LatinNews Daily - 19 April 2023

In brief: El Salvador bars publication of IMF report

* The International Monetary Fund (IMF) has said that Salvadorean authorities have not consented to the publication of a staff report and related press release following the IMF board’s conclusion of its consideration of the 2023 Article IV consultation on El Salvador on 20 March. The IMF highlights that under Article IV of its Articles of Agreement, the IMF has “a mandate to exercise surveillance over the economic, financial and exchange rate policies of its members in order to ensure the effective operation of the international monetary system”. It adds that “IMF economists visit the member country, usually once a year, to collect and analyse data and hold discussions with government and central bank officials”. Following their return, the staff submit a report to the IMF’s executive board for discussion and the board’s views are then summarised and transmitted to the country authorities. El Salvador’s populist government led by President Nayib Bukele had previously said it was seeking a US$1.3bn finance arrangement with the IMF through a 36-month Extended Fund Facility (EFF) but these plans appear to have unravelled over the Bukele government’s decision to make bitcoin legal tender in September 2021. Nonetheless on 13 April Nigel Chalk, the acting director of the IMF’s Western Hemisphere department, said that the IMF is “engaging with the country authorities in El Salvador…. there is a potential for a programme there [although] I don't think, again, we've had a request for a programme”.

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