Government to change IMF bill to get opposition backing

Lower House Speaker Sergio Massa agreed on Wednesday to change the bill that underpins the government’s US$45-billion agreement with the International Monetary Fund in exchange for the opposition to support it.

The wording in the bill’s second article will be replaced, Martín Tetaz, a lawmaker for Argentina's main opposition coalition Juntos por el Cambio, told Bloomberg News after negotiations with Massa.

The article had stated that Congress would support the government’s financial and economic policies as outlined in its staff-level IMF agreement, a commitment that risked the opposition blocking the bill.

Tetaz added that the opposition coalition would vote in favour of the agreement with the second article removed or replaced, a move that opens a path for the bill to pass in the Chamber of Deputies and continue to be debated by the Senate. A deal reached with the IMF earlier this month faces a divided Congress – including criticism from within the government's coalition – before it’s sent for approval by the lender’s board.

The government aims for the deal to be finalised before March 22, when it will need to make payments to the IMF worth US$2.8 billion.

The first article of the bill, approving IMF financing, would remain in the legislation, according to Tetaz and a congressional official familiar with the matter who asked not to be named discussing private conversations. The coalition is also pushing to include an article on prohibiting tax increases, but it’s unclear if that will be included, Tetaz added.

Massa, a key leader in the ruling coalition, met with President Alberto Fernández Wednesday to discuss the opposition’s request to change the text, according to two people familiar with the meeting.

Economy Minister Martín Guzmán, who is in Houston at an energy conference, sees modifying the bill as a potential risk to getting approval by the IMF’s Board of Directors, according to a person familiar with his thinking.

Press offices from the Economy Ministry and the Casa Rosada didn’t immediately respond to requests for comment. Massa’s office declined to comment.