International Monetary Fund Kristalina Georgieva welcomed Economy Minister Martín Guzmán to the multilateral lender’s headquarters in Washington on Tuesday, as talks over Argentina’s multi-billion dollar debt continued.
Georgieva, the IMF’s managing director, said the duo had shared a “good meeting” and that the “close dialogue” between both parties would continue.
“Very good meeting with Minister Guzmán on Argentina’s economic situation and the road ahead,” she wrote in a post on Twitter.
“Our teams are working together constructively to help strengthen economic stability, protect the vulnerable, and promote sustainable growth. Our close dialogue will continue,” concluded the IMF chief.
President Alberto Fernández’s government is seeking to renegotiate the terms of Argentina’s record US$57-billion credit-line, agreed with former president Mauricio Macri’s administration in 2018. The country has received US$44 billion of the funds to date. After assuming office in December 2019, Fernández said he did not want to receive the remaining tranches of the loan.
The government is seeking to agree terms on a new programme lasting up to 10 years, with reports suggesting Guzmán wants a four-year grace period on repayments. Under the current deal, repayments are concentrated from 2021 to 2024, with as much as US$19 billion due in one year.
Argentina’s economy is currently in the grip of a three-year recession, which has been exacerbated by the impact of the coronavirus pandemic. On Tuesday, the INDEC national statistics bureau published official data indicating that GDP contracted by 9.9 percent last year, extending a recession that began in 2018.
According to IMF forecasts, the economy could grow by 4.5 percent, though the government is hopeful the rebound may be even stronger.
This is Guzmán’s first trip to the United States for talks with the IMF since the coronavirus pandemic. He last visited in January 2020.
The minister, who met with investors in New York on Monday and Tuesday, began his day in Washington with a meeting at Argentina’s Embassy with IMF deputy director for the Western Hemisphere, Julie Kozack, and Luis Cubeddu, the agency's chief of mission for Argentina.
Afterwards, he visited IMF headquarters to meet with Georgieva. The minister is due to hold further talks with IMF technical staff on Wednesday.
Talks over a new financing programme continue, but it is unclear how long it will take. Guzmán previously said he wanted to agree a deal before May, but in recent weeks both IMF staff and Fernández have indicated that negotiations may not be closed until after the October midterms.
The president said recently that Argentina was not in a hurry. "When others rush me to renegotiate, my urgency is for those who do not have a house, a roof, a job. My urgency is those who have fallen into the pit of poverty. That is my greatest urgency, not to agree a deal with creditors," he said.
Argentina is due to hold midterm elections in October, a factor that will affect the pace of talks. All parties will be closely watching the results.