Sunday, October 17, 2021

ECONOMY | 26-09-2019 15:21

Difficult to find 'quick path forward' for Argentina, says IMF

IMF officials refused to say Thursday when it will disburse last US$5.4 billion of loan to Argentina that was originally planned for mid-September, as reports suggest World Bank and Inter-American Development Bank may also delay payments.

The International Monetary Fund (IMF) "remains fully engaged" in trying to help Argentina, but a rapid solution is complicated by the uncertainty facing the country, a Fund spokesman said Thursday, as officials all but confirmed the next tranche of the troubled country's US$57-billion loan will be delayed.

Reports in local outlets, including Infobae, also suggested additional payments from the World Bank and Inter-American Development Bank would likely also be delayed until after the election. However, officials from the Treasury refuted those claims on Thursday afternoon.

"We will move in the discussions as fast as we can, and try to do the best we can for Argentina in every respect," IMF spokesman Gerry Rice told reporters. "In light of the complex situation and the policy uncertainty it has been difficult to find a quick path forward."

The International Monetary Fund refused to say Thursday when it will disburse the last $5.4 billion of a massive loan to Argentina that was originally planned for mid-September.

Argentina is awaiting release of a US$5.4-billion loan disbursement from the IMF, but on Wednesday acting IMF chief David Lipton told Bloomberg that the financial relationship with Buenos Aires "may have to wait awhile."

Rice pushed back on reports that the IMF has put its relationship with Argentina on hold. 

"That is incorrect," he said in his regular biweekly press briefing. "I don't have specific info on timing, but the discussions are ongoing."

Reporters had asked him whether the organisation will wait for the winner of the October presidential elections to take office on December 10 before releasing the funds. Rice said there is no real delay because the loan programme doesn't spell out a hard deadline.


Newly-appointed IMF Managing Director Kristalina Georgieva, who officially takes up her post October 1, met with Finance Minister Hernán Lacunza in Washington on Wednesday. 

Lacunza's team also met with other key IMF officials, and is expected to return to Washington for the the institution's annual meetings in mid-October, Rice said, saying the "discussions continue very actively."

The Treasury said in a statement yesterday that Georgieva had indicated that “she wanted the first meeting of her administration to be with Argentine officials.”

Acting IMF Managing Director David Lipton also met President Mauricio Macri on Tuesday in New York.

The government has received about US$44 billion so far of the record US$57 billion, three-year loan approved in June 2018 but soaring inflation and rising poverty stirred outrage at the government's belt-tightening measures.

Lacunza, who has been in his post just over a month, also announced initiatives to postpone debt payments to institutional investors, relieving the pressure on international reserves so they can be used to stabilise the currency which spiraled lower in the wake of the election.

Lipton acknowledged that the government's steps have helped calm the situation, but IMF officials decline to speculate on the timing for releasing additional funds.


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