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FINANCIAL NEWS
IMF extends $370m loan to Yemen
04 Aug 2010
(MENAFN) Deputy managing director of the International Monetary Fund (IMF), said that the lender has approved a $370 million loan for Yemen to support a three-year plan targeted at slashing the budget deficit and reducing poverty, Bloomberg reported.
The director said that the IMF has made an initial disbursement of $53 million available immediately.
Yemen’s government aims to rein in the fiscal deficit to 3.5 percent of gross domestic product while generating annual economic growth of 5 percent, the IMF said. The government is set to introduce a general sales tax and eradicate exemptions on tax and customs duties to boost revenue. Tax evasion in Yemen is estimated at 80 percent, according to the Yemen Times newspaper.
Growth may accelerate to 8 percent this year from 3.9 percent last year, with non-oil output increasing 4.4 percent, according to IMF forecasts. The inflation rate may rise to 9.8 percent, the IMF said.
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