Market
How much additional funding will El Salvador secure from development banks by end of 2025?
3
Resolution / Starting Odds
Less than $1 billion • 25%
$1-2 billion • 25%
$2-3 billion • 25%
More than $3 billion • 25%
Official announcements from development banks or the Salvadoran government
Story
El Salvador Secures $1.4 Billion IMF Loan Under 40-Month EFF, Scales Back Bitcoin Strategy and Chivo Wallet
Dec 18, 2024, 10:01 PM
El Salvador has reached a staff-level agreement with the International Monetary Fund (IMF) for a $1.4 billion loan under a 40-month Extended Fund Facility (EFF) arrangement after four years of negotiations. The agreement, which is subject to approval by the IMF's Executive Board, aims to support the government's economic reforms and strengthen fiscal and external sustainability. In exchange for the loan, El Salvador has agreed to scale back its Bitcoin strategy, making acceptance of Bitcoin voluntary for the private sector and limiting public sector involvement in Bitcoin-related activities. The government will also gradually reduce its role in the Chivo digital wallet program. The deal is expected to unlock additional funding from development banks, potentially bringing the total financing package to over $3.5 billion. El Salvador's debt, which peaked at 85% of GDP in 2024, will be addressed by improving the primary balance by about 3.5% of GDP over three years. Meanwhile, taxes will continue to be paid in U.S. dollars.
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Significant positive impact • 25%
Moderate positive impact • 25%
No significant impact • 25%
Negative impact • 25%
Improved fiscal balance • 25%
Increased GDP growth • 25%
Reduced inflation • 25%
No significant impact • 25%
No change • 25%
Increased lending • 25%
Decreased lending • 25%
Uncertain outcome • 25%
Increased GDP growth • 25%
No significant impact • 25%
Debt reduction • 25%
Reduced inflation • 25%
No • 50%
Yes • 50%
Infrastructure projects • 25%
Other • 25%
Social programs • 25%
Debt repayment • 25%