Nepal Secures $42.9 Million from IMF After Completing Extended Credit Facility
The International Monetary Fund (IMF) Executive Board has successfully completed the final review of Nepal’s Extended Credit Facility (ECF) programme. This crucial milestone clears the immediate disbursement of approximately $42.9 million in financial assistance, bringing Nepal’s total access under the 38-month programme to about $384.1 million. Originally approved in January 2022, the financial arrangement is set to conclude on July 11, 2026.
In an official statement, the IMF commended Nepal for making significant progress in executing vital economic and structural reforms. Despite facing headwinds from sluggish domestic economic activity, the Nepalese government successfully implemented key upgrades. These achievements span critical areas including monetary operations, enhanced financial sector supervision, comprehensive loan portfolio reviews, fiscal transparency, and strengthened anti-money laundering frameworks.
However, external and domestic challenges continue to weigh on the nation’s immediate economic outlook. The IMF has projected Nepal’s economic growth at 3 percent for the 2025/26 fiscal year. This moderated growth forecast is attributed to recent disruptions from political protests, lower agricultural output, subdued private investment, and the cascading global impacts of the ongoing conflict in the Middle East.
Moving forward, the capital injection aims to help Nepal sustain the core commitments made under the facility. By anchoring macroeconomic stability, strengthening foreign exchange reserves, and improving public financial management, the funds will support Nepal’s transition toward a more resilient economy as the ECF programme draws to a close next month.
