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Portugal makes early €1bn repayment to IMF

AFP | Lisbon |

Portugal has made an early repayment of  €1 billion to the International Monetary Fund and intends to repay a further €2.6 billion of bailout loans by August, the government said.

As part of a bailout in 2011, Portugal was loaned €29.6 billion by the IMF, more than half of which has already been repaid.

But Lisbon aims to reduce interest on borrowings with further early payments.

The IMF interest currently stand at 4.6 per cent, compared to available market rates of 3.0 per cent over 10 years.

"The early repayment to the IMF is significant in improving the viability of debt by reducing its cost," the finance ministry said in a statement.

Once the next €2.6 billion sum is repaid, €10.4 billion of debt will remain to be repaid, according to the government.