MercoPress. South Atlantic News Agency

Argentina “suspends” payment

The Interamerican Development Bank announced this Wednesday the suspension of credit disbursements to Argentina after this country failed to make a crucial 681 million US dollars re payment.

According to an official release from the IDB, Argentina justified the decision alleging "technical matters derived from financial restrictions for the public sector that respond to the charter of the Central Bank".

Argentine Economy Minister Roberto Lavagna said the "delay will be brief" and anticipated the situation will be "resolved in the framework of a broader refinancing agreements with multilateral organizations".

The Washington based bank stressed that given the non payment situation it has suspended its loan programme to Argentina.

The decision comes in the middle of complicated negotiations between Argentina and the International Monetary Fund that is expected to consider a letter of intent from the caretaker Duhalde administration January 23, when it will have to decide whether to grant financial aid to the country after an ongoing year of negotiations.

The Duhalde administration has repeatedly refused to use reserves to pay its debts dues unless it has firm guarantees that the IMF will grant financial aid. Argentina a month ago defaulted on a World Bank debt claiming the same reason.

The program under discussion with the IMF has been described as "provisional" since Argentina will be holding presidential elections April 27.

In Buenos Aires Mr. Lavagna was rather reluctant to talk about the current negotiations with the IMF simply saying that they "were on course", adding that Argentina will honour its financial commitments with the multilateral organizations.