Argentina is experiencing a particularly "difficult" time amid the coronavirus pandemic, which has rocked the entire world and will spark the worst global recession in more than a century, IMF Managing Director Kristalina Georgieva said Wednesday.
Georgieva made reference to Argentina, which has gripped by recession for two years and is heavily indebted, during a video conference call at the opening of the boreal spring meetings of the International Monetary Fund (IMF) and the World Bank.
"Argentina has been very focused on addressing this crisis with the appropriate sequence of measures on the health front, as well as supporting the most vulnerable people and the most vulnerable segments of the economy," said Georgieva, offering the government her tacit support.
The IMF chief also made reference to the debt issue, with President Alberto Fernández and Economy Minister Martín Guzmán set to offer a debt restructuring proposal to its international creditors later today (Thursday,) The government is seeking to to "reprofile" around US$70 billion in bonds, of a total debt burden of more than US$311 billion – almost 90 percent of Argentina's gross domestic product (GDP).
"It is really a difficult time for everyone, but in particular, it is difficult for countries that entered this crisis facing already complex challenges," Georgieva said.
She added: "In the same way that the virus affects people with pre-existing conditions, those who are more vulnerable, more harshly, it also affects economies with pre-existing difficulties more hard."
In its latest report, the IMF predicted that Argentina would face a third year of recession, predicting a contraction of 5.7 percent in 2020. The Fund expects the economy to grow the following year, in 2021, by 4.4 percent.
The Fernández administration will now open talks to restructure some US$68 billion of debt with private creditors held under foreign jurisdiction.
Georgieva said last month that "substantial relief [from] private creditors" would be necessary in order to "restore sustainability" of Argentina's debt-burden.