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The IMF's key mission begins to define the goals of the new loan

2020-11-09T00:38:49.318Z


Julie Kozack and Luis Cubeddu arrive along with a team of economists, and this Tuesday they are already meeting with Martín Guzmán. After the negotiation, the Government will send the multi-year plan to Congress.


Mary Church

11/08/2020 18:59

  • Clarín.com

  • Economy

Updated 11/08/2020 7:33 PM

The second mission of the

International Monetary Fund

arrives this Tuesday in Buenos Aires, to work fully on what will be the main guidelines of a

new loan

with Argentina, to get the dollars

to

repay the previous one

.

As soon as the team led by

Julie Kozack

, who is number two in the Department of the Western Hemisphere, and

Luis Cubeddu

, who heads the staff that closely follows the Argentine case, arrives with the rounds at the Ministry of Economy and will work together with the Minister of Economy,

Martín Guzmán

.

Unlike the trip they made in early October, this time Kozack and Cubeddu will not be alone: ​​a team of

6 or 7 economists from the IMF technical team will

accompany them.

The intention is to advance as much as possible in the design of the new program to

refinance the payments of US $ 44,000 million

that are owed on the loan received between 2018 and 2019, during the government of

Mauricio Macri,

and, if necessary, receive some

additional dollars .

In the meetings of the next

almost two weeks

(which is the time that the IMF envoys will be in Buenos Aires), progress will be made on the specific guidelines of the program:

fiscal objectives

will be defined

, for example, which will be part of the multi-year goals that Guzmán will send to

Congress

and he wants them to be dealt with

before the end of the year

.

Discussions with the Fund will not only be about tax matters.

The

exchange gap

between the official dollar and the parallels (partially cut) worries the organization.

More structural issues will also be covered, an IMF spokesperson said.

"The dialogue will focus on the authorities' fiscal, monetary and structural agenda for the medium term in order to anchor macroeconomic stability and lay the foundations for

inclusive and sustainable growth

," he specified.

Once the most important aspects are closed, the Executive will also turn

the bill that gives legislative support

to the negotiation with the IMF.

According to official sources, it still remains to define what the level of detail will be that rule will have: if it will cover characteristics that are part of the program or if it will be an authorization for Guzmán to negotiate with the agency.

“After the debt restructuring, something more profound is coming, which is the definition of a

multi-year program

to

put in order and stabilize

the Argentine economy.

The context in which negotiations are being carried out with the IMF is an opportunity for all of us to agree on fundamental pillars for stability ”, said Guzmán last Friday when he visited the Toyota plant in Zárate.

The government was happy after the IMF mission that took place at the beginning of October: they felt that in those days more progress was made than expected.

Although they prefer to be cautious now about what will be the result of the exchanges that begin this Tuesday, in some private meetings the Government slides that the closing of the agreement could occur at the

end of this year or early 2021

.

Until now, publicly, the officials of the economic team maintain that the important thing is to have it by May 2021: that month,

US $ 2,100 million will

expire

with the Paris Club,

which the Government also seeks to renegotiate (this group of countries demands to have an ongoing program with the IMF to do so).

The intention of some officials is that the program with the IMF serves as another sign of

greater fiscal and monetary moderation

, a path that Guzmán has undertaken with more force in the last week.

However, others doubt if, even with a plan with established goals, it can work.

"With the previous government they had all the numbers and even so they

crashed the merry-go-round,

" some said

quietly

.

In full negotiation with the IMF, the elections in the United States that lead

Joe Biden

to the presidency

are not innocuous

: it is that once the type of loan that Argentina could access has been designed, it must be approved by the board of the international organization.

Within this directory, the main weight

falls on the US

: with

16%

, the representative of that country before the IMF board is the one with the greatest power.

The reading made by some officials of the Alberto Fernández government is that the United States will seek to play a role

as neutral as possible

in the negotiation: without playing for but not against, after having supported the largest loan disbursed for a country, which was the one that Argentina received between 2018 and 2019.

Even so, the eyes are still attentive to who may be the person who has a key figure: that of the

secretary of the US Treasury

Although the possibility of

Larry Fink

(CEO of the

BlackRock

fund

) had flown over the last few months as possible treasurer, with Biden the winner, those of

Lael Brainard, Gina Raimondo or Elizabeth Warren

are sounding more

.

Guzmán exhibits at the UNI Global Union

Before the arrival of the IMF technicians, Martín Guzmán will start the week with some definitions in the

UNI Global Union

.

It is an international meeting together with the former Prime Minister of Italy,

Enrico Letta,

to discuss the global role of finance in the post-pandemic economic recovery and the role of trade unions.

Under the title "Ensuring sustainable financial systems," Guzmán will speak at this virtual meeting between 11am and 12.30pm on Monday.

The seminar is organized by UNI Global Union, a global union space representing some 20 million workers.

Source: clarin

All business articles on 2020-11-09

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