IMF approves disbursement of further EUR 1.4bn tranche of loan to Hungary
Budapest - The International Monetary Fund (IMF) announced on Tuesday that it would immediately disburse a further EUR 1.4bn tranche of the EUR 20bn stand-by loan that the organization granted to Hungary together with the EU and the World Bank last November.
TETSZETT A CIKK?
Ossza meg az alábbi közösségi oldalakon is:
iwiw
Delicious
Digg
Facebook
GReader
URLGuru
StumbleUpon
Tumblr
Twitter
Többre kíváncsi? Iratkozzon fel a hírlevelünkre, RSS-feedünkre!
nyomtatás |
Küldés e-mailben
|
A+ | A- |
Megosztom
The IMF said that it had approved disbursement of the tranche after completing its second review of Hungary's economic performance in accordance with the stand-by arrangement, noting that the organization has now disbursed EUR 8.4bn of the EUR 20bn loan.
IMF First Deputy Managing Director John Lipsky said "Weaker than expected external demand and tighter external financing conditions exacerbated the recession in Hungary.
In these circumstances, policy settings have been revised to strengthen fiscal sustainability and preserve financial stability.
More ambitious structural spending and tax reforms are under way to strengthen fiscal sustainability, allowing the partial accommodation of automatic stabilizers and an increase in the fiscal deficit target in 2009. The authorities' commitment to the firm and timely implementation of appropriate policies is reassuring. "
Mr Lipsky commented that "Fiscal sustainability is being strengthened through structural spending reforms, while allowing an increase in the fiscal deficit in 2009, owing to the partial operation of automatic fiscal stabilizers.
The permanent budgetary savings from expanded reforms to the pension system, social transfers, and subsidies are encouraging. These reforms, together with tax reform that will shift the tax burden from labor to consumption and wealth should boost labor participation and potential growth over the medium-term."
The IMF managing director added that "The prompt implementation of the authorities' revised program to preserve financial stability, including the careful monitoring of banks that receive government financial support and strengthening bank supervision, are important steps.
It is recommended that the authorities explore institutional arrangements that would provide the financial supervisory agency with the necessary regulatory powers, and that remedial action and bank resolution frameworks be quickly strengthened."
"Monetary and exchange rate policy will continue to target inflation over the medium term, while being prepared to act as needed to mitigate risks to financial stability and avoid risks to destabilizing the exchange rate.
Looking ahead, a further strengthening of investor confidence and a corresponding easing of financial strains would create room for interest rate cuts," Mr Lipsky stated.
