Wednesday, July 17, 2024

WORLD | 02-02-2024 16:08

IMF denies it is discussing new programme with Argentina

The International Monetary Fund is not negotiating a new programme with Argentina, says Kristalina Georgieva.

The International Monetary Fund is not negotiating a new programme with Argentina, the director of the multilateral organisation Kristalina Georgieva said on Thursday.

“At this point we’re not discussing a new programme,” said Georgieva in a press conference, a day after the Fund's executive board green-lighted the disbursement of US$4.7 billion, the latest tranche of Argentina's US$44-billion loan programme.

Last month, IMF staff officials approved the seventh review of Argentina's credit agreement. 

“Given the ambition they showed when we discussed the seventh review it seemed like review number one, because there’s a drastically different approach,” said Georgieva, who went out of her way to praise President Javier Milei’s plans.

In a country with three-digit inflation, few international no reserves and runaway poverty, “we totally back the decision to approach these problems with more ambition than we have seen in previous years and to tell people the truth,” she stated.

“What I can tell you is that so far we have seen a good team” and “a very pragmatic president, without any ideological limitations,” said the IMF managing director, who said the libertarian is seeking “ways for the country to get out of this difficulty.”

The director of the Fund applauds the government's state desire to eliminate currency controls multiple exchange rates, to prevent monetary financing of the Central Bank and to hit a fiscal surplus of approximately two percent of the GDP this year, before interest payments on debt.

Georgieva expressed support for the Milei government's decision to remove the fiscal chapter from its sweeping Omnibus Law of reforms, in which Milei wants to reach  a “zero deficit” in fiscal accounts.

“It was a pragmatic decision, you move to where you have more consensus,” stated Georgieva, who assured that the IMF had assessed its consequences on established objectives and said she is “satisfied that there is a contingency plan."

“What is very clear is that overcoming such a difficult year will require more planning for contingencies and more agility and adaptability,” she stressed.

“There are risks,” she warned, because “overcoming a big transformation, the Big Bang change, is never easy."

Georgieva has been very critical of late about the last few months of Alberto Fernández’s administration.

“Up to April they did the best they could,” she said at the press conference, admitting thatt “in the last few months the programme derailed completely,” she said.



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