In May, officials from the South American country notified the IMF that they would be exiting a two-year flexible credit line agreement they had in place since 2020.
At that time, Chile accepted an agreement to subscribe a Short-Term Liquidity Line (SLL) for 3,300 million dollars, which is now without effect.
IMF credits
The line of flexible credit “it’s character precautionary Y temporary. It is granted to countries that have very solid macroeconomic fundamentals and policy frameworks that account for the resilience of the economy and the capacity to respond to external shocks,” the Chilean central bank said in a note.
“The subscription of the LCF not subject to conditionalities of any kind by the IMF and can be accessed as long as the country meets the demanding qualification criteria,” he added.
The head of the IMF mission in Chile, Ana Corbacho, told reporters in a call that there were no time limits or restrictions on this line, and that the full amount would be available in an economic shock scenario.
The measure corresponds to an insurance or second line of protection against large-scale adverse scenarios such as an abrupt deterioration in global financial conditions or the terms of trade, as well as a more complex global activity scenario.
Source: Ambito
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