Tashkent, Uzbekistan (UzDaily.com) -- The Executive Board of the International Monetary Fund (IMF) today approved a three-year SDR 66.6 million (about US$106 million) arrangement under the Extended Credit Facility for the Kyrgyz Republic to support the economic recovery in the short term and place the country on the road to stronger sustained and inclusive growth in the medium term. The Board’s approval enables the immediate disbursement of SDR 9.514 million (about US$15.2 million).

The Kyrgyz Republic suffered from a deep political crisis in 2010. The fallout from the domestic crisis has posed significant challenges. The economy contracted last year, straining the government’s financial position, further exacerbated by critical reconciliation, recovery and reconstruction needs. The banking sector also suffered from diminished depositor confidence and the economic effects from the events in the south. Moreover, the global food and fuel price shock triggered a sharp rise in inflation, eroding real incomes of the most vulnerable part of the population.

The new Fund-supported program will provide a coherent macroeconomic framework that will support the authorities’ efforts to sustain economic recovery, promote inclusive growth in a low inflation environment, restore macroeconomic stability, achieve medium-term fiscal consolidation, address weaknesses in the financial sector, improve the country’s governance, and catalyze critical donor support.