Bogotá, Colombia
April 13, 2005
Mr. Rodrigo de Rato
Managing Director
International Monetary Fund
Washington, D.C. 20431
Dear Mr. de Rato:
The government remains fully committed to promoting faster sustainable and equitable
economic growth through the implementation of a strong economic program in 2005 and
2006, which is explained in the attached Memorandum of Economic Policies and Technical
Memorandum of Understanding.
We are requesting the Fund's support for this program through a new 18-month Stand-By
Arrangement (SBA) in the amount of SDR 405 million (35 percent of quota on an annual
basis), with these resources to become available on a quarterly basis. The government will
treat the new arrangement as precautionary. We would also like to cancel the SBA that
expires on May 14, 2005 simultaneously with the approval of the new program.
We are also requesting completion of the final review under the current Stand-By
Arrangement. All quantitative performance criteria at end-2004 have been observed and most
structural benchmarks have been met (Tables 1 and 2). In this regard, we are requesting a
waiver of the condition for the completion of the fourth review calling for congressional
approval of the revised budget code. We will strive to have this legislation approved by
Congress by June 2005, which will be a structural performance criterion under the new
arrangement. We are also requesting a waiver for the nonobservance of the performance
criterion on the nonintroduction of a multiple currency practice, which was created by the
subsidies for banana and flower exports introduced in December 2004. The deadline for
applying for these subsidies was February 28, 2005. Now no one is eligible for these
subsidies.
Sincerely yours,
___________________________ __________________________
Alberto Carrasquilla Gerardo Hernandez
Minister of Finance Acting General Manager
and Public Credit Banco de la República