(From Washington, United States) The board of directors of the International Monetary Fund will approve today a disbursement of 800 million dollars in favor of Argentina, after having overachieved goals scheduled for the first quarter of 2024. In addition, the IMF Board will insist to the Government with the need to deepen social measures to mitigate the consequences of the adjustment plan.
The board’s decision will be the starting point of an upcoming negotiation between Argentina and the IMF to agree on a new program starting in 2024. The president Javier Milei and the managing director of the Fund, Kristalina Georgievathey will meet tomorrow at the summit of the Italy G7 to prepare the stage that will then be occupied by the Minister of Economy, Luis Caputoand the deputy manager of the IMF, Gita Gopinath.
Milei and Caputo They want an IMF program that extend the terms of payment of the debt and interest, which bail the percentage of the overcharges and that include an extra outlay of 10 billion dollars.
“We are in the process of reevaluating the Fund, which will be on June 13 and from there we will begin.” to negotiate a new program”, Caputo noted.
And he added: “We are not announcing it now because we must first agree with the Fund and try to get new money with that program.”
The head of state and his Minister of Economy consider that the Fund should satisfy Argentina’s proposal regarding the loose compliance of the program goals that the administration of Alberto Fernandez I had put on the verge of default.
The IMF board and its staff, led by Georgieva and Gopinath, They will not support the proposal which – broadly speaking – was already defined in the Fourth floor of the Treasury Palace. The bottom will not reduce surcharges already priori nor will it grant an extra disbursement to strengthen the reserves of the Central Bank and open the financial stocks.
The IMF uses surcharges to maintain your own bureaucracy and the extra outlay it could only be a fact if Donald Trump defeats Joseph Biden in the presidential elections of the November 5th. The current Secretary of the Treasury, Janet Yellen, praises the Government’s adjustment plan. But she would not open her hand – with the previous background of Mauricio Macri and Alberto Fernández – in favor of Argentina.
Trump, however, He has ideological and personal affinity with Milei and I would not hesitate to support the president. This possibility is already on the Government’s political and economic decision board, and from November 6 could become the Plan A.
The IMF board will approve today the planned disbursement for the eighth review and will insist with the need to approve new official initiatives to support those mainly affected by the adjustment plan. The disbursement will be 800 million dollars and tomorrow It will appear in the reserves of Central bank.
“We have been emphasizing the need to increase social assistance to support the poor, ensuring that the burden of adjustment do not fall disproportionately on working families and recommending that authorities make efforts to increase assistance,” said Julie Kozack, IMF spokesperson, in her latest press conference.
In this context, Kozack encouraged the economic team to “give higher priority to micro-level reforms than can unlock barriers to entry that can promote formal employment in the country and attract private investment.”
Kozack’s claim is reflection of the majority thought on the Fund’s board. And when your official statement is known there will be a direct mention to the social debt that the Casa Rosada still maintains with the main affected of the adjustment program that began six months ago.
