MercoPress. South Atlantic News Agency

IMF says Argentina needs to gradually lift currency exchange restrictions

The IMF said Argentina needed to eventually divert from currency controls

The International Monetary Fund Thursday called for a “credible and solid” plan on the part of Argentina and recommended the country gradually loosened all restrictions on foreign currency exchange.

The IMF's “External Sector Report” released Thursday requested Argentina devised a “credible and solid” macroeconomic plan and suggested that limitations on foreign currency exchange be lifted gradually.

The document, which also includes a financial analysis of current capital flows, also pointed out that such a plan needed to be “endorsed by the international community.”

The report also admitted the current cap of US $ 200 only people who meet certain requirements can get through official channels was necessary in the short run but called for its eventual suppression in a gradual manner in order to promote the arrival of foreign investment.

While this report was being drafted, Argentina's Economy Minister Martín Guzmán was renegotiating a US $ 45 billion debt with the IMF inherited from the previous administration of former President Mauricio Macri.

”We are doing well, there is no time limit (for the signing of the agreement). I am not going to sign something that harms Argentines,“ President Alberto Fernández had said last week.

”The prospects for market access in the medium term will depend on the implementation of a solid macroeconomic and structural reform plan,“ the report pointed out, adding that recovering reserves will ”pave the way for market access.”

Argentina received some US $ 4,335 million in August 2021 in special drawing rights (SDR) from the Fund made among all member countries of around US $ 650,000 million. These SDR resources have helped increase the Central Bank's reserves to face maturities until the end of the year.