IMF approves new Thai loan

IMF approves new Thai loan

WASHINGTON (Reuters): The International Monetary Fund (IMF) said on Wednesday it had completed a review of Thailand's economy, allowing payment of a new US$520 million tranche of an existing $17.2 billion international loan.

The IMF said it will contribute $135 million to the tranche. The tranche will bring to $14.1 billion, or more than 80 percent, the amount of the loan that has now been paid out.

The fund also said it was encouraged by "the continued financial stability and growing signs of recovery" in Thailand's economy, adding that both manufacturing production and consumption appeared to be on the mend after almost two years of recession.

"Improved confidence in financial markets, as reflected in lower interest rates, increasing equity values, and the return of capital inflows, augurs well for economic growth in 1999, which could exceed projected levels," it said.

Thailand has forecast 1 percent growth in output this year, according to a letter of intent signed with the IMF, after its economy contracted 8 percent in 1998.