IMF staff and Salvadoran authorities have reached a staff-level agreement on the first review of El Salvador's extended arrangement under the Extended Fund Facility (EFF). Discussions also concluded on the 2025 Article IV consultation, focusing on enhancing El Salvador’s medium-term growth prospects.
Mr. Cubeddu, Deputy Director of the Western Hemisphere Department, and Mr. Torres, Mission Chief for El Salvador, stated: "IMF staff have reached staff-level agreement with the Salvadoran authorities on the first review under the 40-month EFF arrangement. The agreement is subject to approval by the IMF’s Executive Board, and contingent on the implementation of the agreed prior actions."
The statement highlighted that significant progress has been made in implementing economic reforms under the IMF-supported program. Most targets for this review were met comfortably, and structural benchmarks are progressing well. Despite external challenges, El Salvador's economy continues to grow due to improved confidence and robust remittances. Prudent policies have contributed to reduced inflation and a lower current account deficit.
The statement further noted: "There is a shared understanding that steadfast program implementation and agile policy making, in the context of rising global uncertainties, remain critical to further entrench stability and lay the foundation for stronger and more sustainable growth. IMF staff thank the Salvadoran authorities for excellent collaboration and constructive discussions."
The EFF was approved by the IMF Executive Board on February 26, 2025, with total access of SDR 1033.92 million (approximately US$1.4 billion or 360 percent of quota), including an initial disbursement of SDR 86.16 million. Additional financial support from other official creditors totals roughly US$3.5 billion.