The International Monetary Fund (IMF) says that talks with Argentina to strengthen the crisis-hit country’s multi-billion-dollar loan programme are “progressing in a constructive manner."
Hit by a historic drought, the country’s worst on record, President Alberto Fernández’s government is seeking to renegotiate targets outlined in the record credit programme as it struggles to deal with a large drop in foreign currency inflows.
The drought is set to cost Argentina around US$20 billion in revenue and, as a result, the targets for reserve accumulation and fiscal deficit outlined in the deal will not be met.
Following face-to-face talks in Washington last week, negotiations are now taking place virtually via Zoom video-conference software, led by Leonardo Madcur, head of advisors at the Treasury, and Gabriel Rubinstein, economic policy secretary and number two at the Economy Ministry.
The multilateral lender confirmed in a brief statement to two local news outlets this week that technical teams from Argentina’s Economy Ministry and the IMF "were working together” to assess and take on board the impact of the drought.
"Technical staff continue to work with the Argentine authorities to strengthen the economic programme agreed with the country in the context of the very severe drought. Exchanges between the authorities and the International Monetary Fund team are progressing constructively," a spokeswoman for the IMF told the Noticias Argentinas news agency, words the same official echoed in a statement to Perfil.
The communiqué issued by the IMF will sign off on a reworking and reformulation of the agreement, in lieu of the challenging economic circumstances facing Argentina.
It also hints that Fund officials are accepting of the government’s policy of intervening in currency markets and using the nation’s scant Central Bank reserves to prop up the value of the peso against the dollar.