El Salvador reaches IMF agreement to unlock $140 million

The International Monetary Fund (IMF) has reached a staff-level agreement with El Salvador regarding the combined second and third reviews of its 40-month Extended Fund Facility. This agreement, pending Executive Board approval, could unlock approximately $140 million in disbursements.

Economic indicators for El Salvador show stronger-than-expected performance, with real GDP growth projected to reach 4.5% in 2026. This growth is attributed to robust private consumption, investment, tourism, and remittances, alongside improved national security. The IMF noted that fiscal and external imbalances are being reduced in line with program commitments.

A key component of the agreement addresses El Salvador’s Bitcoin holdings. The IMF stated that verified documents show no public funds were used for recent Bitcoin accumulations, which were instead sourced from private donations. Additionally, operational control of the government-backed Chivo digital wallet has been transferred to a private operator, with the government retaining only a minority stake. The IMF indicated that no further public-sector Bitcoin accumulation is expected under the current framework.