Costa Rica, IMF Reach Provisional Deal On $1.75Bln Lifeline

Costa Rica, IMF Reach Provisional Deal on $1.75Bln Lifeline

The International Monetary Fund and Costa Rica reached a provisional deal on a $1.75 billion loan from the lender in return for fiscal reforms, the head of the IMF mission to the island nation announced

MOSCOW (Pakistan Point News / Sputnik - 23rd January, 2021) The International Monetary Fund and Costa Rica reached a provisional deal on a $1.75 billion loan from the lender in return for fiscal reforms, the head of the IMF mission to the island nation announced.

"I am pleased to announce that the Costa Rican authorities and the IMF mission team have reached a staff level agreement on economic and structural policies and reforms that would underpin a three-year arrangement ... for about US$1.75 billion," Manuela Goretti said.

The agreement needs to be ratified by both the IMF management and Costa Rican parliament.

Costa Rica was hit hard by the coronavirus pandemic. The shock exacerbated its already precarious economic condition, drove unemployment upwards and widened the financing gap, undermining fiscal reforms launched in 2018.

The Tico Times, a Costa Rican newspaper, reported that the loan would come at the cost of budget cuts, pension freezes and a reduction of tax exemptions, among other conditions.