Rodrigo Chavez said on Monday, the day after his victory in the presidential election in Costa Rica, that he wanted to “improve” the agreement signed with the International Monetary Fund (IMF) for the outgoing government to borrow 1.7 percent. using “more ambitious” forecasts for the growth of the Central American country’s economy.
“The IMF is not a source of resources for the government’s financing needs. We have conceived of it as a tool to give confidence to those who are called upon to lend us money, (as proof) that Costa Rica will honor its debt obligations,” he said. Chavez, executive of the World Bank for thirty years.
The Fund needs to know that “more ambitious policy measures for economic recovery and fiscal responsibility” are needed in order for Costa Rica to secure funding from other agencies and borrowing markets, the conservative president-elect explained.
“We are not going to loosen our commitment (to the IMF) for a sound and responsible fiscal policy,” he said.
At the end of March, the Fund approved the disbursement of the second tranche of $ 284 million provided under the contract signed on March 1, 2021, while giving San Jose more time to implement the promised reforms to reduce the deficit.
The IMF has mainly called for the adoption of a law on public pensions and salaries, in order to reduce government spending.
Costa Rica ended 2021 with a deficit of 5.18% of GDP, compared to 8.03% in 2020. Public debt exceeded $ 42.4 billion (over 70% of GDP).
SOURCE: AMPE
Source: Capital
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