Buenos Aires Times

economy STAND-BY LOAN PACKAGE

IMF moves to release US$7.6b payment to Argentina after second review

The decision to speed up payments of a multi-billion-dollar loan package comes after Buenos Aires reached a deal with the IMF on the money supply, interest rates and an exchange rate framework.

Tuesday 27 November, 2018
IMF Managing Director Christine Lagarde moderates a discussion on
IMF Managing Director Christine Lagarde moderates a discussion on "Reforming the Euro Area: Views from Inside and Outside of Europe," during the 2018 Spring Meetings of the International Monetary Fund and World Bank Group at IMF Headquarters in Washington, DC, April 19, 2018. Foto:AFP-SAUL LOEB

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The International Monetary Fund (IMF) has concluded the second review stage of its assessments into Argentina's economy, paving the way for the release of a US$7.6 billion loan disbursement.

Argentina secured a "stand-by" loan package with the IMF in June. The total amount of the loan is currently US$56.3 billion.

The Fund's executive board must now approve the November 9 to 16 review. It was prepared by technical staff in Buenos Aires in collaboration with Economy Minister and Central Bank Governor Guido Sandleris, an IMF statement read.

“IMF staff and the Argentine authorities have reached a staff-level agreement on the second review of the economic program supported by the Stand-By Arrangement. Completion of the review is subject to the approval of the IMF’s Executive Board and would make available SDR 5.5 billion (about US$7.6 billion)", the IMF said announced.

It "commended" Mauricio Macri's economic team for its "reform program, including building political support for key budget legislation".

Economic decisions to date, the Fund added, had paved "the way for a rebound of economic activity in 2019 and to support job creation, reduce poverty, and improve the living standards of all Argentines".

"Recent data suggest that achieving the 2018 fiscal target is well within reach", the statement added. 

"Eliminating the primary fiscal deficit is a necessary step to reduce the government financing needs and put the debt-to-GDP ratio on a downward path".

The decision to release the payment comes after Buenos Aires reached a deal with the IMF on the money supply, interest rates and an exchange rate framework.

In exchange for these measures, the Fund agreed to speed up payments of the loan granted in June to Latin America's third-largest economy, now in another economic crisis.

-TIMES

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