Following the conclusion of a mission by the International Monetary Fund to El Salvador, headed by Raphael Espinoza, the multilateral organization recognized the measures taken by the government of the Central American country in order to address macroeconomic imbalances, strengthen public finances and increase banks’ “reserve buffers”.
On the fiscal front, agreements were reached for an adjustment in the primary balance of close to 3.5% of GDP over a three-year period, in order to align public debt with the sustainability of its execution. This goal is expected to be consolidated through a rationalisation of the public payroll while creating a margin for social and infrastructure investment.
To strengthen the reserve mechanisms of the Salvadoran financial system, Reinforcements aimed at reducing the Government’s dependence on internal financing will be supported through planned consolidation and possible IMF support and other multilateral banks.
“Progress has been made in negotiations towards a Fund-supported program focused on policies to strengthen public finances, “increase banks’ reserve buffers, improve governance and transparency, and mitigate bitcoin risks”said Raphael Espinoza, leader of the IMF mission in El Salvador.
Now, on cryptocurrency issues, both multilateral banking and the government of that country They recognize the need to implement greater efforts in transparency, mitigation of tax effects and financial stability of bitcoin. Further project oversight discussions will be held.
Finally, the IMF established a series of strategies to improve the climate for investors through better governance and transparency. Authorities in El Salvador are already preparing legislative proposals to address corruption, money laundering and procurement weaknesses.
