Today the mission sent to the country by the International Monetary Fund ends its task. With meetings starting on Friday, the outcome of the talks is expected to be officially announced this Wednesday. Formally, as Clarín was informed at the Casa Rosada, at some point in the day, perhaps after noon, There will be two declarations: the first one released by the IMF and then the one corresponding to the Argentine Government.
It is easy to risk that we will talk about very constructive meetings, about the support that the Fund will give to Javier Milei’s government to manage the difficult moment and that if there is an agreement, it will be to support a program designed by the Argentine government.
It is a formula already used in the latest agreements (those signed by the officials of former presidents Mauricio Macri and Alberto Fernánadez) and it is the way that the Fund has found to not appear as the body that imposes economic policies on governments, even if in reality This is the case, regardless of whether governments comply with these guidelines or not. In fact, and not to exaggerate, Sergio Massa, as Minister of Economy and presidential candidate, He started violating the latest agreement as soon as he signed it.
But the concrete thing is that on Tuesday the meetings returned to the technical level, after the meeting that the Chief of Staff Nicolás Posse and the Minister of Economy Luis Caputo had on Monday with the IMF envoys, the head of the mission for ‘Argentina Ashvin Ahuja, the representative of the IMF in Argentina Ben Kelmanson, Luis Cubeddu and two other officials, in addition to the delegation of the international organization.
On a technical levelOn the Argentine side, officials of the Central Bank led by Santiago Bausili and the Treasury Minister Carlos Guberman participated, as well as the two main advisors of Minister Caputo, Federico Furiase and Martín Vauthier. Given that the issue of energy subsidies is a central point of the adjustment plan that the Government promises to implement, the Minister of Energy, Luis Chirillo, also participated and raised the issue of subsidies in the public hearing on gas tariffs on Monday natural and this Tuesday he explained to the Chamber of Deputies what corresponds to the Omnibus law.
The most urgent thing for the Government is for the IMF to authorize new disbursements for 3.4 billion dollars recover the reserves after the payment of the maturities, including the 1,600 paid on Tuesday to private creditors.
The government is in a hurry to release funds suspended since November for failing to meet the targets signed in March 2022. With negative reserves of almost $9 billion, the authorities need dollars to meet deadlines with the agency for $1,950 million dollars in January and $674 million in February.
The government is confident that the Fund will find no reason to refuse. President Javier Milei himself said that his administration is facing him a larger fiscal adjustment than that requested by the IMF.
It is true. As well as the doubts that IMF officials expressed about the ability of the Milei government to implement not only the proposed adjustment but also the economic reforms, including the new pension adjustment formula.
The IMF technicians also carefully observed the Central Bank’s numbers, the situation of monetary liabilities, the exchange rate strategy of devaluing by only 2% per month and the possibility of purchasing foreign currency, facing a complex negotiation with importers, who they have not yet allowed themselves to be tempted by the bonus intended to pay off a debt that they can reach 62 billion dollars. Lots of unknowns, as you can see.
Source: Clarin
