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Tuesday, December 6, 2022

Massa confirmed that reserves doubled with the Chinese swap

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Until now, of the US$18 billion of the Chinese Swap, US$473 million was allowed to be used every 90 days, with which, thanks to this agreement reached last Tuesday, they became US$5,000 million until July of this year. next year, and renewable”.

The Swap operation was an exception made by China because Argentina was one of the first to sign the so-called Silk Road.

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The minister pointed out that “this is also very important for the productive sectors of Argentina, because it allows them to have faster access to the flow of dollars for imported inputs and intermediate goods for production in Argentina.”

The meeting with Kristalina Georgieva

Another important point in Bali was the bilateral meeting that Alberto Fernández held with the managing director of the International Monetary Fund (IMF), Kristalina Georgieva, where the value “is having already left the discussion on the price of war open” with that multilateral organization of credit, “and already established that in December the surcharges will be discussed”, Massa pointed out.

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In this sense, the official expressed that Argentina “is paying the IMF double the interest rate that, for example, it pays to the Inter-American Development Bank (IDB),” and considered that this is “absurd when the lender, ultimately, is the Fund.”

Argentina pays 6.6% in interest to the IMF, 5% to the World Bank, 3.9% to the Paris Club and 2.9% to the IDB.

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As for the impact of the war, Argentina left the IMF a report and “the discussion of the 2023 outlook will be in December,” Massa said, after the end of the third quarter, when a report from the technical team is discussed.

When Massa went to the Development Committee two months ago, he raised the economic impact of the war in Ukraine before 20 finance ministers: he said that the southern hemisphere had already paid for it with the most expensive prices for gasoline, gas or fertilizers; and he asked for a quantification of that overload.

In this sense, Massa indicated that, andn next December, the IMF board “will work by blocks.” In the case of Europe – the minister explained – the war will be discussed “because a country at war like Ukraine lends itself to the absurdity that it is paying surcharges.”

The third point discussed with Georgieva was that The IMF will not compute as a deficit the amounts that Argentina made as a counterpart to World Bank (WB) loans, for 230 billion pesos, and that the WB itself puts that total.

Regarding the construction of dams in the country with Chinese investment, the Asian giant committed US$ 500 million, broken down into US$ 223 million that Argentina put up plus US$ 277 million in advance.

The works include the so-called “Amba 1”, an electrical work in Greater Buenos Aires for US$ 500 million, and the network of accessory gas pipelines to the trunk of the Néstor Kirchner dam, for $1,900 million.

Source: Ambito

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