Instead of two, Portugal will repay another three billion to IMF this year

  • ECO News
  • 8 November 2017

The 2018SB stated Portugal would repay another three billion euros to IMF this year. A one billion reimbursement was made, so the country had two more to go. Now, however, that amount increases again.

Portugal will still make an early reimbursement of almost three billion euros to the International Monetary Fund (IMF) by the end of the year. This amount represents an upward revision of around one billion euros in comparison to what was foreseen in the State Budget draft, showing the Government’s wish to accelerate the payment of debt which has a high cost in comparison to the current market rates.

"We will, very soon, make another early repayment to IMF, of around three billion euros.”

Mário Centeno

Finance minister

In the 2018 State Budget draft, the Government foresaw paying another three billion euros in the last months of the year. Since then, it reimbursed one billion euros, revealing that it would make an additional two billion euros’ payment to the entity headed by Christine Lagarde. However, the amount was once again revised upwards: the Executive points to an amount of around three billion euros.

“We will, very soon, make another early repayment to IMF, of around three billion euros”, which enables a “reduction in the average cost of indebtedness, maintaining the average debt maturity and reinforcing very good financing conditions in the Portuguese economy“, stated Mário Centeno in Brussels, quoted by Lusa. To ECO, the Finance Ministry confirmed the upward revision of around one billion euros, adding the exact amount is not yet defined.

In 2017, Portugal already repaid more than six billion euros to IMF, around 66% of the 26.3 billion Portugal borrowed in 2011. But the goal is to increase the amount to nine billion euros until the end of the year, in a strategy that will allow the Government to take advantage of the good environment in the market to replace IMF’s most expensive loan for new debt.

PUB