The Executive Board of the International Monetary Fund (IMF) approved a 27-month extended arrangement under the Extended Fund Facility for Ecuador on September 30, 2020. Under the new deal, Ecuador has already received a disbursement of $2 billion to ease the economic effects of the pandemic. As explained in the IMF Country Report 20/286, the country will receive a total of $6.5 billion in order to stabilize the economy, expand the coverage of social assistance programs, ensure fiscal and debt sustainability, and strengthen domestic institutions to lay the foundations for strong, job-rich, and long-lasting growth that benefits all Ecuadorians.
Shortly after the Executive Board’s meeting, Kristalina Georgieva, Managing Director and Chair of the IMF, stated that “the authorities have committed to unwind the crisis-related measures as the economy starts to recover. Fiscal sustainability would be anchored on the debt ceiling under the homegrown organic budget code (COPLAFIP) of 57 percent of GDP by end-2025. It would be underpinned by a combination of a progressive tax reform over the medium-term and expenditure measures that aim to align Ecuador with regional peers.”
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