MercoPress. South Atlantic News Agency
Argentine devaluation consistent with IMF guidelines
“We appreciate the authorities' recent policy actions and commitment to safeguarding stability, rebuilding reserves, and strengthening fiscal order,” Kozack said The International Monetary Fund es expected to release over US$ 10 billion to Argentina which might come as some sort of relief following Monday's decision to devaluate the local peso in the aftermath of the government's poor performance Sunday at the Open, Mandatory, and Simultaneous Primary (PASO) elections.
”On July 28, the Argentine authorities and IMF staff reached an agreement at the staff level on the fifth and sixth reviews under Argentina's 30-month Extended Fund Facility (EFF) arrangement. The agreement is subject to approval by the IMF's executive board, which is expected to meet on August 23 and approve the agreed disbursements,“ IMF Director of Communications Julie Kozack said Monday in a statement.
”We appreciate the authorities' recent policy actions and commitment to safeguarding stability, rebuilding reserves, and strengthening fiscal order,” she went on.
The Government of President Alberto Fernández and Economy Minister (and presidential candidate) Sergio Massa expects that the IMF may send US$ 7.5 billion. The IMF board of directors is scheduled to meet in the next few days to discuss the approval of the last technical review and to release disbursements. According to Infobae, the amount could be higher, with US$ 7.5 billion in the second half of August, and another US$ 2.5 billion in early November (after the presidential elections where Massa risks not advancing to the runoff).
Monday's devaluation and interest rate hike are perceived to be consistent with guidelines from the IMF, which insists on cutting the primary deficit beyond the impact of the drought on tax collection. As per an agreement dating back to 2022, Argentina would US$ 44 billion over 30 months in exchange for the central bank increasing its international reserves and the government reducing the fiscal deficit from 3% of Gross Domestic Product in 2021 to 2.5% in 2022, 1.9% in 2023 and 0.9% in 2024.
Top Comments
Disclaimer & comment rules-
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Read all commentsWhoever becomes the next president of Argentina will decide its future. It will either be more of the same, or a complete regime change.
Aug 15th, 2023 - 11:29 am +1It will be a long hard road to recovery, but with a new change it can happen. If it remains the same as present, then the people of Argentina are facing possible total economic failure and destruction of the entire country.
Often looking from the outside in, one can see the cracks that are growing, but convincing those who need to fix it is not easy when looking from the inside out.
Since 1982 and even before Argentina has been troubled by the power of a very dangerous and corrupt regime. They have failed to grasp that opportunity given to them when their dictator was removed with the help of the British who defeated that regime on the Falkland Islands.
This is the chance to start over, turning round the corruption and rebuilding what was once a great country. If the people of Argentina truly do want change, this coming elections will be that opportunity. Use your vote wisely.
Falklands-Free
Aug 15th, 2023 - 03:50 pm +1I completely agree with your sentiment:
“This is the chance to start over, turning round the corruption and rebuilding what was once a great country.”
However, knowing my neighbors - they're hopeless focused on blaming the rest of the world for their numerous problems.
There is a reason why the Argentine populace have the highest quantity of mental care specialists in the world...
¡Saludos de Panquehue!
Problem is that Argentina is in such a bad state that any and all remedies will involve much pain for the population, a hard sell to a population that is already suffering.
Aug 18th, 2023 - 11:03 am 0Much easier to believe in magical solutions and mythical Islands, than face cold hard reality.
As for corruption, until they get a grip on that then nothing is going to work as it should. Here too getting people to stop is ‘a hard sell to a population that is already suffering’.
No pain no gain and no silver bullets.
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