition lawmakers push for the removal of Ecuador’s conservative President Guillermo Lasso after nearly two weeks of mass protests led by indigenous groups demanding lower fuel and food prices, in Quito, Ecuador June 24, 2022. REUTERS/Karen Toro

June 24 (Reuters) – The International Monetary Fund executive board said Friday it had concluded its fourth and fifth reviews for Ecuador’s 27-month Extended Fund Facility (EFF), allowing for the immediate disbursement of about $1 billion.

The board said Ecuadorian authorities planned to use the funds for budget support.

The announcement comes after nearly two weeks of sometimes-violent mass protests led by indigenous groups demanding lower fuel and food prices. read more

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Deputy Managing Director Antoinette Sayeh said in a statement that Ecuador’s 4.2% GDP growth in 2021 had been supported by good macroeconomic management and a successful vaccination campaign, and that macroeconomic and financial stability had been preserved.

“While the ongoing war in Ukraine is adversely affecting some export sectors, higher oil prices are improving Ecuador’s external and fiscal balances,” she said.

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The IMF approved a 27-month EFF arrangement for Ecuador worth about $6.5 billion on September 30, 2020.

Reporting by Brendan O’Boyle; Editing by Edwina Gibbs

IMF board approves Argentina first review, unlocks $4 bln

Senate debates the agreement with the International Monetary Fund (IMF), in Buenos Aires

People walk outside the National Congress, as the senate debates the government’s agreement with the International Monetary Fund (IMF) in Buenos Aires, Argentina March 17, 2022. REUTERS/Agustin Marcarian

June 24 (Reuters) – The executive board of the International Monetary Fund on Friday completed the first review of its $44 billion Extended Fund Facility for Argentina, its managing director said.

The approval allows for the disbursement of about $4 billion.

Kristalina Georgieva said on Twitter the approval marked the conclusion of an initial step under the program to support the country’s “ongoing economic recovery and strengthen stability.”

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A source familiar with the matter had previously confirmed the information to Reuters.

In a statement, the IMF said that notwithstanding shocks such as inflation pressures and challenging fiscal and reserve

accumulation goals, Argentine authorities have met “all end-March 2022 quantitative targets and have made progress toward implementing the structural commitments under the program.”

It added that it maintained the end-year program objectives with some flexibility in the quarterly paths to accommodate those shocks.

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Also on Twitter, Argentine Economy Minister Martin Guzman said the country will continue to implement macroeconomic policies in order to strengthen growth with “job creation and stability.”

The IMF announced on June 8 that it had reached a staff-level agreement on an updated macroeconomic framework with authorities in Argentina – the fund’s biggest debtor. It said at the time that “all quantitative program targets” for the first quarter of the year had been met.

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Argentine authorities did not immediately respond to requests for comment.

On Tuesday, Argentina’s government approved two payments to the IMF for some $2.75 billion.

Reporting by Jorgelina do Rosario in London; Additional reporting by Rodrigo Campos in New York and Nicolas Misculin in Buenos Aires; Writing by Carolina Pulice; Editing by Leslie Adler, Matthew Lewis and Sandra Maler

Costa Rica asks IMF for $700 million from new sustainability trust

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The Central Bank of Costa Rica's headquarters are pictured in San Jose

The Central Bank of Costa Rica’s headquarters are pictured in San Jose, Costa Rica February 12, 2020. REUTERS/Juan Carlos Ulate

SAN JOSE, June 25 (Reuters) – Costa Rica has told the International Monetary Fund (IMF) it is interested in obtaining a nearly $700 million loan to invest in infrastructure from a newly created fund, the Central Bank said.

Costa Rican authorities told the IMF that the country aims to be the first to secure financing from the IMF’s Resilience and Sustainability Trust (RST), announced in April, the Central Bank told Reuters on Friday.

“The Government is evaluating the conditions and opportunities to have access to these resources for infrastructure works,” the bank said.

The IMF launched the financing facility with the goal of helping low and middle-income countries tackle long-term challenges such as climate change and pandemics.

The IMF has said it plans to begin lending under the program by October.

Costa Rica reached a $1.78 billion agreement with the IMF in early 2021 to help the Central American country consolidate its finances after years of mounting debt. The IMF has so far disbursed nearly $570 million.

President Rodrigo Chaves, who took office in May just as Costa Rica’s debt was equivalent to 66.5% of Gross Domestic Product (GDP), has said he plans to strengthen the IMF program, but has not provided details.

IMF staff met for the first time with Chaves this month, and warned of a likely slowdown in Costa Rica’s economy this year amid external pressures including the ongoing pandemic and rising inflation.

Reporting by Alvaro Murillo Editing by Chizu Nomiyama
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