LatinNews Daily - 17 June 2024

In brief: IMF signs off on more funds for Costa Rica

*The International Monetary Fund (IMF)’s executive board has concluded the sixth and final review under the Extended Fund Facility (EFF) for Costa Rica, allowing for a disbursement equivalent to about US$272m. According to an IMF statement, the Fund’s executive board also concluded the third and final review under Costa Rica’s Resilience and Sustainability Facility (RSF) arrangement, making available about US$243m of Costa Rica’s climate change agenda. The IMF notes that Costa Rica is the first member to complete an RSF arrangement. Approved on 1 March 2021 for US$1.78bn, Costa Rica’s three-year extended arrangement under the EFF was extended by five months on 25 March 2022. Meanwhile its RSF arrangement was approved on 14 November 2022, for US$725m. The IMF statement notes that the sixth EFF and third RSF reviews mark the final reviews of both arrangements and cites the IMF’s deputy managing director, Kenji Okamura, as saying that: “The completion of the reviews marks the successful conclusion of an ambitious, multi-year, multi-dimensional reform programme, under which the authorities demonstrated strong commitment to a broad-based homegrown reform programme that is helping reshape Costa Rica’s economy and advance the climate agenda.” It cites Okamura as highlighting “strong” growth, which the IMF notes “accelerated to 5.1% in 2023 and is projected to remain robust at 4% in 2024”. The IMF statement also highlights that while inflation (year-on-year) has stayed negative since mid-2023, it is “rising to the lower end of the central bank’s tolerance range” (2-4%) which it is expected to reach by late 2024.

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