Costa Rica Receives IMF Approval for $500Mn After Economic Reforms

• The International Monetary Fund (IMF) allowed for the disbursement of over $500Mn to Costa Rica last Friday, June 14, after a successful review of the Central American country’s reform programs, the organization said in a statement.
• The IMF Executive Board concluded the sixth and final review under the Extended Fund Facility (EFF) for Costa Rica, allowing for a disbursement equivalent to about US$ 272Mn.
• Further, the IMF Executive Board also concluded the third and final review under Costa Rica’s Resilience and Sustainability Facility (RSF) arrangement, making available about US$ 243Mn in support of Costa Rica’s ambitious climate change agenda.
• “Costa Rica is the first country to complete an RSF arrangement,” which was launched to support poor or vulnerable countries in the face of long-term difficulties caused by global warming, according to the IMF.
• “The completion of the reviews marks the successful conclusion of an ambitious, multi-year, multi-dimensional reform program… that is helping reshape Costa Rica’s economy and advance the climate agenda,” Kenji Okamura, Deputy Managing Director of the IMF, said in a statement.
• The sovereign is expected to grow by 4.0% in 2024 and average 3.0% growth between 2025 and 2029, driven in particular by robust external demand, a recovery in foreign direct investment, and stronger household consumption. Furthermore, Costa Rica stands to benefit from the global "near-shoring" trend, especially in the healthcare and service-related export sectors.

(Sources: IMF & NCBCM Research)