With Chief of Staff Nicolas Posse in Washington, The Executive Board of the International Monetary Fund will meet on Wednesday analyze whether the latest review of the Argentine program will give the green light, which will support for President Javier Milei’s adjustment plan and will allow an outlay of approximately 4.7 billion dollars.
The council, composed of executive directors representing member countrieswill have in their hands the agreement on the technical plan signed on January 10, which relaunches the program derailed last year with the “Platita Plan” of Sergio Massawhose the objectives were not achieved.
The directors will ask specific questions to the technicians who produced the report, guided by Luis Cubedduand the Argentine representative to the IMF, Leonardo Madcur, could clarify some doubts if necessary. The revision, which includes new fiscal and reserve targets, is estimated to It will pass without a hitch, although it may have some surprises in store.
According to the agency Reuters, the directory may allow Argentina postpone the last review this year scheduled for September to allow Milei management to have a greater margin implement economic reforms and potentially negotiate a new program.
Why did Nicolas Posse go to Washington?
The Chief of Staff, Nicolás Posse, arrived in the capital on Tuesday and met with the number two of the Fund, Gita Gopinath. There is no official information on the content of the meeting, but it is estimated that the Argentine official presented Gopinath with the details of the discussion on the DNU and the omnibus law which is being discussed this Wednesday in the hall of Congress. Above all, how do they plan to rearrange the numbers in recent months, when the fiscal part of the law, which allows for a large part of the adjustment, has been postponed because the opposition has not endorsed it.
Posse’s visit also included a meeting at Treasury with Under Secretary for International Affairs Jay Shambaugh, who briefed on political negotiations on the plan. The United States is a key player on the Fund’s executive board Because being the world’s leading power, it is the main partner with the greatest voting power. Joe Biden’s government has already shown that it agrees with Milei’s new measures and will support Argentina.
The program includes a fiscal adjustment with the removal of subsidies, tariff increases, privatization of public companies, reduction of expenses, cutting of transfers to the provinces, labor flexibility and many other measures to achieve the new objective of 2% primary surplus agreed with the Agency, a package that will require a lot of effort by the Argentines with an economy that will cool as the Fund now predicts. Also includes a new booking target: These policies are expected to lead to an accumulation of $10 billion in net reserves by the end of 2024.
Minister Luis Caputo insists on the objectives they will be reached anywaydespite the government’s misstep with the law.
The Fund likes these measures, but tries to ensure that they are expressed by consensus. “The plan focuses on creating a solid and credible fiscal anchor, together with measures to replenish reserves, correct relative price imbalances, strengthen the Central Bank’s balance sheet and create a simpler, rules-based and money-oriented economy. market”, we read in the Fund. She said.
Posse will continue his agenda in Washington this Wednesday with an eye on what happens at the Fund. The Chief of Staff will focus his day on Central Intelligence Agency (CIA). Accompanied by the head of the Federal Intelligence Agency (AI) Silvestre Sívori, he will meet with the director of the agency, William J. Burns, “to strengthen bilateral relations on the matter and reposition our agency in the world,” they said. it’s a statement.
Source: Clarin
