The US Treasury Secretary should be in charge of transferring the indications arising from the Fernández-Biden bilateral. Number 2 of the Fund will be in charge of monitoring the program until May.
Between next Monday and April 9, Argentina and the International Monetary Fund will open a new round of negotiations, already thinking of 2023. And considering everything analyzed, discussed, discussed and debated between the parties on the impact of the drought and the consequences of the invasion of Ukraine by Vladimir Putin In the Argentine public accounts, you eventually make decisions about what the plan of objectives (not goals) will be that the country will have to meet to close this exercise according to the provisions of the Extended Facilities signed in March 2022. But it will not be the most important thing. The most important thing about this 15-day period of time is that it will be possible to verify if last Tuesday’s meeting finally Alberto Fernandez and Joe Biden generated concrete benefits for Argentina, measured in the easing of IMF conditions.
The important detail of the stage that begins on Monday is that the figure of Gita Gopinaththe deputy managing director of the IMF, who also hosted Sergio Massa at the meeting at the organization’s headquarters two hours before the Fernández-Biden summit. It happens that the American is the usual interlocutor of the Secretary of the Treasury Janet Yellenwho, by order of the President of the United States, should be the one who tells the technical staff of the organization to make the conditions of the Extended Facilities more flexible.
In fact, these days, Gopinath is the technical team that is in charge of supervising the progress of the program. At least until arrival at the address for the Western Hemisphere of the Chilean Rodrigo Valdes, who will formally assume his position in May. And who by functions should take charge of the Argentine case. But while this interregnum lasts, and since the control of the country cannot stop at its execution and control, it will be the responsibility of Gopinath.
It will not be publicly recognized for obvious reasons, but from Buenos Aires the situation is not seen with bad eyes. Otherwise. Since Massa’s arrival at Economy in 2022, it is perceived that the technical relationship with the North American number two of the organization was more decisive and quicker in decision-making. At least on the issues in which the economist who emerged from the ranks of the Fund had to act.
What was noted is that his weight before the Board is direct and effective; and that, although she is a tough negotiator and little friend to procrastination, when she defines a discussion, it ends up being carried out without further delay. For example, at the end of last year, she was in charge of endorsing the creation of an extra tax item to be able to serve the sector of Argentines most affected by the crisis, and which resulted in the $45,000 bonus for the most unprotected sectors. The plan had been discussed directly between Massa and Gopinath during the negotiating sessions of the first week of October at the Joint Assembly of the IMF and the World Bank in Washington, where the number two of the organization made it clear to the Argentine minister what was Argentina could do and what not, so that the agreement continues in force. The guarantee worked even though the members of the technical staff led by the Venezuelan Luis Cubeddu were against any fiscal deviation that would alter the calculations to meet the goal of 2.5% of GDP for 2022.
In this sense, the presence of Gopinath as prosecutor of the Argentine case may be good news for Argentina. The Indian-American economist is considered to be more technical and profound, but less amenable to international geopolitical pressures than her predecessors Geoffrey William, Seiji Okamoto and David Lipton. The first, a Republican, was one of those that most hindered the acceleration of the Extended Facilities at key moments in 2021. The second, a Democrat, is considered in Buenos Aires (perhaps as a mistake) as one of those responsible for closing the Stand By agreement in the times of the government Mauricio Macriand (rightly here) as one of those who demanded the most adjustment from Argentina to close the current agreement.
On the other hand, Gopinath is seen as a history of the organization and as a representative of the (always somewhat criticized from the IMF “board”) body of technical economists who are part of the daily and semi-permanent structure of the Fund. In addition, she had to fight from mid-table upwards to occupy the second most important position in the Washington headquarters.
Source: Ambito
