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ECONOMY | 02-03-2022 23:46

Argentina’s draft IMF agreement heads to Congress

Sources close to Lower House Speaker Sergio Massa confirm to local media outlets that a bill outlining Argentina’s agreement with the International Monetary Fund will be sent to Congress this Thursday.

Argentina’s government will send a bill outlining its new agreement with the International Monetary Fund (IMF) to Congress on Thursday morning, according to reports.

The news was confirmed on Wednesday by multiple local outlets citing sources close to Lower House Speaker Sergio Massa. The bill contains details of the financing programme drawn up with staff from the multilateral lender to replace its existing deal, which was drawn up in 2018.

The proposed law, under which Argentina will restructure its existing 2018 financing programme and a debt of US$44.5 billion, will be sent to the Chamber of Deputies, which will subsequently define the bill’s treatment at committee stage, debate and eventual vote.

"In order to arrange treatment, the committee schedule, guests and speakers, as well as attendance of officials, tomorrow at 12 noon there will be a meeting” of caucus leaders, the authorities of the Budget Committee and the authorities of the lower house, said one source quoted by Perfil.

Economy Minister Martín Guzmán, Cabinet Chief Juan Manzur and Argentina’s representative to the IMF, Sergio Chodos, are all preparing to appear in the Chamber of Deputies to defend the bill, which is a top priority for the Casa Rosada.

Once the text of the project reaches the hands of lawmakers and they analyse in detail its scope, the Frente de Todos bench – now led by Germán Martínez from Santa Fe following the shock resignation of the previous leader of the ruling coalition's lower house bloc Máximo Kirchner – plans to hold meetings with officials to dispel doubts and try and sway hardline Kirchnerite allies who are hesitant to support the deal.

Another meeting is also expected between officials and leaders of the labour movement and business chambers in order to smooth the bill’s progress.

It has not yet been defined when Guzmán, Chodos and Manzur will appear before lawmakers, but their appearance will take place under the framework of the Budget and Finance Committee chaired by Carlos Heller, with the presence of deputies from all forces to be represented.


Doubts

The text of the IMF bill has already passed the final stages of bilateral review. Any new agreement to replace the one signed by former president Mauricio Macri in 2018 needs approval from Argentina’s Congress and the IMF’s executive board.

The government wants to ensure that the bill is approved by both chambers of Congress before March 22 – the deadline by which Argentina is due to make a US$2.8-billion payment to the Fund.

Both Guzmán and President Alberto Fernández have said that Argentina will not be able to meet that maturity, especially given the concerning level of its Central Bank reserves. Therefore it wants to get the parliamentary process underway as soon as possible.

Most analysts expect the IMF bill to clear Congress, though confidence within the Casa Rosada is not running as high as it previously was. While officials are convinced they have the support of two-thirds of the main opposition coalition, namely the UCR and the Coalición Cívica, Macri’s PRO party has become increasingly hostile. 

During Fernández’s speech marking the opening of normal Congress sessions on Tuesday, the president slammed Macri for agreeing to a deal with the IMF, prompting a mass walkout by the majority of the opposition coalition. 

In addition, there is no sign that four deputies linked by Máximo Kirchner and the La Cámpora political youth grouping are likely to back the bill.

 

– TIMES/PERFIL
 

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