The IMF’s mandate is part of Article IV. 2022 was also held at the end of January last year.
A technical mandate from the International Monetary Fund (IMF) is due to assess the Salvadoran economy in the days after the government completes the $800 million disbursement. Note From Reuters.
The meeting began on January 30th and is part of the annual review conducted by the Monetary Fund as part of Article 4.
At this meeting, the IMF team will meet with officials from the government, the Legislative Assembly, economists, and other social stakeholders to assess the economic and financial situation of the Salvadoran economy.
The president of the republic, Naive Bukele, announced on Monday that his government complied with the payment of bonds that expired on January 24. A warning put it in the market’s field of view.
To reassure the market, the government has launched two early buy-back operations in 2022 for the 2023 and 2025 bonds. From the first issuance, an agreement was reached for $175.87 million, which equates to him $604 million paid on Monday. Interest of $23.4 million.
Of the 2025 issuance, the government announced purchase commitments of $451 million, leaving an outstanding balance of $448 million.
Finance Minister Alejandro Zelaya assured this Wednesday that the state of El Salvador has saved $288 million in early purchases for the 2023 issue as interest payments. Resources to keep its promises came from “increased” tax collection, cuts in public spending and “cooperation of multilateral organizations,” officials asserted.
He denied that the loans granted by multilateral institutions, mainly CAF and CABEI, were directed toward spending, but defended them as strengthening the country’s coffers. “It’s for the general financial fund, you can’t say it’s the only source of funding.”
The debt ratio is low, but the balance is high.
The non-financial public sector (SPNF) outstanding debt will reach $24,102.7 million as of November 2022, representing 75.8% of the estimated Gross Domestic Product (GDP) for that year.
Zelaya said the debt ratio had fallen by almost 10 percentage points from its peak recorded in 2020, when it accounted for 85.8% of GDP, but the balance stood at another $838.9 million as of November 2021, i.e. December 2020. celebrated an increase of $2.45 billion compared to the results of When the SPNF outstanding debt he was at $21,651.9.
This difference is partly explained by the fact that 2020 GDP was much smaller due to the contraction of the economy due to the covid-19 pandemic, but this 2022 economy is growing beyond pre-pandemic figures. increase.