Alejandro Wernerformer director of the Western Hemisphere Department of the International Monetary Fund (IMF)made a warning around the new agreement of Javier Milei’s government with the agency, which would imply a Us $ 20,000 million disbursement.
Werner explained Thursday that The IMF will not make these disbursements without exchange flexibility and the implementation of a clear strategy for the departure of the stocks. Anyway, he referred to the agreement as a “good news.” In addition, he did not rule out that after the election “The background is willing to expand those amounts“When there is already” a strategy Very clear of flexibility of the exchange market and the removal of the stocks “.
Werner talked about the IMF agreement with the government
Under this context, Werner explained that Argentina has payment commitments with the IMF for about US $ 15,000 million in the next three years and that the disbursements could be distributed in 2025, 2026 and 2027, leaving US $ 5,000 million free availability, or concentrate in 2025 and 2026, which would allow to dispose of up to US $ 12,000 million. “It will be important to know what the agreement is,” he said.
“If this is a very different loan, If this is a stand by Six months, where they give three payments of nine in nine months, or give it three payments of US $ 6.5 billion, it would be very different and Argentina would have a very large amount, probably to eventually remove the stocks, “he added.
And he warned: “The fund will not disburse these US $ 20,000 million totally if there is no exchange flexibility. That does not have to come now, but we can come, say, in the third review of the program, that is at the end of the year 25 or early 26 “.
“The focus will be moving to exchange flexibility And in the liberalization of the capital account in a gradual and prudent way, “he concluded.
Javier Milei defended the agreement with the IMF and denied a devaluation: “Talking about the exchange rate is irrelevant”
President Javier Milei went out to support the Minister of Economy Luis Caputo who on Thursday advanced that government expects a disbursement of US $ 20,000 million from the IMF and ruled out a devaluation by saying that it is “Irrelevant exchange discussion.”
“Talking about the exchange rate is irrelevant because I am going to have so many dollars that they support the monetary base, that they could remove all the monetary base from the official exchange rate and they would have plenty U $ 24,000 million”He said in radio statements.
In radio statements, Milei assured that the loan with the IMF – more contributed by the World Bank, the IDB and CAF – will allow “Bring the Gross International reserves au $ 50,000 million. That is, the balance of the Central Bank that today has gross international reserves of US $ 26,000 million, would count At least with US $ 50,000 million“
“If I take the monetary base in the traditional format, which has to do with the weights that we use to make transactions and the lace of the banks, that is, the cash that the banks have in cash, those are $ 29 billion. If I have those $ 29 billion convert them to the official exchange rate, Argentina’s monetary base is $ 26000 million dollars“The president said in radio statements to El Observador.
According to the libertarian, this means that “each weight has twice the support of dollars, basically, to the official exchange rate.” “If we do it at the parallel exchange rate, 1300, the monetary base would be US $ 22000 million. That is, I have US $ 500 billion to support US $ 22,000 million. I mean, I have more than double. “
Along these lines, the president again ensured that “this agreement does not raise the debt because it is to take those BCRA funds to pay the debt that the treasure with the BCRA has.” As he exemplified, the counterpart of that will be that we are going to have “Less inflation.”
Finally, the libertarian differentiates his agreement from the rest because Argentina has already made the fiscal adjustment that the IMF usually demands. “In the Argentine case the difference is totally abysmal because in the Argentine caseArgentina already made the adjustment. Argentina made adjustments much deeper than those demanded by the international monetary fund itself. “
Source: Ambito
