The International Monetary Fund said Thursday that they exist “good progress” on the path to reducing inflation in Argentina and asked that the burden of the adjustment “does not fall disproportionately on poor and working families”, that “the real value of pensions” be preserved and that further aid be allocated to the sectors more vulnerable vulnerable.
At a press conference in Washington, communications director Julie Kozack answered some questions about the program with our country, the latest revision of which was approved in January.
“An ambitious stabilization plan is being implemented to correct serious policy delays in the final quarters of 2023,” Kozack said. “To get the program back on track, the plan focuses on creating a strong fiscal anchor, coupled with policies to sustainably reduce inflation, rebuild reserves and address long-standing distortions and impediments to growth,” he added .
“Good progress is being made, but obviously the path to stabilization will be difficult and this requires strong policy implementation, agile policymaking and agile policy formulation. Efforts to support the most vulnerable segments of the population constitute a fundamental pillar of the program. And it is important that the burden of the adjustment does not fall disproportionately on poor and working families,” she said.
“This involves addressing the challenges of inflation and high poverty,” the official added. “Strong fiscal consolidation, the elimination of monetary financing, together with improvements in the monetary policy framework and the exchange rate are expected to result in a gradual process of disinflation”
“We are seeing some results in this area with inflation starting to decline. And why is it so important to reduce inflation? It’s about protecting the most vulnerable, because we all know that inflation is a tax on the poor. Given the delicate social situation, combined with the already very high poverty rate in Argentina, it will be important to guarantee further social assistance and preserve the real value of pensions.”
“Constant efforts are also needed to support vulnerable segments of the population. It is very important for us that, under the program, the burden of adjustment does not fall on working families. And the most vulnerable segments of the population,” she added.
As for the possibility of a new program with the Fund, which involves the disbursement of fresh money, something that Minister Caputo had hinted at after the meeting with the authorities of the International Monetary Fund in Brazil, Kozack did not provide too many details .
“Right now, our focus remains on support policies. “We aim to restore macroeconomic stability in Argentina by protecting the most vulnerable,” she said. And he added: “It is premature to discuss the exact and precise modalities of the program.”
He was also asked about a tweet from former minister Martín Guzmán, who reported having met in Argentina with a mission from the Independent Fund Evaluation Office, which arrived in our country to “verify whether the exceptional access criteria” were respected . They had respected the loan granted in 2018.
Kozack noted that “the Office of Independent Evaluation conducts objective and independent assessments on issues relevant to the mandate of the International Monetary Fund. The IEO’s current work program includes an evaluation of the International Monetary Fund’s exceptional access policy. The evaluation specifically examines the application of the policy in previous exceptional access programmes. The 2018 stand-by agreement with Argentina is one such program, but not the only one that will be examined as part of this review. I would therefore like to clarify that this refers to the exceptional access policy itself.”
Source: Clarin
