IMF okays $270m loan for Thailand
IMF okays $270m loan for Thailand
WASHINGTON (Reuters): The International Monetary Fund approved
a payment of US$270 million from its $3.9 billion loan to
Thailand yesterday and praised it for pressing ahead with
economic reforms.
IMF Managing Director Michel Camdessus said in a statement
that the fund had approved the loan at a board meeting.
"Directors strongly commended the Thai authorities for
resolutely implementing the economic program in very difficult
circumstances and noted that this approach was increasingly being
reflected in improved market sentiment," he said.
The payment was the third installment of the IMF's loan to
Thailand, and it means Bangkok has received about $2.7 billion.
The loan forms part of a $17 billion international rescue
package which also includes money from the World Bank, the Asian
Development Bank and Asian states.
Camdessus said the IMF board had also approved changes to
earlier targets, allowing a Thai budget deficit of two percent of
gross domestic product and stepping up efforts to strengthen the
financial system. "Directors supported key modifications...aimed
at alleviating the impact of the sharp economic downturn and
strengthening the currency," he said.
Camdessus said Thailand appeared to have adequate funds to
keep the currency steady and maintain adequate foreign exchange
reserves. He added: "The IMF will continue to monitor the
situation closely to ensure that the program remains properly
funded at all times, including, if necessary, by the provision of
additional funding."
Analysts have said Thailand's economy is starting to recover
from a slump triggered by a currency collapse. They are much more
cautious about the situation in Indonesia, where reforms appear
to be stalling and the authorities dragging their heels on
implementing the reform package.
The payment was the third installment of the IMF's loan to
Thailand, and it means Bangkok has received about $2.7 billion.
The loan forms part of a $17 billion international rescue
package which also includes money from the World Bank, the Asian
Development Bank and Asian states.
Camdessus said the IMF board had also approved changes to
earlier targets, allowing a Thai budget deficit of two percent of
gross domestic product and stepping up efforts to strengthen the
financial system. "Directors supported key modifications...aimed
at alleviating the impact of the sharp economic downturn and
strengthening the currency," he said.
In Bangkok, Thai finance chiefs welcomed yesterday the release
of the latest tranche of international rescue funds and
Washington's promise to back more credit if required.
Bangkok also pledged to carry through reforms pledged in
exchange for its massive IMF-led bailout.
Finance Minister Tarrin Nimmanahaeminda said he was encouraged
by U.S. Treasury Secretary Robert Rubin's comment that Washington
would support extra credit for Thailand following the
International Monetary Fund's (IMF) approval Wednesday of the
next loan installment of $270 million.