Economy Minister Luis Caputo has confirmed that Argentina will seek “fresh funds” from the International Monetary Fund (IMF) in a new financing agreement.
However, the official warned that a deal is far from imminent and that negotiations are part of a “long process.”
The remarks were delivered 24 hours before Caputo met with the IMF’s top two – Managing Director Kristalina Georgieva and her deputy Gita Gopinath – in Washington on Thursday.
Caputo travelled to the United States to attend the IMF and World Bank annual general meetings.
“We are analysing a new programme to consolidate what we are doing and the additional money could alleviate the Central Bank's reserves. We are beginning to discuss it, but it is a long process,” Caputo said in remarks reported by the Clarín newspaper.
The government hopes to be able to start negotiations in the coming months in search of a new programme.
Despite his remarks, Caputo has not yet submitted a formal request for a new programme to the Fund, the Times understands.
Caputo made the comments Wednesday after being named “Finance Minister of the Year” by the LatinFinance publication.
Georgieva also praised Caputo after their Thursday meeting, saying the award is “well deserved, because we observe Argentina's objective and economic indicators and we see the improvements,” reported the La Nación daily.
She said their discussions were “very good.” Economy Ministry sources said the IMF is “very pleased with the results we are achieving.”
Prior to that, Caputo attended a meeting of G20 finance ministers and met the Fund's number two, Gita Gopinath, for around an hour.
He also hinted to the press that a deal with the IMF would likely be concluded next year.
After receiving his award, a bullish Caputo reiterated that President Javier Milei’s government is “making structural reforms.”
“We're not promising that we're going to achieve fiscal stability, we are. We're not promising that the Central Bank will stop printing more money, it's not doing that anymore. We're not promising that we're going to get to the end with inflation under control, it's already coming down,” he said, detailing the Milei administration’s achievements.
Taking questions from journalists after the ceremony, Caputo said that talks with the IMF were “not a question of time.”
“It's a question of agreeing what we want to do in the next phase of the programme. They have to agree to that, and if that is the case, we have to negotiate the conditions. It's going to take time,” he said.
Regarding the arrival of disbursements of “fresh funds” from the multilateral lender, he said that “it is being discussed among the team and with the IMF itself,” adding that “additional money” would take pressure off the Central Bank.
Existing programme
Argentina currently has a US$44.5-billion credit programme with the IMF, which provides it with fresh funds to make existing repayments on the condition that the nation’s quarterly accounts meet with approval.
Senior government officials, speaking off-the-record, said earlier this year that the IMF was open to a new programme and that talks had begun, though Caputo later poured cold water on those reports.
In June, however, Caputo told business leaders at an event in Buenos Aires that Milei's government would seek a new deal, stating that negotiations would begin after the approval of Argentina's latest quarterly review.
Last month, the minister told investors in New York that Argentina may combine the final two staff-level reviews of the current programme into one, then proceed with negotiations for a new programme that would take about three to six months.
Government officials have not specified how much additional money it will seek from the IMF, though President Milei has stated he would need around US$15 billion if he is to remove capital controls (known locally as the ‘cepo’) and ease access to foreign currency.
Earlier this week, President Milei said that he would remove controls immediately “if someone gives me the money” – a comment some analysts saw as a direct message to the IMF.
Although Caputo announced months ago that Argentina would seek a new programme, talks haven’t advanced after President Javier Milei criticised the policy views of IMF Western Hemisphere Director Rodrigo Valdés.
The IMF announced last month that Valdés chose to step away from the Argentina programme and delegate negotiations to his deputies.
The government has met its fiscal and monetary targets within the IMF programme, an improvement from the previous administration that missed all of its benchmarks.
However, the Central Bank still struggles to build up its foreign reserves that are crucial to lifting currency controls and returning to international markets.
The IMF has yet to comment publicly on Caputo’s remarks.
– TIMES/NA/BLOOMBERG
Comments