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Andean Group - March 2019

Economic Highlights

ECUADOR | Agreement with IMF. This month the International Monetary Fund (IMF) approved a US$4.2bn arrangement under the IMF’s Extended Fund Facility (EFF) for Ecuador – a move which signals the repair of relations between the government led by President Lenín Moreno and the IMF which had deteriorated under President Moreno’s predecessor, Rafael Correa (2007-2017). First announced last month by President Moreno – who has previously claimed that he inherited a “broken country” from Correa – the plan enables the immediate disbursement of US$652m which provides support for the Ecuadorean government’s economic policies over the next three years. According to an IMF press release, the Ecuadorean authorities’ plan is centred around four major priorities: “boosting competitiveness and job creation; strengthening fiscal sustainability and the institutional foundations of Ecuador’s dollarisation; protecting the poor and most vulnerable; and improving transparency and bolstering the fight against corruption”. The agreement with the IMF follows austerity measures announced last year by the Moreno government aimed at reducing the fiscal deficit such as the ending of government subsidies on high-octane ‘súper’ petrol fuels.

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