B.Choijilsuren: Prerequisite to implement IMF's Extended Fund Facility program has been satisfiedEconomy
Ulaanbaatar /MONTSAME/ The first financing of the International Monetary Fund's Extended Fund Facility program will be provided in the middle of June, said Finance Minister in his interview to itoim.mn news website. “- In the night of April 13, when the budget amendments were approved by the Parliament, Governor of the Bank of Mongolia N.Bayartsaikhan and me, as a Finance Minister sent an official letter to the IMF, informing that prerequisite to implement the EFF program has been satisfied.
After the approval of the program by the IMF's Board of Directors' on April 28, separate talks will be held with each organization that provides package funding. Currently, talks with the World Bank to get a soft loan of USD600 million are underway. This program is predicted to start in mid-June. We reached an initial agreement with Asian Development Bank to get loan of USD900 million. The ADB spring meeting will be held on May 5-8, in which I will be attending. The EFF program approval should be completed around this time. With IMF, talks will be on loan of USD440 million and an IMF financial surveillance team is coming to Mongolia in the middle of May. So, the first financing will be provided mid-June” Minister B.Choijilsuren said.
The Finance Minister also noted that financial support of USD440 million from the IMF will be spent on increasing the currency reserve of the Bank of Mongolia, while some parts of loans from the World Bank, Asian Development Bank as well as from Japan and the Republic of Korea will be allotted to recover budget deficit. It is estimated that a total of USD1.9 billion will be spent for recovering budget deficits in 2017, 2018 and 2019. The rest of the loans will be devoted to implementing programs and projects.
According to the Minister, funding within the EFF program will not be spent for repayment of previous loans and bonds. “- First big loan repayment was Euro Bond of USD580 million, which has been resolved. The next, repayment of Chinggis bond of USD500 million should be made on January 05, 2018. Moreover, repayment of Dim Fund bond of CNY1 billion or USD160 million should be made in the middle of May. We are working on replacing these bond repayments with new short term bonds with low interest rate. We have 2-3 more different versions and we have not chosen the final option yet, as we have time”.