MercoPress. South Atlantic News Agency

IMF warn Argentina on ‘lack of progress’ in addressing inflation data

Argentina’ stats’ office Indec at the heart of the controversy

The International Monetary Fund (IMF) warned Argentina about its “lack of progress” in addressing inflation data and called on the country to implement “specific measures” within the next six months to improve it.

“The Executive Board regrets the absence of progress in the adaptation to international statistics standards and took note of the intention of the Argentine authorities to adopt measures to face the quality of the data presented,” the Fund stated in a press release on Wednesday.

However, it does not mention any specific sanctions against Argentina.

The organization insisted on “the obligations of all member countries to provide accurate data to the International Monetary Fund,” which range from inflation to Gross Domestic Product (GDP) levels.

The press release “calls on Argentina to implement specific measures, within a period of 180 days, to address the quality” of its inflation data.

Argentine consumer prices rose 23% last year, the most among the Group of 20 nations, according to opposition lawmakers who base their estimates on reports by economists facing fines of 500,000 Pesos (115.000 US dollars) for questioning the government’s data. The national statistics agency said prices climbed 9.5% in December from a year earlier.

Argentine bonds linked to the official inflation index fell 25% last year as the government fined researchers and failed to implement the recommendations of an IMF report requested by President Cristina Fernandez and submitted in April. Latin American inflation-linked debt fell 0.7% over the same period, according to Barclays Capital.

Norberto Itzcovich, Indec’s technical director, said last September that the methodology used by independent researchers wasn’t of the quality required to accurately measure inflation.

Argentine economists began releasing their own inflation reports in 2007, after then-President Nestor Kirchner changed personnel at the national statistics institute in what he said was a bid to “improve operations.”

In 2010, Cristina Fernandez asked the IMF to help create an index that would reflect current nationwide consumption habits. The government has refused to let the IMF review its finances since 2006, when it paid off its 9.8 billion dollars debt to the lender. The Kirchner ruling couple blamed the IMF for pushing the country into a financial crisis that led to a 2001 default on 95 billion of bonds.

Last month, Gerry Rice, director of the IMF external relations department, said the board wouldn’t apply sanctions against the country for not complying with its recommendations. The IMF board will next meet Sept. 6 to review any changes made by Argentina.