Saturday, April 25, 2009

IMF Executive Board Approves US$935 Million Stand-By Arrangement for Guatemala

The Executive Board of the International Monetary Fund approved on April 22 an 18-month, SDR 630.6 million (about US$935 million, or 300 percent of quota) Stand-By Arrangement for Guatemala. The Guatemalan authorities intend to treat the arrangement as precautionary, meaning that they do not intend to draw on the Fund’s resources unless the need arises. Guatemala has no immediate balance of payments need, and this program is part of a comprehensive preventive strategy to strengthen the country’s liquidity cushion in the face of an uncertain global environment, thereby enhancing the confidence of investors and market participants.

Guatemala has made substantial progress in consolidating macroeconomic stability and implementing structural reforms. Adverse external conditions, however, are affecting economic activity and financial conditions. The Guatemalan authorities have taken a number of upfront measures to mitigate the impact of the external shock and preserve macroeconomic stability. The program will support the authorities’ policies and provide insurance against significant downside risks.

Following the Executive Board discussion on Guatemala, Mr. Murilo Portugal, Deputy Managing Director and Acting Chair, issued the following statement:

“Guatemala has a strong track record of prudent macroeconomic policies and structural reforms, which has helped to solidify the economy in recent years. As in many countries in the region, however, the global crisis has weakened economic conditions. A more prolonged global recession could increase downside risks to Guatemala’s outlook in 2009 and 2010. The authorities’ economic program, supported by a Stand-by Arrangement with the Fund, which the authorities plan to treat as precautionary, is an appropriate response to mitigate these risks and preserve macroeconomic and financial stability.

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California Assemblywoman Receives Guatemala's Highest Cultural Honor

State Assemblywoman Norma Torres (D-Pomona) received the highest Guatemalan cultural award on Monday from Guatemala's Ambassador of Indigenous Peoples, Don Alejandro Cirilo Perez Oxlaj. The Guatemalan community gave Sacramento State a set of books detailing Guatemala's history.