“Yesterday there was a staff meeting, they are all steps towards the agreement. The Government is simultaneously carrying out direct dialogue with different countries that are part of the board. We are taking steps in the right direction towards the best possible agreement of the largest debt contracted It is not the best solution ever, it is the best possible solution to a problem that we inherited from Mauricio Macri”, said Thursday the spokeswoman Gabriela Ceruti at a press conference.
During the meeting in Washington, which was made virtual and face-to-face, the staff updated the possible authorization for the country to receive a loan of more than 100% of its annual quota, a necessary step to refinance the multimillion-dollar loan that Macri took. for almost $45 billion.
Alberto Fernandez and the Minister of Economy, Martin Guzmanannounced weeks ago a principle of agreement with the IMF on some central axes of the Extended Facilities program that is being negotiated to replace the failed stand-by of 2018. The Legal and Technical Secretariat, Vilma Ibarrayou have the text ready. However, there are still steps to be taken.
For almost four hours, the members of the board representing each member country of the Fund listened to Julie Kozack and Luis Cubbedu, responsible for explaining the fine print of the agreement. Then there was a round of questions. The doubts went through the feasibility of the tax commitment that Argentina must assume, the estimated level of growth and how the country will do to meet the assumed goals. The Argentine negotiator Sergio Chodos was there to defend the position and offer confidence.
To put in numbers: in 2022 the Government must lower the deficit from about 3% of GDP to 2.5%, that is, an adjustment of 0.5 points of Product. At the weight and size of today’s GDP, this would imply some $235,000 million. All guns point to subsidies.
But Ambit also revealed that the document under discussion indicates an estimated growth of between 3.5% and 4.5% in 2022. However, the projections for subsequent years included in the letter of intent could raise some questions, since the estimated (and sought) growth of the Casa Rosada, on average, per year, will be 1.7% to 2.2% per year, that is, low growth. This projected “landing” in the activity -which will surely be in charge of conserving the dollars to accumulate in reserves and start paying- will be done, they maintain, at the same time, reducing inflation, in a gap that would go between 35 and 45% approximately by the end of 2022. The promise that Guzmán will turn to Congress will say that, in his plans, there will be a commitment to reduce inflation by 5% per year with a “arrival” date in 2024.
The two exhibitors before the IMF were confident that in the next few days the acceptance of the board of directors to the agreement will be officially announced. Then, it will be the turn of the National Congress and the parliamentary debate. Without that law on March 22 Argentina will once again fall into default.
Source: Ambito
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