President-elect Chaves wants "to get better" Costa Rica agreement with IMF

The president-elect of Costa Rica, the right-wing Rodrigo Chaves, considered on Monday “indispensable” the agreement that his country signed with the IMF for 1,778 million dollars, but he hopes to “improve” the goals, with more efficient economic growth plans.

“The IMF is not a source of resources to meet the government’s financing needs. We think of it as an instrument to give confidence to the people who have to lend us money, that Costa Rica will be able to honor its debts,” he explained.

“That the Fund give us recognition for more ambitious public policy measures regarding economic reactivation and fiscal responsibility,” which would allow access to financing from other organizations, he exemplified.

“We are not going to loosen our commitment to responsible and healthy public finances,” he said.

At the close of March, the IMF reactivated a credit program agreed a year ago with Costa Rica, by approving a second disbursement of 284 million dollars and giving it more time to apply the agreed reforms.

The new tranche delivered is part of the 1,778 million dollars agreed on March 1, 2021 for 36 months under the modality of extended facilities (SAF), after Costa Rica’s commitment to make adjustments to reduce the deficit of its public finances.

Costa Rica closed 2021 with a fiscal deficit of 5.18% of the Gross Domestic Product (GDP), lower than the 8.03% registered in 2020. The public debt, of more than 42,436 million dollars, exceeded 70% of the GDP.

Periodic disbursements from the IMF, “for purposes of the national budget (…) are not going to fix our problem, they are a drop of water in a fire,” said Chaves, an economist who worked for three decades at the World Bank.

One of the requirements for the disbursement of the IMF was the approval of a public employment law, which readjusts pensions and equalizes salaries, in order to cut spending. Chaves said that he hopes “to have the possibility of changing it”, either with a reform or a regulation.


Chaves prevailed on Sunday in a ballot against the centrist José María Figueres, and will govern for four years, starting on May 8, this Central American nation affected by a severe economic crisis.

His detractors remind him of sanctions for sexual harassment of two subordinates, events that occurred between 2008 and 2013, when he was a World Bank official. Chaves assures that they were “jokes” that were misunderstood due to “cultural differences.”

“The truth surprises me. To get so many votes, many women had to vote and I am surprised that we do not want to move forward because for me he is a macho man. The country does not want to move forward,” said Ana Paula Rodríguez, 18, on a street in the downtown San Jose.

This Monday, Chaves said that he will not refer to the issue again and ruled out that the matter affects the image of the country. “I guarantee that economically this does not mean any damage to Costa Rica,” he said.

For his voters, his experience as an economist for an international organization will allow the country to get out of the economic crisis.

I am “happy with the result, happy with the change and we hope that this new government starts off on the right foot and that it can meet the expectations of the people,” said Javier Jiménez, 63, a resident of the capital.

-Relations with Nicaragua-

Chaves said he was willing to resume relations with Managua at the ambassadorial level, a link suspended because the current government of Costa Rica did not recognize the November elections in Nicaragua, where Daniel Ortega was elected for a fourth consecutive term.

Ortega, a former guerrilla in power since 2007, won his re-election with most of his rivals and opponents in prison, accused of plotting to overthrow the government with the support of Washington.

“My inclination is to appoint an ambassador to Nicaragua. If we have diplomatic relations, we are not at war,” he assured. “Who said that talking is making a moral endorsement? We have to maintain diplomatic relations with all our neighbors,” she said.

Shortly after, he considered that he will see these issues with his future chancellor.

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