Because interest payments to the Monetary Fund increase

The interest account at the IMF has grown. “The increase in international rates has had a direct impact on the interest rate of the Special Drawing Rights (SDRs, the currency used by the agency in its transactions),” says the Congressional Budget Office.

Argentina pays quarterly interest to the IMF on the first day of February, May, August and November of each year, on a debt balance that is currently equivalent to $ 43.308 million. In November, interest amounts to over $ 500 million.

Therefore, after paying $ 306 million in interest in August 2020, this month the payment was $ 454 millionalso affecting the new disbursements that the agency is making for the payment of the capital maturities.

The SDR rate has risen to the current level of 146 points (1.46%), which implies an increase of 138 points compared to that in force at the beginning of the year. The report adds that “if the SDR rate is maintained at its current level, Argentina’s interest payments to the IMF would amount to $ 1,670 million in 2022, $ 2,122 million in 2023 and $ 2,042 million in 2024”.

An IMF loan has a base rate of 1.5%. then load a “supplement” which depends on the amount and deadline for repayment of the credit. This is 200 basis points (2%) on the residual credit amount that exceeds 187.5% of the debtor country’s share in the Fund. And if the credit remains above 187.5% of the quota after three years, this supplement rises to 300 basis points (3%).

Currently, Argentina’s debt is equivalent to over 1,000% of the share.

“Between 2020 and most of 2021, the SDR interest rate hovered around its minimum level. At the end of 2021, the monetary authorities of developed countries began to raise their key interest rates, with the aim of contain inflationary pressures”States the OPC Report.

With the transfer of $ 454 million earlier this month for the extraordinary loan granted in 2018, Argentina has already paid the IMF interest of $ 5,223 million.

Of that total, $ 1.381 million was paid during Mauricio Macri’s reign and $ 3,842 million from the current governmentaccording to the OPC data.

Of the US $ 5,223 million paid, approximately US $ 1,632 million corresponds to the general interest rate that the IMF charges for these loans. And another $ 3,591 million was paid for expenses and surcharges.

Therefore, $ 2 out of $ 3 in interest corresponds to expenses and surcharges.

NEITHER