IMF hopes for 'progress' soon in talks with Argentina

The International Monetary Fund hopes to see a breakthrough in negotiations for a new programme with Argentina “in the next days,” according to First Deputy Managing Director Gita Gopinath.

“We are adopting a flexible and pragmatic approach,” Gopinath told reporters in Washington during a virtual briefing on the IMF’s new economic forecasts. “We hope we will make even more progress in the next days.”

Gopinath didn’t provide more precise timing. She added that a new programme must be “credible,” and “address the imbalances that the country has.”

Negotiations have stalled between the IMF and Argentina on a deal that would reschedule payments on over US$40 billion of outstanding debt. President Alberto Fernández continues to criticise the Fund for insisting on a faster pace of spending cuts than what his government is proposing.

Talks are entering a critical stage as a US$2.9-billion repayment on the loan given to the prior Argentine government comes due in March. Fernández has said the government can’t pay with foreign reserves at razor thin levels.

While Argentina seeks debt relief, the IMF’s largest shareholder, the United States, wants to see a credible economic plan.

US Secretary of State Antony Blinken met with Argentine Foreign Minister Santiago Cafiero last week in Washington, where he “encouraged Argentina to put forward a strong economic policy framework that will return the country to growth,” according to a statement.