The Argentine President, Alberto Fernandezaffirmed this Friday that the agreement with the International Monetary Fund (IMF) will display a “growth horizon”after the financial entity gave its approval to refinance Argentina’s debt for more than 44,000 million dollars.
“In a global context of uncertainty derived from the pandemic and armed conflicts, we reached this agreement that allows us to visualize a growth horizon. The international community has accompanied us.” The president said on his Twitter account.
“After two years of negotiations, we reached an agreement with the IMF which, after being approved in the National Congress, was approved today by the board of directors of that body”, Fernandez added.
The Argentine president pointed out that “This agreement does not take away rights. It does not promote labor or retirement reforms. Nor does it provide for structural reforms in the State”.
“We achieved this agreement, for the first time in history, with the approval of Congress and with the support of workers, businessmen, social organizations and governors of our country”he added.
The new understanding was approved by the two chambers of the Argentine Parliament thanks to the support of Together for Change, the main opposition front in Argentina, since the ruling party voted divided due to the fact that the sector that responds to the Argentine vice president, Cristina Fernandez has expressed its rejection of the agreement, alleging that it will imply a strong economic adjustment.
The agreement between the International Monetary Fund and Argentina It was finally sealed this Friday with the endorsement of the Executive Board of the financial entity, the last fringe that was pending.
The new program foresees total disbursements of some 45,000 million dollars so that Argentina can face the heavy maturities with the agency itself between this year and 2024 derived from the “stand by” agreement signed in 2018, during the Government of Mauricio Macri (2015-2019).
Fernández said that Macri took “The largest debt in history with the IMF and he carried it on the backs of generations of Argentines and Argentines”.
Among its main objectives, the new program seeks to attack the persistently high inflation of Argentina (50.9% in 2021) through a multiple strategy that implies a reduction in the monetary financing of the fiscal deficit and a new monetary policy framework, with positive real interest rates to support the financing of the Treasury through the domestic market .
It also establishes a gradual reduction of the primary fiscal deficit, from the equivalent of 3% of gross domestic product (GDP) in 2021, to 2.5% this year, 1.9% in 2023 and 0.9% in 2024, a goal that will force Argentina to reduce energy subsidies and increase tax collection, among other measures.