The Minister of Economy, Sergio Massa, arrives in Washington this Thursday morning to participate in the Assembly of the International Monetary Fund and the World Bank, but he will have to hold parallel
negotiations
to that of global finance to negotiate the next disbursement of the program, which it comes complicated.
At the end of the month, the agency's board of directors approved the fourth revision – which covered the last quarter of 2022 – and made the corresponding disbursement.
But the
staff report
came with
a series of alerts for the first quarter of this year
, especially due to the impact of the drought that drastically reduced the accumulation of reserves and for this reason the Fund agreed to reduce the target of funds in the Central (US $3,600 million at the end of March and 1,800 in all of 2023).
Still, it is estimated that this flexibility will not be enough to smoothly complete the fifth review.
The Fund has already warned: although there was condescension with the reserve objective, the deficit target (1.9% of GDP at the end of the year) will
not be relaxed
.
The minister needs to negotiate the greatest possible flexibility and at the same time
show that he is activating the measures that the Fund requests
: an acceleration of the removal of electricity subsidies for higher-income households;
a limit on the new retirement moratorium (it needs to reduce at least half of the 800,000 people planned) to cushion the impact on the deficit and a rearrangement in social subsidies.
Deputy Managing Director
Gita Gopinath
spoke about Argentina in an interview with
El País
from Madrid.
“It is a very difficult situation in which the country finds itself.
There is a shared understanding with the authorities that
even greater efforts are required
in order to have a good macro environment.
Being able to have a consistent fiscal policy, monetary policy, and exchange rate policy that can help reduce inflation and avoid major disruptions in the domestic bond market.”
Massa meets with Gopinath on Friday
to hone the details.
Meanwhile, the technical teams of the Fund and Economy work all week on the numbers.
Reserves are still scarce and Massa is juggling the “agro dollar”, but he needs more.
He knows that you have to "scratch the pot" from all sides to be able to raise funds and international organizations are the source that he has closest at hand and with the fastest disbursement.
And for that the Government had asked the United States for support on this issue when it was with President Alberto Fernández and Joe Biden at the White House at the end of March.
Before landing in the US capital, Massa made a stopover in Santo Domingo to meet
Wendy Sherman
, the US Deputy Secretary of State, who shortly afterwards continued on to Argentina, on a follow-up visit to the Fernández-Biden summit.
Before arriving in Washington DC, the Minister of Economy, Sergio Massa, held a working meeting in the Dominican Republic with Wendy Sherman, Vice Secretary of the Department of State of the United States and Ricardo Zúñiga, Under Secretary for Western Hemisphere Affairs.
Priorities for Argentina and the US were defined at the meeting. The official raised the interest in mining, food security, Chinese ports and the waterway.
Massa, for his part, put on the table the US agreement on tax benefits for companies that invest in mining and food in the US, which leaves out Argentine companies while the Government seeks to include them.
She also called for the resumption of the Generalized System of Preferences and demanded US support to obtain more financing from multilaterals.
The minister is looking for an additional US$3,000 in loans from the IDB,
the WB and the CAF because --although part of them are earmarked for infrastructure-- they come in dollars and serve to swell the reserves.
In Economy they want to take out the loans as quickly as possible.
Fernández asked Biden to help him before the organizations to achieve "a bridge" to cross the crisis situation and it is possible that this hand will materialize.
But it's not that easy, especially at the IDB.
According to what he reported in Buenos Aires
, President Ilan Goldfajn would be upset with the Government
because President Fernández and Foreign Minister Santiago Cafiero would have called the Brazilian by phone to pressure him to name Cecilia Todesca in a vice presidency.
When Argentina withdrew Todesca and supported Goldfajn's candidacy, from Economy they said that they would give Argentina a vice presidency and the management of a Gender direction.
But none of that has materialized yet.
Consulted by
Clarín,
the IDB declined to comment on it.
Foreign Ministry sources indicated that this information
“is false.
Neither Cafiero nor the President spoke with Goldfajn on the subject
”.
The Casa Rosada did not reply to this correspondent's query.
In this climate,
Massa will ask for the loans to be accelerated
and trusts in the guarantee of the US, a weighty partner in that organization and the World Bank.
Massa will have the IMF plenary session on Thursday,
a working breakfast at the Western Hemisphere Department
and several other meetings.
He will see Kristalina Georgieva in a meeting with other ministers from the region.
Beyond the IMF, he will also meet these days with Biden officials such as Michel Pyle, Deputy Director of the National Security Council of the White House, and with Juan González, special advisor for Latin America to the president, with whom he will review the bilateral strategic agenda .
Massa's agenda, which runs until Saturday, includes meetings with Mathias Cormann, OECD Secretary General, and José Antonio Ocampo, Colombian Finance Minister.
