IMF releases $498.4m for Ecuador

Ecuador is the only South American country -apart from Argentina- to have an IMF lending program in place.

The International Monetary Fund (IMF) on Thursday approved a delayed loan for Ecuador, releasing nearly $500 million under a three-year program.

In a statement following a board meeting in Washington, the IMF said: “the Ecuadorian authorities have demonstrated a commitment to fiscal prudence, which remains key to fiscal sustainability.”

“Protecting the poor and increasing the social safety net are central priorities in the government’s program,” Mitsuhiro Furusawa, the fund’s deputy managing director, said.

And he said the government’s “recently approved tax reform will raise revenues and make the tax system more growth-friendly, simple and equitable.”

The IMF board gave the go-ahead for a $4.2 billion loan in March to support the nation’s economic reforms, but massive protests led by indigenous groups erupted in October when President Lenin Moreno scrapped fuel subsidies, causing gasoline prices to soar.

In November, The National Assembly rejected Moreno’s tax reform bill before approving a modified version in early December.

Sources: AFP, Financial Times.

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