Between idiots and scarce reserves, the government pays 2,700 million dollars to the IMF

The government will pay between this Tuesday and Wednesday maturities of US $ 2,684 million to the IMF before the arrival of the second shift of the organism. Payment will be made with the resources available at the Central Bankbetween the delays in obtaining final approval on the first audit and the negotiations to change the objectives in the second quarter in the face of increasing difficulties in meeting the program.

The original idea was that the amount corresponding to the Standy by loan, contracted in 2018 during Mauricio Macri’s administration, would be canceled with the second disbursement, of 4,005 million dollars, as part of the first revision of the objectives scheduled for 10 June. This agreement with the staff had been reached two days earlier, but the board of directors of the The body will only decide if it approves it next Fridayaccording to sources from the Ministry of Economy.

“Payments correspond to the Stand by 2018 and are on Tuesday 21st and Wednesday 22nd for a total of 2.014 million SDRs (US $ 2.684 million). Then, with the approval of the board of directors, SDR 3,000 million (US $ 4,005 million) enters. according to the calendar of the Extended Facilities Agreement (EFF) of 2022 “, confirmed in official dispatches aware of the negotiations with the Fund.

The gap between the expiry date and the arrival of new funds will be bridged with the disbursement on 25 March, when Argentina received $ 9.7 billion in SDRs. After the March, April and May payments to the agency, economists estimate a residual of $ 6,000 million to meet paymentsbut they warn that it is not normal to cancel them before the funds entered into by the agency.

The new calendar would be tied to the jerks to recalibrate the schedule due to the external shock. Due to accelerated spending and loss of reserves due to record energy imports, The government called for easing the fiscal deficit and the accumulation of foreign currency between April and June, without touching the annual guidelines. In exchange, He promised to raise rates again, accelerate the dollar adjustment and “redirect” spending, among other points.

After taking steps last week, Economy hopes the council is led Kristalina Georgieva approves the proposed changes and the second disbursement next Friday. If this happens, Martín Guzmán will not need a waiver to comply with the schedule. “There should be a review of the quarterly objectives, We have an agreement with the staff and that is for the examination of the board on June 24th “, they explained to the Treasury.

Some of the adjustments have been reflected in the review of the financial statements. The government had promised to introduce it in April, but after its unsuccessful passage in Congress and internal pressure to expand spending, it ended up approving it last week. The decree provides for a reduction in energy subsidies of 0.05% of GDP -much lower than expected- ea inflation up to 62%, below market expectations of 72%.

Guzmán also ratified the reduction of the primary deficit to 2.5% of GDP, the reduction of monetary issuance to 1% and the accumulation of 5,800 million US dollars in 2022. This implies that, if the budgetary targets and in the second quarter, the fiscal red cut (with more taxes or less expenses) and the devaluation rate in the next six months will need to be accelerated, the worst time of the year to be that of the highest disbursements and the lowest dollar harvest revenue .

YN