KATHMANDU, Dec 9: The International Monetary Fund (IMF) has extended the timeline of its Extended Credit Facility (ECF) for Nepal by an additional four months.
The international watchdog in a press release has stated that the Executive Board of the IMF approved the Nepali authorities’ request for a four-month extension of the ECF until May 11, 2026, to allow sufficient time for completing the seventh review of the ECF. The 38-month ECF arrangement was approved by the Executive Board on January 12, 2022, with access to Special Drawing Rights (SDR) of 282.42 million (180 percent of quota).
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During the impact of the COVID-19 pandemic, the IMF announced the 38-month financing package targeting to help Nepal mitigate the impact of the pandemic on health and economic activity and protect vulnerable groups. The package was also aimed to preserve macroeconomic and financial stability and support a reform agenda that leads to sustained growth and poverty reduction.
Key policy actions under the program include measures to boost revenue and public spending efficiency, strengthen financial sector regulation and supervision and support fiscal transparency, as well as to enhance governance and combat corruption. Under the same program, Nepal Rastra Bank has been carrying out the external audit of 10 large commercial banks operating in the country.
On May 1, 2023, the IMF approved an extension of the ECF to January 11, 2026 with rephasing of disbursements. Nepal is yet to receive the final installment of the approved amount.
