The International Monetary Fund (IMF) evaluated that “We are advancing well towards a (new) program. We are working it constructively with the authorities Argentinas ”and clarified that, although “Wide support is key to the success of this program”, That has approval of Congress is a government decision (that is, it is not a fund requirement). He pointed out Julie Kozackspokeswoman of the agency at a conference offered Thursday in Washington in which she avoided giving details about the content of the new understanding, since, as it transpired, with the Argentine driving it was agreed to hold the conversations in Total Hermeticism.
He also argued that to maintain these first achievements “There is a shared understanding about the need to continue adopting a consistent set of fiscal monetary and exchange policies, while, very important, we advance in growth reforms. ”
Asked about the request for approval of a new program by the Executive Power to the Legislative, Kozack said that “We take into account President Milei’s commitment to seek support from Congress to a new program “ and recalled that, as the background has affirmed, “It is key” for the success of the program that has broad support.
However, he also said “I want to emphasize that obtaining the support of Congress is a decision of the authorities according to the provisions of Argentine internal legislation.”
Consulted by Scope On the march of the treatment, the spokeswoman just pointed out that “the negotiations continue constructively.” In terms of the process by the agency, he said that “once the negotiations are completed, as is the case with any proposed IMF program, the final agreement, the documents, will require the approval of the executive directory” of the agency.
But in relation to the details of the negotiations, he mentioned that ” All I can say now is that this is still under discussion as part of the continuous and constructive dialogue that we are having with the authorities, and we will provide an update when we have more information that we can share with you. ”
Requirement
In order to sign the agreement with the multilateral body, it is a requirement imposed by the Argentine legislation that Congress authorizes the negotiations. In this regard, a high source from the Casa Rosada anticipated Scope that “It is imminent” shipping to the corresponding bill congress. International sources claim that “The agreement is already practically closed since otherwise the order would not be sent to Parliament.”
This initiative will be limited to the authorization request of the administration of Javier Milei to negotiate with the multilateral credit agency, but will not report on the details of the agreementthey need in official sources.
In this regard, they remember that during the former president’s management Alberto Fernándezin 2022, who was a minister at that time, Martín Guzmánhe tried to make Parliament approve the content of the agreement signed at that time. However, they also point out that Sergio Massawho was the head of the Chamber of Deputies, communicated with the authorities of the Fund to consult whether a parliamentary approval of the agreement was necessary. The organism’s response was that It was not necessary.
For this reason, now the articles of the project prepared by the Executive will only include the order to formalize the new program Before the Fund’s Board of Directors discusses, but the memorandum will not be attached to the technical data.
In his discourse to open the ordinary legislative sessions, Milei anticipated that “in the next few days I will ask Congress to support the government in this new agreement with the International Monetary Fund.”
He added that “this new agreement will provide us with the tools to heal the way to a freer and more efficient exchange scheme for all our citizens and to attract greater investments that translate into less inflation, greater growth and level of employment, with the consequences … better salaries that imply less poor and homeless.”
Before, the president had indicated in his presentation that “we are advancing in an agreement with the International Monetary Fund to be able to clean up the balance of the Central Bank and leave the exchange rate definitively during this year.”
Support
In the Casa Rosada it is commented that, consistent with its personality, Milei is hurrying its collaborators so that the aforementioned project will send to Parliament. “Once an initiative announces, the president worries because he is implemented as quickly as possible.”they point out in their environment.
The official expectation is to accelerate the efforts after the new support of Donald Trump Who, in statements to journalists at the White House, also assured that Milei is “A great leader.”
The technical issues of the agreement had already been agreed at the opportunity of the visit made by an IMF mission to the country last January.
At that time, the Argentine program had relevant support after the meeting that Milei held with the president Donald Trump In the United States and, the next day, on Sunday, February 23, the Minister of Economy, Luis Caputo, was received by the United States Secretary of the United States, Scott Besent, Opportunity in which the official praised the Argentine program.
It should be noted that what will evaluate Parliament is whether the new agreement implies more public debt, for this reason is that Milei took care that it is not an increase in indebtedness.
“The present agreement with the IMF what you seek to restore the asset of the Central Bank, and with that its heritage, so that inflation is only a bad memory of the past,” said the president. The intention of the government is to capitalize on the BCRA and ratified its commitment to maintain the fiscal surplus and cut with the monetary issuance to ensure the decrease in inflation and economic recovery.
He urged legislators to approval by promising that: “I want to be clear with one thing: we are going to solve the problem that all previous governments caused with the fiscal deficit and their financing. Consequently, we hope that this Congress adopts the same position they had with everyone else, which is to accompany from their benches, supporting the government in this new agreement, “Milei concluded.
Standing to the dollar
The president advanced in his speech before the Legislative Assembly that to advance in the agreement with the IMF to be able to end up sanitizing the balance of the Central Bank will allow “Exit from the exchange rate definitely during this year.”
Throughout the last months, the government was relaxing the exchange controls, but it is still a lot to do. In repeated opportunities, both Milei and Caputo pointed out that the departure of the stocks would be made in conditions such that they do not generate risks of turbulence in the markets. Precisely the contribution of fresh funds by the IMF would increase liquid reserves and would allow the monetary authority to have greater “fire power” to sustain its exchange policy
Source: Ambito
