Inflation of almost 200 percent
Argentina receives billions in loan from the IMF
January 11, 2024, 11:57 a.m
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Argentina has been suffering from a severe economic crisis for years – the IMF is supporting the country with loans. In return, however, there are reform requirements. Both sides have now been able to agree on a new package of measures.
The International Monetary Fund (IMF) and the new Argentine government have reached an agreement on details of the $44 billion aid program. “A strengthened package of measures has been agreed to restore macroeconomic stability and get the current program back on track,” the IMF said.
The Executive Board of the Washington-based financial organization could now give the green light for the disbursement of a partial loan of $4.7 billion in the coming weeks. In order to grant individual tranches, the South American country, which is suffering from a severe economic crisis, must show that it is complying with the reform requirements required by the IMF.
Argentina had to revise its IMF agreement after the previous government missed several economic targets associated with the program. The government of new President Javier Milei, who was sworn in in December, had been holding talks with IMF representatives in Buenos Aires since last week to secure the seventh review of the loan program and new funds to pay off debt. Argentina is suffering from a chronic economic crisis, rising poverty and massive inflation of almost 200 percent.
The right-wing populist and economist Milei, who describes himself as an anarcho-capitalist, announced a radical restructuring of his country during the election campaign. This should include, among other things, drastic spending cuts and the abolition of the national currency, the peso, in favor of a peg to the US dollar. Milei is strongly opposed to abortion, supports looser gun laws and has repeatedly criticized Argentina’s Pope Francis. Argentina is the IMF’s largest debtor.
New Economy Minister Luis Caputo said the agreement with the IMF was not a new deal. However, the IMF has shown itself to be open to a new program to make additional funds available.