Fernández de Kirchner: Argentina faces 'historic moment of extreme gravity'

Vice-President Cristina Fernández de Kirchner says Argentina is going through "a historic moment of extreme gravity" and that the debt agreement the country is seeking with the International Monetary Fund will define "the future development" of the nation.

In her first statements since the government's defeat in the November 14 midterm legislative elections, the former president criticised the 2015-2019 Mauricio Macri government for signing the record US$57-billion loan deal with the IMF that resulted in a debt of "the handsome sum of US$44.5 billion" for Argentina.

Fernández de Kirchner did, however, acknowledge the opposition's victory in last month's election, before criticising their "political irresponsibility" for returning Argentina to indebtedness with the multilateral lender.

"Is it really true that the same people who brought the IMF back to Argentina, restarting the tragic cycle of indebtedness that [former president] Néstor Kirchner had closed in 2005, are today not responsible for anything?" she asked.

President Alberto Fernández's government is negotiating a new agreement to delay and restructure payments on the record credit-line granted in 2018. Upon taking office in December 2019, the Peronist leader rejected the remaining tranches of the loan. Under the terms of the present deal, the country must make repayments of US$19 billion in both 2022 and 2023.

"Argentina, like the rest of the world, was and continues to be affected by the pandemic and the risks of a permanent mutation and return [of the virus]. Our country also has the unprecedented burden of an unprecedented debt with the IMF," Fernández de Kirchner argued in a letter published on her personal website last weekend.

"It is a historic moment of extreme gravity and the definition that is adopted and approved could become the most authentic and real obstacle in living memory to the development and growth with social inclusion of our country," she added.

"And watch out! And no-one is talking about not recognising debts," the vice-president said, dismissing rumours that Argentina would not pay.

Without an agreement with the IMF that would allow it to defer payments and restructure its debt, Argentina – which has already restructured its liabilities with private bondholders but is going through a context of currency shortages and high inflation of more than 50 percent a year – could risk a new default.

Fernández de Kirchner also insisted that decisions on a deal rest with the president, and that it must be endorsed by Congress, based on a law passed in 2020.

"The totality of the political forces (...) assumed the responsibility of deciding whether or not to approve what the executive branch negotiates and agrees with the IMF," she recalled.

"It is the 257 deputies and 72 senators who have the legal, political and historical responsibility to approve or not how the largest debt with the IMF in the world and in all of history will be paid and under what conditions," said the former president.

Speaking after the publication of the letter, opposition leader Patricia Bullrich said she was "happy" to have read it, given that the former president "recognised the enormous triumph" by Juntos por el Cambio in the midterms.

" I am very happy with the letter from Cristina Fernández de Kirchner. For the first time, she recognised the enormous federal victory of Juntos during the legislative elections that took place weeks ago."

– TIMES/AFP