At the beginning of a key week, the Casa Rosada has its sights set on two places where the future of Economy Minister Sergio Massa’s plan is defined: Bengaluru and Washington.
In the last hours, Massa held a meeting at the summit of G20 finance ministers in India with the director of the International Monetary Fund (IMF), Kristalina Georgieva, in which he conveyed his concern about the effects of the war in Ukraine and of the drought in the country to propose a change in the reserves of the Central Bank.
Massa’s team raised the adverse effects of the Argentine economy to justify the difficulty of acquiring foreign currency.
For her part, Georgieva received Massa’s request and highlighted the “good progress” regarding the development of the fourth review planned in the program with the country.
In parallel in Washington there is another mission of the Ministry of Finance before the IMF that awaits a definition on the modifications of the Stall Level Agreement and the conditions that the imminent decision will have.
The change that the IMF would endorse in the Central Bank’s reserves would not reach the fiscal or monetary policy on which work has already been done.
To achieve this IMF gesture, Minister Sergio Massa had designed various diplomatic meetings to add support to back the negotiation.
Massa had stated that the objectives of the economic program for this year are fiscal order, the accumulation of reserves, and orderly monetary programming.
“The consensus with the IMF is that it is better to adapt the work schedule for the year from the beginning to provide predictability and not have to make wavers during the year. The objective is to be realistic and predictable so that the program is really a computer and not a role in the air that is not fulfilled”, warned the minister of economy.
The fourth review of the IMF program will unlock a disbursement of US$ 5.8 billion in March.
Payments made by Argentina to the IMF
So far this year, Argentina has already transferred to the IMF close to US$3.2 billion, which are part of the total maturities of US$19.85 billion that Argentina will have to deal with the organization during the current year, which will be paid with the disbursements of the current program.
The period under analysis is the fourth quarter of 2022, the year that Argentina closed with a primary deficit (not including debt services) equivalent to 2.4% of the Gross Domestic Product (GDP), with an overcompliance of one tenth, since the agreed goal was 2.5%, as reported by the Government last January.
For 2023, the primary deficit goal is 1.9%, in a year marked by several conditions that the Argentine government raised in the discussions in Washington.