Argentina to receive $9.7b under $44b debt deal: IMF

Agreement allows country to continue strong economic recovery that it is experiencing

WASHINGTON:

The IMF executive board on Friday approved a $44 billion loan for Argentina to help the inflation-wracked country’s economy, with $9.7 billion of the funding available immediately.

The Washington-based crisis lender said the financing “aims to provide Argentina with balance of payments and budget support” and also “strengthen debt sustainability, tackle high inflation, boost reserves, address the country’s social and infrastructure gaps and promote inclusive growth.”

These arrangements are a “step forward” for the “macroeconomic stabilisation” and the “economic recovery” of the country, said Argentine Economy Minister Martin Guzman. The deal “allows the country to continue the strong economic recovery that it is experiencing,” Guzman told AFP in Paris. Argentina’s Senate last month had greenlit a deal with the International Monetary Fund to restructure $45 billion in debt, the legacy of a record loan contracted in 2018 under former president Mauricio Macri.

IMF Managing Director Kristalina Georgieva noted the country struggles with both rapid price increases and low incomes. “Against this backdrop, the authorities’ economic program sets pragmatic and realistic objectives, along with credible policies to strengthen macroeconomic stability and begin to address Argentina’s deep-seated challenges,” she said in a statement.

However, she noted that “risks to the program are exceptionally high, and spillovers from the war in Ukraine are already materialising.”

In 2018, under the government of center-right Macri, the IMF approved its biggest-ever loan of $57 billion to Argentina. The country received $44 billion of that amount.

Published in The Express Tribune, March 27^th, 2022.

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