The IMF gives support to Milei and disburses 4.7 billion for Argentina

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Argentine Government receives $4.7 billion from IMF

This Wednesday, Argentina received a disbursement of $4.7 billion from the International Monetary Fund (IMF), as part of the debt payment plan that was renegotiated in 2022. The IMF executive board approved the quarterly goals of the debt payment plan, marking the first review of the plan under the new government led by Javier Milei.

According to the Minister of Economy, Luis Caputo, the disbursement is not new money, but rather part of the payment plan that was negotiated by the previous government. However, this disbursement is seen as a boost to the Milei Government.

The IMF’s support comes as Argentina grapples with economic challenges, including high inflation and a significant drop in GDP. The new government has promised to turn the 2023 fiscal deficit into a surplus and accumulate reserves of almost $10 billion.

This disbursement will be used to meet debt maturities with the IMF, with a portion of the funds going toward paying off debt in the coming months. However, Argentina still faces economic uncertainty, with the IMF predicting a 2.8% drop in GDP and annual inflation reaching around 150%.

The Argentine Congress is currently debating a megalaw, which includes deregulation of the economy, changes to the pension adjustment formula, and increases in taxes on federal imports. The debate over the law is ongoing, with Milei hoping to gain emergency legislative powers to implement his plan.

Despite the challenges, the IMF has commended the new government for taking bold steps to restore macroeconomic stability. However, the organization emphasized the need for continuous and lasting implementation of fiscal adjustment measures to secure future economic aid.

The disbursement from the IMF is a significant development for Argentina as the country continues to navigate economic challenges and work toward stabilizing its economy.