Colombia
CONFIDENTIAL
XV
47 The trade surplus is likely to narrow this year (disease has affected coffee
exports and oil exports have been disrupted by guerrila activity; imports have been
boosted by stronger domestic demand and liberalisation). Inflation at 28% in the
12 months to November is above Fund projections.
48 A (first) rescheduling is now a distinct possibility. The $1.85 bn in new
credits requested from banks has progressed only slowly ($1.4 bn has been offered in
conventional new money, while about $200 mn may be provided in a range of
market-based options).
Ecuador
49 The weakness of oil prices is particularly unwelcome at a time when August's
emergency measures were beginning to show some effect. Inflation has slowed and
the new government, despite hawkish statements during the election, appears to be
intent on regularising relations with creditors and so releasing new IFI credits.
Steps have been taken to settle arrears due to the IADB. A new SBA is under
Formal discussions with the banks began in November and included a
request for $1 bn to cover interest arrears.
discussion.
Uruguay
50 The trade balance continues to improve despite weak regional demand reflecting
sluggish domestic growth and a competitive exchange rate. Inflation, however,
remains stubbornly high. At the end of November the authorities introduced some
measures, including a freeze on investment spending, intended to reduce the fiscal
deficit in 1989.
Bolivia
51 In October a scheduled meeting between the Bolivian authorities and Advisory
Committee to discuss the future of the remaining bank debt was cancelled. No
further meeting has yet been arranged. A request for a concessional rescheduling
was rejected by creditors at November's Paris Club. Instead, the agreement reached
rescheduled $230 mn principal and interest and arrears over 10 years/6 grace.
Although the trade deficit has narrowed and reserves have risen, inflation, at
17.7%, is above target and some ESAF performance criteria could be missed.