IMF negotiates new aid program for Argentina from November

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The International Monetary Fund (IMF) will send another mission to Buenos Aires in November, with the objective of starting talks on a new aid program for Argentina, a country that faces “exceptionally difficult challenges without easy solutions” – the institution said on Monday (12).

A fund team met with authorities in Buenos Aires from October 6 to 11 to discuss the country’s challenges in the midst of the coronavirus pandemic – including the billionaire debt contracted with the organization – and to “exchange views on the best way to approach them, ”said the IMF in a statement.

“The team plans to return to Buenos Aires in mid-November to start discussions on a new program supported by the IMF,” says the note.

At the beginning of the mission last week, IMF managing director Kristalina Georgieva said that the organization does not arrive in Argentina with the proposal to “be part of a lasting solution”.

The IMF “does not intend to put pressure on Argentina at this time,” Georgieva told CNN.

“We are very clear in this crisis that it is important to support companies and, more importantly, workers”, he added.

With inflation of more than 40% at an annual pace and in recession since 2018, Argentina also saw the rates of poverty (40.9%) and unemployment (13.1%) soar, amid the pandemic of the covid-19 . According to IMF projections, its GDP will contract by 9.9% in 2020.

‘No easy solution’

Julie Kozack, deputy director of the IMF Department of the Americas, and the head of the Mission for Argentina, Luis Cubeddu, highlighted the scope of the Argentine crisis in a joint statement.

“Argentina faces complex economic and social difficulties, in the context of an unprecedented health crisis. The deep recession caused an increase in the already high levels of poverty and unemployment, the effects of which are exacerbated by significant pressures on the foreign exchange market, ”they said.

“These are exceptionally difficult challenges, with no easy solutions. A comprehensive set of policies can support the restoration of confidence, but it must be properly calibrated to foster economic recovery and ensure macroeconomic stability, ”they noted.

“We share the authorities’ commitment to policies that guarantee fiscal consolidation favorable to growth and, at the same time, protect the most vulnerable, allow a gradual reduction in inflation and stimulate job creation, investment and exports”, they indicated.

Kozack and Cubeddu considered meetings with the Alberto Fernández government “productive”, as well as with congressmen, members of the private sector, unions and representatives of civil society.

Argentina has an agreement in force with the IMF of US $ 57 billion since 2018. Of that total, it received US $ 44 billion in the midst of an exchange crisis.

Fernández refused to receive the rest of the money when he took office last December, while seeking an agreement with private creditors to restructure debts of more than $ 100 billion.

The relationship with the IMF was resumed in 2018, after being frozen in 2006, after payment of its debt with the institution.

Speaking at the UN General Assembly last month, Fernández said that negotiations with the Fund will be addressed, “with respect to the commitments made, while avoiding jeopardizing the conditions that allow economic reactivation”.

Source: G1

The International Monetary Fund (IMF) will send another mission to Buenos Aires in November, with the objective of starting talks on a new aid program for Argentina, a country that faces “exceptionally difficult challenges without easy solutions” – the institution said on Monday (12).

A fund team met with authorities in Buenos Aires from October 6 to 11 to discuss the country’s challenges in the midst of the coronavirus pandemic – including the billionaire debt contracted with the organization – and to “exchange views on the best way to approach them, ”said the IMF in a statement.

“The team plans to return to Buenos Aires in mid-November to start discussions on a new program supported by the IMF,” says the note.

At the beginning of the mission last week, IMF managing director Kristalina Georgieva said that the organization does not arrive in Argentina with the proposal to “be part of a lasting solution”.

The IMF “does not intend to put pressure on Argentina at this time,” Georgieva told CNN.

“We are very clear in this crisis that it is important to support companies and, more importantly, workers”, he added.

With inflation of more than 40% at an annual pace and in recession since 2018, Argentina also saw the rates of poverty (40.9%) and unemployment (13.1%) soar, amid the pandemic of the covid-19 . According to IMF projections, its GDP will contract by 9.9% in 2020.

‘No easy solution’

Julie Kozack, deputy director of the IMF Department of the Americas, and the head of the Mission for Argentina, Luis Cubeddu, highlighted the scope of the Argentine crisis in a joint statement.

“Argentina faces complex economic and social difficulties, in the context of an unprecedented health crisis. The deep recession caused an increase in the already high levels of poverty and unemployment, the effects of which are exacerbated by significant pressures on the foreign exchange market, ”they said.

“These are exceptionally difficult challenges, with no easy solutions. A comprehensive set of policies can support the restoration of confidence, but it must be properly calibrated to foster economic recovery and ensure macroeconomic stability, ”they noted.

“We share the authorities’ commitment to policies that guarantee fiscal consolidation favorable to growth and, at the same time, protect the most vulnerable, allow a gradual reduction in inflation and stimulate job creation, investment and exports”, they indicated.

Kozack and Cubeddu considered meetings with the Alberto Fernández government “productive”, as well as with congressmen, members of the private sector, unions and representatives of civil society.

Argentina has an agreement in force with the IMF of US $ 57 billion since 2018. Of that total, it received US $ 44 billion in the midst of an exchange crisis.

Fernández refused to receive the rest of the money when he took office last December, while seeking an agreement with private creditors to restructure debts of more than $ 100 billion.

The relationship with the IMF was resumed in 2018, after being frozen in 2006, after payment of its debt with the institution.

Speaking at the UN General Assembly last month, Fernández said that negotiations with the Fund will be addressed, “with respect to the commitments made, while avoiding jeopardizing the conditions that allow economic reactivation”.

Source: G1

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