If the Government decides to remain in default with the Fund, the shares could suffer an additional 70% drop in dollars. In addition, bonds would also suffer sharp falls, going from the current levels around US $ 35 to values closer to US $ 20.
In tune, the influential British newspaper Financial Times warned on Wednesday that If Argentina fails to close an agreement with the IMF, the country will remain an “international financial pariah.”
“Argentina is approaching the IMF (agreement) deadline with few signs of progress,” the foreign publication considered.
In that sense, he indicated that “as the March deadline for Argentina to restructure a debt of billions of dollars with the IMF approaches, the country once again runs the risk that international financial institutions will cut off the tap and isolate itself, while the left-wing Peronist government struggles to find support for a new agreement. “
In addition, he commented that the meeting held last week by the Minister of Economy, Martín Guzmán with governors, in which The official admitted that there is no close agreement, “confirming the reluctance of the Argentine authorities about the need to cut spending to reduce the deficit.”
“Argentina must pay the IMF US $ 2.8 billion at the end of March, and analysts see no other option than to secure a new agreement with the lender, because the Government lacks international reserves to make the payment. Net foreign exchange reserves have fallen below US $ 6.9 billion, according to Morgan Stanley, of which only US $ 400 million are liquid, “warned the article carried by Lucinda Elliot’s signature.
For the Financial times, “Most economists agree that defaulting on the Fund would be disastrous. It would cut off the credit Argentina receives from other multilateral lenders and deal a serious blow to the IMF’s reputation as a responsible creditor.“.
“Given that private investors are already shunning Argentina after its brief default in 2020, any confrontation would also leave the country – a member of the G20 and a major grain exporter, and which has been rescued 21 times in six decades – as an international financial pariah.” , he alerted.
At the same time, the British newspaper said that the government “must also confront the hardliners within its own ranks, who resist the proposed cuts in spending and subsidies. They believe that the original agreement with the IMF it broke the Fund’s rules – the IMF denies it – and that the lender should grant Argentina favorable treatment in any new agreement. “
“While the spirits between the Peronists and the opposition are aggravated, the economy suffers. The balance of the Central Bank has deteriorated notably. Net reserves have fallen below US $ S7,000 million and more than US $ 1,000 Millions have left the private banking system only in the last two months, according to official and market data, “he concluded.
Source From: Ambito
David William is a talented author who has made a name for himself in the world of writing. He is a professional author who writes on a wide range of topics, from general interest to opinion news. David is currently working as a writer at 24 hours worlds where he brings his unique perspective and in-depth research to his articles, making them both informative and engaging.
