The International Monetary Fund (IMF) is keen on supporting El Salvador in its bid for financial growth. In line with this, the financial agency is set to key into a fund-supported partnership program with the Central American nation.
IMF Proposes Strategic Plans to El Salvador
These plans were revealed in a recent report where the agency noted that it plans to broaden the scope of its support to El Salvador, which previously bordered mainly on helping the government to improve its public wage bill.
Now, the agency is taking the support over and beyond to include tending to the needs of El Salvador even in the areas of essential social and infrastructure expenses.
Majorly, the recent efforts by the IMF are targeted at boosting El Salvador’s public finances. However, as much as the agency hopes to achieve this, it also seeks to ensure that transparency becomes a strong pillar of El Salvadoran governance and financial transactions. To this end, the IMF has also revealed plans to help the government manage risks that come with digital assets.
According to the IMF, it has already reached a pact with the El Salvadoran government on this arrangement. This means that the country will adopt the strategies proposed by the agency to manage the considerable amount of Bitcoin it holds in its possession. Not only that. El Salvador will now also look to the IMF for the stabilization of its public debt.
Notably, the strategy of the IMF seeks to reduce local funding by all means necessary. That is, even if it means getting help from the IMF and other multilateral development banks. Over time, this move is expected to strengthen the nation’s reserve, albeit gradually.
Issues Further Advisory
Interestingly, the IMF has also issued an advisory on El Salvador’s exposure to Bitcoin. Although it admits that any substantial risk is yet to surface, it cautions that the country must remain wary of the coin at all times.
Overall, the IMF team says it will work with the El Salvadoran authorities to enact policies that will secure the long-term stability and prosperity of the nation.
