The news was well received by AdCap Grupo Financiero’s partner, Javier Timermanwho assured that the understanding “has two very positive things: on the one hand, it is a realistic agreement that allows both the IMF and Argentina to give each other an opportunity to generate mutual trust.”
“An agreement with very long-term objectives would be very difficult to meet, instead with objectives subject to revisions of a two-year program, until then the whole package is renegotiated again, and demonstrate compliance given the history with the Fund, It’s positive,” he said.
Regarding the vote in Deputies, he considered that it reflects “for the first time a political compromise between two very opposing forces”, something that demonstrates “maturity in Argentine politics, which is the most important thing for investors”.
In this way, he considered that “the market is seeing a positive change since yesterday (for Thursday), the possibility of dialogue between two political forces that gather 90% of the votes, a dialogue that will be needed for the next 20 years “.
The ruling party’s project is debated in a tumultuous economic context worldwide as a result of Russia’s invasion of Ukraine to prevent the advance of NATO.
Asked about the risks that Argentina does not meet the proposed objectives, the specialist stated that “the new global financial engineering” will prevent the relationship with the IMF from being interrupted.
“If anything characterizes the new world financial engineering, it is the ability to adjust to external shocks and to get out of orthodoxy, and the Fund’s technical team will know how to evaluate the shocks of the war, as it did with the pandemic,” he observed. .
While the Nobel Prize in Economics, Joseph Stiglitzonce again expressed his support for the national government and warned that the war “inevitably will experience shocks” for Argentina, “positive and negative.”
“As Covid-19 remains ubiquitous and in light of ongoing geopolitical conflicts, the risk of negative impacts is real,” deepened the mentor of the Minister of Economy, Martín Guzmán.
“After promoting failed adjustment policies for a long time, the International Monetary Fund has accepted an agreement that will allow the government of Argentina to pursue a pro-growth strategy. The task now will be to manage the inevitable shocks that will arise from the tumultuous global economic environment. current,” he considered.
He added: “Argentina, for its part, has demonstrated the benefits of an alternative, growth-focused strategy. When the economy is allowed to expand, tax revenues can rise rapidly.”
Likewise, in a joint publication with the co-director of the Center for Economic and Political Research in Washington, and an expert on the Argentine case, Mark Weissbrotin Project Syndicate, criticized the approved loan for Mauricio Macri “without conditions”.
This lack of limits caused “capital flight, economic contraction and dizzying inflation, which reached 53.8% in 2019”, they pointed out.
For his part, the economist from the PXQ consultancy and former Vice Minister of Economy of Cristina Fernández de Kirchner, Emanuel Alvarez Agisdescribed as “a great achievement” to have reached an agreement with the IMF under a program like the one being discussed.
According to the economist, in general in the agreements “the Fund usually asks you to accumulate reserves, and in this case it pays us to make a reasonable monetary policy; that you do not delay the exchange rate, you raise the rate to positive levels in real terms , helping to calm expectations and improve yields”.
In this case, “the Fund says just in case I put the money and see if that helps to stabilize,” he added.
Álvarez Agis also pointed out that the war between Russia and Ukraine caused “drastic” changes in the global economy.
“Meeting these goals is a before and after, of the Russian invasion of Ukraine,” with an assumption of an import price of LNG of 20 dollars, and all this dynamic changed dramatically as a result of the conflict, he explained.
Source: Ambito
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