While the Government awaits the arrival of an outlay of 4.7 billion dollars to cover the maturities that fall at the end of the month, the International Monetary Fund He has not yet confirmed when he will meet The Washington committee to authorize the change agreed almost two weeks ago with Argentine authorities during the visit of an organization mission to Buenos Aires.
Support is key in the roadmap of the Minister of Economy, Luis Caputo: He has that money to pay the $1,950 million postponed to January 31 and the April payments with the organization. “I understand that they manage to make ends meet“, they noted in Economía, even if the resources cannot be used to cover the interest of 830 million dollars that expire on February 1.
11 days ago, Caputo, the dropped program was resumed and reached a technical agreement with the IMF, with which it undertakes to achieve a primary surplus of 2% of GDP and to purchase 10,000 million dollars of reserves in 2024. In exchange for the advancement of the adjustment plan, “the Argentina would have access to nearly $4.7 billion, subject to board approval,” the Fund reported.
The dollars correspond in part to the disbursement pending in November after the failure to achieve the objectives in the management of Alberto Fernández and the Minister of Economy, Sergio Massa, and the rest is an addition. Caputo recognized this It wasn’t “new silver”but that would be used to pay the $900 million CAF loan in December and the principal expires until April.
During the forum in Davos, Switzerland, the Fund’s director, Kristalina Georgieva, highlighted last week the “good meeting” she had with Javier Milei in their first face-to-face meeting and revealed that they spoke about the “profound economic impact and social challenges and decisive measures to reduce inflation”, but without giving any signal regarding the convening of the board of directors to approve the seventh revision.
Delays in confirming the Washington meeting coincide with the challenges faced by the Government to control inflation which has reached 211% per year, with the renewed currency pressures which have brought the gap to 60% and with the difficulties in approving the reform package contained in the DNU and in the law omnibus, on the eve of the first general strike called by the CGT for this Wednesday.
Although Milei recently stressed that the agreement with the Fund was “the fastest negotiation in history” and that its adjustment plan is “much deeper than what the International Monetary Fund requested”, the organization remains awaiting the progress of Congress. The importance of this issue became evident in Davos, where Caputo received dozens of questions about “economic reforms.”
The legislative package is strategic for the government. In its 664 articles, the first official project sent to Congress contains measures to reduce the deficit and respect the Fund, such as the privatization of companies, the suspension of the pension formula and the increase in withholdings, three points that are now the subject of strong tug of war in negotiations with allies and the opposition.
From the organization they have already made it clear that they expect the government to generate the “political support” to pass the law due to its tax implications. Other measures, such as cutting spending on subsidies, public works, social plans and transfers to the provinces, do not depend on Congress. But Caputo warned that, if the law does not pass, adjustment will be more difficult.
Source: Clarin
