IMF and El Salvador reach staff-level deal for $140 million disbursement

The International Monetary Fund announced a staff-level agreement with El Salvador on Thursday to complete the second and third reviews of its 40-month Extended Fund Facility program, which would enable a disbursement of about USD 140 million pending approval by the IMF's Executive Board. The final decision depends on the Salvadoran government fulfilling prior actions agreed under the program. The IMF stated that El Salvador's economy outperformed projections during 2025, estimating GDP growth of 4.5% in 2026, supported by private investment, consumption, remittances, tourism, and capital flows. The agreement includes deepening fiscal consolidation, targeting a primary surplus increase from 2.9% of GDP this year to 3.7% in 2027, alongside pension system reforms and civil service changes. The review also addressed the Chivo wallet, noting that state participation was substantially reduced with majority ownership transferred to a private operator, while the government retains a minority stake. The IMF said Bitcoin accumulation since the first review came from private donations, not public resources, with no further accumulation expected beyond documented donations.