IMF Loans Honduras US$113.9 Million for Economic Reforms

Honduras Weekly
The International Monetary Fund (IMF) on Friday announced it will lend Honduras US$113.9 million to continue supporting the economic reform program of President Porfirio Lobo, and specifically to help the government subsidize key commodities in the short-term due to recent sharp increases in international prices for raw materials, easing any sudden shocks to the poor. The IMF, which extended US$83.4 million in credit to Honduras in April, has expressed its approval of the Lobo administration's efforts to attract private investment and expand exports to increase the country's gross domestic product (GDP). According to the IMF's Naoyuki Shinohara, "The Honduran economy experienced a gradual recovery in 2010, backed by solid macroeconomics and major access to official foreign financing." He noted that the economy grew by 2.8 percent, inflation was kept low, international monetary reserves grew considerably, and confidence by the private sector improved. In order for Honduras to stay on course in reducing its annual budget deficits and maintaining a stable balance between its public debt and GDP, Mr. Shinohara has advised the government to implement without delay measures to strengthen the administration of its tax collection system and exercise strict control on current spending. (7/31/11)