Questions in the News
Responses to Questions About IMF Policies and Country Operations
Nicaragua
Last Updated: July 12, 2007| Question: The Fund has said that it supports key elements of the Nicaraguan authorities' macroeconomic framework for 2007 through 2010. Does this mean that the Fund is close to reaching an agreement on a new program with the Nicaraguan authorities? |
| Answer:
MR. HAWLEY: The Nicaraguan authorities have prepared a substantive and wide-ranging proposal of which the main goal is to reduce poverty in a decisive way and to move forward to achieving the UN Millennium Development Goals. Moreover, they have stressed the importance of achieving these developmental objectives in the context of a stable and sustainable macroeconomic policy framework. The IMF staff mission reached an agreement with the country on a program that could be supported by a new PRGF program. This of course is the case in any program agreement that needs to be approved by the Fund's Executive Board. In the coming weeks the authorities and the Fund's staff will work to complete the remaining technical details of the proposed program that would be supported by the Fund.
July 12, 2007 Transcript of a Press Briefing by David Hawley, Senior Advisor, External Relations Department, IMF |
| Question: The IMF has just announced that Nicaragua has reached the last phase of qualifying for debt relief, its completion point, under the Heavily Indebted Poor Countries (HIPC) Initiative. Has the IMF established mechanisms to monitor economic policies in Nicaragua to ensure it avoids the problems of the past? |
| Answer:
The authorities recognize the need for continuing sound economic policies. That recognition has its own curative effect in ensuring that policies are maintained. In addition, the IMF enjoys a good relationship with Nicaragua even beyond the HIPC process. We have a resident representative in Nicaragua. We will remain in touch with authorities through our normal surveillance process. Finally, with higher growth projected for the region this year, Nicaragua is likely to enjoy a favorable economic environment.
January 28, 2004 Press Briefing by Thomas C. Dawson, Director, External Relations Department, IMF |
| Question: What is the status of Nicaragua's debt-reduction program? |
| Answer:
The IMF and the World Bank's International Development Association (IDA) have announced that Nicaragua has taken the steps necessary to reach its completion point under the enhanced Heavily Indebted Poor Countries (HIPC) Initiative. That will reduce Nicaragua's total external debt by approximately 73 percent in net present value terms—a reduction of approximately $4.5 billion over time—in recognition of the government's satisfactory progress in implementing sound macroeconomic and structural policies. The IDA will provide debt relief under the enhanced HIPC Initiative amounting to $382.6 million in debt service relief ($190.9 million in net present value terms), to be delivered through a 90 percent reduction in debt service on IDA credits from 2001 through 2023. The IMF will provide debt relief of approximately $106.5 million ($82.2 million, or SDR 63.5 million, in net present value terms) on payments falling due to the IMF during 2002-09. The remaining bilateral and multilateral creditors are also expected to provide their share of relief required under the enhanced HIPC Initiative. Resources made available by debt relief provided under the HIPC Initiative are being allocated to fund key pro-poor growth programs, which are outlined in Nicaragua's Poverty Reduction Strategy Paper.
January 23, 2004 Press Release: IMF and World Bank support $4.5 billion in debt service relief for Nicaragua |