Friday, January 28

Debt: Argentina calls for the responsibility of certain IMF member countries

The Argentinian president called on Wednesday “to the responsibility” of the member countries of the IMF which authorized in 2018 a loan “not viable”, to support it with a view to an agreement on payment facilities of its debt of more than 44 billion of dollars.

Peronist President (center-left) Alberto Fernandez said he was “optimistic” about the chances “of achieving a restructuring that suits Argentina”. But for his government, “the word adjustment is banned” from discussions with the IMF, he said.

“Adjusting is reducing the economy, stopping growing”, therefore generating less revenue to repay the debt, repeated the Head of State, who assured that the problem of this debt to the IMF will impact the ‘Argentina for “several generations”.

Mr. Fernandez and his Minister of the Economy Martin Guzman reported, to the presidency, on the state of discussions with the IMF to the governors of the provinces.

In the absence of an agreement with the IMF, Argentina will face in 2022 repayment deadlines, between capital and interest, of around 19 billion dollars in 2022 and 20 billion dollars in 2023, “unsustainable”, recalled Minister Guzman.

“We are seeking to redefine this profile of payments,” he explained, stressing that a stumbling block was the approach to “solve the public deficit” without undermining the economic recovery. Argentina, after three years of recession, is expected to register 10% growth for 2021.

Mr. Guzman referred at length to the IMF assessment report at the end of December, which questioned the conditions for granting in 2018 this colossal loan of 57 billion of which only 44 billion were paid in the end.

The IMF admitted, in what amounted to a mea culpa, that the loan strategy and terms “were not strong enough to deal with Argentina’s structural problems”. He also noted “that a number of directors (of the IMF) had questioned the feasibility of these measures”.

MM. Fernandez and Guzman insisted on this point – “a certain number” – returning the ball to the court of the member countries of the Fund which had given the green light to the loan to the government of Mauricio Macri (center-right).

“We call on the responsibility of those who authorized this loan, when it was not viable,” Fernandez said without citing a country. “They have to understand that this time (to repay) that we are asking for is the product of a debt which they themselves (the IMF) say they do not understand how they could have authorized”, a- he concluded.

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