Argentina and the IMF reached an understanding that will change certain terms of the million-dollar debt refinancing agreement signed in 2022 and prevent the South American country from defaulting in the middle of an election year.
The technical delegation from the Ministry of Economy and the Argentine Central Bank that flew to Washington for these negotiations, as well as the staff of the International Monetary Fund (IMF), declared that they had reached an agreement on the objectives and key parameters that will serve as the foundation for a “staff level agreement” with the IMF.
For several weeks, Argentina has been negotiating with the IMF to introduce changes in the fiscal, monetary, and reserve accumulation goals agreed in 2022 and to advance the quarterly disbursements stipulated in that extended facilities agreement, which allowed refinancing debts for 44,000 million dollars contracted with the Fund in 2018 by the then Government of Mauricio Macri (2015–2019).
Through a joint message posted on Twitter, the Argentine Ministry of Economy and the IMF indicated that they expect the talks to end “in the coming days” and then move towards the review of Argentina’s program.
According to official sources consulted by EFE, the “term sheet” (a document containing the conditions and terms of an agreement) is already “closed,” and the “staff level agreement” will be available between Wednesday and Thursday.
It has not yet been formally confirmed whether Economy Minister and presidential candidate Sergio Massa, who is leading the negotiations, will travel to Washington in the coming hours, as has been predicted for days.
According to Argentina and the IMF, the deal aims to “consolidate fiscal order and build reserves, admitting the substantial impact of the drought and the damage to the South American country’s exports and fiscal revenues.”
Argentina, which has substantial macroeconomic imbalances and also suffered during the first semester from the consequences of a severe drought, which had a devastating impact on its agricultural exports—its main source of income—has had difficulty fulfilling the Fund’s agreed-upon goals.
