Saturday, September 26, 2020

ECONOMY | 13-12-2018 14:20

IMF: Argentina's economic programme is yielding results

IMF board due to meet next Wednesday to approve next installment of expanded US$56-billion loan deal.

Argentina's economic programme, including tough budget cuts, is yielding results and stabilising financial markets, a spokesman for the International Monetary Fund (IMF) has declared.

The key now is to press ahead with the reform policies to return to growth, IMF spokesman Gerry Rice told reporters.

The IMF board is due to meet next Wednesday, December 19, to approve the next installment of the expanded US$56-billion loan deal approved for Argentina in late October. That would release a further US$7.6 billion to the Mauricio Macri administration.

"The programme is in fact yielding positive results," Rice said at a press briefing. While declining to comment on daily movements of the stock markets, he noted that "broadly, financial markets we feel have stabilised and the fiscal deficit has been tackled decisively."

The government has imposed tough, and predictably unpopular, belt-tightening cuts as part of the IMF programme.

Macri and his economic team are committed to moving forward with the programme, Rice said, while acknowledging the difficulties faced by the citizens in Argentina.

"Our view is that with implementation there will be a return of confidence and that will lay the basis for return of growth," he said.

The country secured a US$50-billion IMF loan back in June and had received US$15 billion of the funds but as conditions worsened Buenos Aires had to go back to the lender for additional support with faster disbursement.

Economic turmoil was brought on by a rapid loss of confidence in its currency early this year, which exacerbated the downturn already underway due to the severe drought.

Addressing another crisis-stricken Latin American nation, Rice confirmed the Venezuelan government had provided economic data to the fund and staff were reviewing the information to see if it meets the requirements.

The IMF board in May censured Venezuela for failing to provide key macroeconomic data. Even without it, the IMF estimates the hyperinflation besetting the country could reach astronomical levels up to 10 million percent next year.


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