Agreement between the IMF and Ecuador
The International Monetary Fund (IMF) has been aware of the decisions that it takes Ecuador as a state, for the fulfillment of the goals established in the past and to propose the veracity of its projections for 2019.
In general, the IMF's technical commission seeks to ensure the country's economic development to continue with the monetary disbursement of 4200 million dollars that the fund granted in the past. It should be remembered that the IMF gave economic support and the country was able to reduce its risk of defaulting by percentage.
Since the end of May, it was known that the manager of the Central Bank of Ecuador (ECB) i give a positive balance in terms of reviewing the goals and objectives of the country. Raising a goal that although logical, did not have minimum income support. That is to say, that the income of public companies should be higher than their expenses. So, the government must create a policy of reducing expenses to ensure that public companies are sustainable and do not work at a loss.
Although the Ecuadorian Business Committee (CEE) he said that the adjustments had to be made with established dates, the government has not pronounced. Although the businessmen claimed to eliminate the green tax as a first measure. Now, the EEC said that they are concerned that one of the ways to achieve productivity is that the government increases the VAT of Ecuador.
However, in recent news it was known that the country under its growth projection from 1.4% to only 0.2% by 2019, that is, the growth is low, but not negative. More information of this aspect in:
Ecuador's economic growth will only be 0.2%, forgetting to grow the 1.4% raised by the government. The Ecuadorian Gross Domestic Product (GDP) grew by 2.4% in 2017 and compared to the crisis due...webmediums.com
The IMF loan is the largest of a larger loan, that exceeds 10,000 million dollars: the remaining 6,000 million come from the World Bank, the Inter-American Development Bank (IDB), the CAF-Development Bank of Latin America, the European Investment Bank (EIB), the Latin American Reserve Fund (FLAR) and the French Development Agency.
Among the commitments for which Ecuador showed interest and seeks agreement with the IMF are:
Strengthening the institutional framework of the Central Bank. Strengthen the resilience of the financial system. Restore prudence in fiscal policy. Support for job creation, competitiveness and growth. Promote shared prosperity and protect the poor and vulnerable. Promote transparency and good governance.
However, this is only part of a large number of petitions that include labour reform to the way Ecuadorians do their shopping. The support of neighboring countries will be key to the fiscal and economic reform of the country, because contraband is one of the points to work.