The Central American Bank for Economic Integration renews credit line to Nicaragua for $200 million

The Central Bank of Nicaragua (BCN) reported that it had renewed a credit line for up to $200 million with the Central American Bank for Economic Integration (CABEI). The credit line is to support the country’s liquidity management.

The contract was signed on Wednesday, November 15, 2023, and its objective is to “support the liquidity management of the BCN,” while the country’s external debt increases.

The renewal of the credit line is consistent with the BCN’s objective of strengthening the financial safety network, safeguarding financial stability, and contributing to the credibility of the exchange rate regime, a fundamental pillar for Nicaragua’s macroeconomic stability. Central Bank of Nicaragua BCN.

This marks the fourteenth extension of the credit line provided by CABEI to Nicaragua. The credit line operates on a revolving basis and remains effective for one year since August 2021. The initial signing of this loan by the Central Bank occurred on August 21, 2009.

According to the Central Bank, this disbursement is part of a renewal of a line of credit granted under the program called Credit to Support the Liquidity Management of the Central Banks of the Founding Countries of CABEI.

The Central Bank reports that Nicaragua anticipates a 3.5% to 4.5% economic growth of its gross domestic product (GDP) for 2023. This marks a third consecutive year of positive economic growth for Nicaragua, following three years of concluding with a deficit.

The BCN appreciates the financial support from CABEI that will contribute to the stability and promotion of the economic development of Nicaragua. Central Bank of Nicaragua BCN.

The credit line renewal comes a few days after Gisela Sanchez was elected as the new president of the Central American Bank for Economic Integration (CABEI).

According to the Economic Commission for Latin America & the Caribbean (ECLAC), a 3.3% economic growth is expected for Central America in 2023. Nicaragua and El Salvador are expected to grow less in Central America.