The president Javier Milei will make his first official trip to USA for the presidential inauguration of donald trump together with the Minister of Economy, Luis Caputoand other officials. Official sources indicated that the agenda has not yet been defined in USA. However, The visit to the North American country could be key as the Government seeks to reach a new agreement with the International Monetary Fund (IMF) with new disbursements.
The trip that begins in the United States is scheduled to end in Swissin order to look for new investors in the Davos World Economic Forum. Through the publication of Decree 17/2025 in the Official Gazette, the Cabinet gave the green light to the trip presented by the president.
The President himself acknowledged in radio statements that To get out of the trap you would need US$12,000 million. Although the agenda has not yet been defined, it is worth noting that the last visit of the head of the Treasury Palace He kept the United States busy in September with a series of meetings with investors, in which he defended the economic plan.
Javier Milei visits the US with a view to a new agreement with the IMF
Milei’s visit to the United States occurs in a key contextsince the president donald trump could be the leverage needed to unlock a new deal with the IMFwhich today is one of the main interests of the Government to be able to dismantle the stocks. Now, Is the multilateral credit organization going to grant new financing to Argentina with the dollar in arrears? Is the libertarian administration willing to devalue again and have that translate into inflation before the elections? Is Milei thinking about a free trade agreement?
The chief economist of Faith, Pedro Gaitewas skeptical of the possibility of an agreement before the elections. The thing is, “The Government is very convinced that the exchange rate policy is not touched because it is the axis of the inflationary policy, which in turn is the priority”. At the same time, if there is no exchange rate correction, the specialist does not believe that there could be disbursements from the international organization.
“The agreement with the IMF would remain until after the elections – in his opinion – since there the Government could eventually carry out a more or less controlled devaluation with the arrival of funds and perhaps with some lifting of exchange controls.”
The Government plans that the primaries of the legislative elections will be held on August 3in case they are not eliminated as the ruling party intends, and October 26 for the generals. After this date, the Executive can give in to the exchange rate policy and implement a devaluation.
What possibilities exist of a Free Trade Agreement with the US?
There are conflicting visions in front of a Free Trade Agreement (FTA)since while some specialists point out that it cannot be done because it would break the rules of the Mercosur and the block should be broken, other actors emphasize power “flexible” import and export regulations for a certain period of time, as the former Brazilian president did at other times, Jair Bolsonaro.
However, a FTA For Argentina it could be harmful, because it exports raw materials and imports manufactures. In this way, the economy could be prioritized and the industry could be more affected than it is currently.
“In terms of the Free Trade Agreement it seems to me that It would not be entirely favorable for Argentina basically because exports to the United States are primary products, energy, among others, and what we import are manufactures, so “The risk that is run there is that the deindustrialization and primarization of the Argentine economy will deepen.”Gaite analyzed.
The economist also emphasized that an “import penetration” is already taking place in the industry with how cheap the dollar is and the openness of trade. “Industrial imports are growing much faster than production and a free trade agreement with the United States would deepen this trend,” Gaite argued, although he clarified that this trend could be in the medium term.
For the foreign trade specialist and director at the consulting firm ABECEB, Gustavo Peregoa free trade agreement with the United States would generate “greater investments” due to the displacement of value chainswho previously went to China and today go to Latin America. However, Argentina did not attract any of these investments, due to the economic closure. He also mentioned the possibility of having better access to technology and entry to the financial market, that “Argentine companies can be in the United States and North American companies that can come to Argentina.”
Source: Ambito
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