Paris Club says Argentina has committed to IMF deal by next March

Argentine authorities are committed to reach an agreement with the International Monetary Fund no later than the end of March as part of an understanding with the Paris Club to avoid default, according to the group’s second-ranking official.

The country also agreed to treat all other external creditors in a comparable way as part of an accord with the group of wealthy nations in which it will make a partial payment, the Club’s Secretary General Schwan Badirou-Gafari said in an emailed response to questions.

“Given the commitments made by the authorities regarding the conclusion of an agreement with the IMF as soon as possible and not beyond end March 2022, as well as their commitment to comply with the comparability of treatment, Paris Club would be in a position to avoid declaring a default at end July,” said Badirou-Gafari.

Argentina announced on Tuesday that it would make a partial US$430-million payment to the club to avoid a default after missing a US$2.4-billion payment that was due last month. As part of the understanding, the country has until March 31 to complete its restructuring with the Club, but Economy Minister Martín Guzmán said that deadline wasn’t going to have any impact on the timeline for IMF negotiations.

The Club demanded Argentina pay the equivalent to what it is due to service Chinese lenders China Development Bank and the Export-Import Bank of China this year, said a person familiar with the negotiations. Club creditors, mostly western governments, were upset that Argentina was seeking to postpone its payments while it continued to service its obligations with Chinese creditors on time, another source familiar with the talks said.

An agreement with the IMF is understood as entering a new loan programme with the Washington-based lender, Badirou-Gafari added later by phone.