Argentina opens talks with IMF over rescheduling debt

Argentina formally opened consultations with the International Monetary Fund (IMF) on Wednesday, August 26, to agree new terms on the repayment of a $57-billion bailout agreed in 2018.

President Alberto Fernandez had spoken with IMF chief Kristalina Georgieva “to begin negotiations aimed at reaching a new understanding with the organization,” Fernandez’s office said in a statement.

In a statement released by the IMF, Georgieva said Fernandez “notified me of the request by his government to start discussions on a new IMF-supported program.”

After talks she described as “very constructive and positive”, she said “we stand ready to play our role.”

“We look forward to deepening our dialogue on how we can best support the government’s efforts to manage the impact of the pandemic, jumpstart growth and job creation, and reduce poverty and unemployment while strengthening macroeconomic stability for the benefit of all Argentines.”

Fernandez told Georgieva of the need “to work together with the IMF to sort out the disorder that we inherited from the previous government” of his liberal predecessor Mauricio Macri.

Fernandez put repayments to the Washington-based lender on hold and renounced outstanding tranches of the bailout when he assumed the presidency last December, saying Argentina already had enough debt.

Argentina “to a great extent, has already put its accounts in order with its creditors and will start working today to do so with the international credit organizations, especially the IMF,” the center-left president said.

Earlier this month, Fernandez’s government reached a deal with 3 major creditor groups to restructure a $66-billion debt after months of strained negotiations and missed deadlines.

The bonds represent roughly a fifth of the country’s $324-billion debt, which amounts to around 90% of its gross domestic product. – Rappler.com