Pozo and his team, which includes the president of the central bank, will provide the IMF with details on the budget. It was the lack of detail on how the country was meeting the fiscal deficit targets that prompted the IMF to suspend the review.
Finance ministry officials said that the increase in teachers' wages, which was agreed in order to settle the recent strike (WR-03-23), would lead to US$20m in extra spending.
The teachers' pay rise is to be phased in from October. The week-long (9-17 June) strike in the oil industry had also had an effect on the revenue side, officials said.
Besides the effect of the teachers' settlement and the oil strike, the IMF is also concerned about the government's plans to end duties on raw materials and about opposition in congress to the proposed reforms to the tax system and labour laws.
The IMF cash is seen by analysts as essential for Ecuador to keep servicing its debt load. The central bank is confident that the IMF will disburse the US$42m before the end of August. It did admit that the delay would have some cashflow consequences.
The country has asked the IMF to revise the timetable for monitoring and disbursements on several occasions.
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