IMF Agrees Stand-By for Guatemala

The IMF is extending an 18-month stand-by agreement for approximately $950m to Guatemala. The bank says that the arrangement is precautionary, as the country has no immediate balance of payments need, and that the program is part of a preventive strategy to strengthen Guatemala’s liquidity cushion in the face of an uncertain global environment. Under such stand-by agreements, the sovereign does not pay any interest until it draws on the facility. In early March, Costa Rica was also in talks with the IMF for a stand-by, but no agreement has been reached yet.