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Negotiation delayed and Sergio Massa postpones trip to IMF

2023-06-08T02:22:12.176Z

Highlights: The minister was due to travel around June 20. 'They're not going to run my bow.' The IMF will hold a press conference on Thursday. With two weeks to go before the maturity of US$ 2.700 billion, the government delayed the trip to Washington and conditioned it to the closure of virtual negotiations with the IMF. In that way, the calendar of the Argentine mission was stretched again and Economy Minister Sergio Massa is expected to travel closer to June 20, sources say. The Fund also has its eyes set, according to Massa's team, on the mega debt swap.


The minister was due to travel around June 20. 'They're not going to run my bow.' The IMF will hold a press conference on Thursday.


With two weeks to go before the maturity of US$ 2.700 billion, the government delayed the trip to Washington and conditioned it to the closure of virtual negotiations with the IMF that it has been carrying out from Buenos Aires. In that way, the calendar of the Argentine mission was stretched again and Economy Minister Sergio Massa is expected to travel closer to June 20.

From China, the government had announced last Friday that the minister will travel in "10 days" to the US, after the arrival of its technicians. Now, it is expected to do so on the 20th or 21st, after the inauguration of the Néstor Kirchner gas pipeline in Vaca muerta. "There are more negotiations, there are days that are better, other days that are more tense, but they are logical (things)," close sources said.

In the midst of the zoom led by Leonardo Madcur and Gabriel Rubinstein, the expectation is that the spokeswoman, Julie Kozack, will announce at the traditional IMF press conference on Thursday, the schedule of work with Argentina. This is the closing date of the staff level agreement, the board meeting and the publication of the staff report. Kozack will speak Thursday.

Massa wants to make sure that the bulk of the negotiations are closed before sending a delegation to Washington and thus avoid the officials being taken hostage. "The team travels when we close virtually successfully, that you travel and they begin to run the bow, with me it does not go," was the order that the minister lowered, according to his portfolio.

On June 21, US$ 900 million expires and on June 22, US$ 1,700 million. Massa is considering early cancellation of the first with remaining special drawing rights (SDRs), which would be around US $ 1.600 billion, according to private calculations. And the remaining amount would be paid after the scheduled date, since "in the last two years it was done a lot of times."

In view of the deterioration of the goals evaluated by the Fund (net reserves, primary deficit and monetary issuance), Massa began negotiating two months ago a new flexibility of the program and an advance of disbursements of up to US $ 10,000 million from 2023. As the talks dragged on and a $4 billion disbursement was already planned in June, the advance could actually be $000 billion.

In the Treasury, they affirm that spending continues to be kept "at bay" and that "hard" spending, such as pensions, will not resign it, despite the fact that in April they had a real fall of 15% year-on-year by growing below an inflation of 108.8%. In this context, the diagnosis is that "the goals are not the same" due to the collapse of export duties, the "engine" of collection.

The Fund also has its eyes set, according to Massa's team, on the mega debt swap in pesos called for this Thursday. The minister is betting on renewing at least 50% of the $ 9.2 billion that matures between June and September, a goal that would apparently be acceptable to the body. "It is difficult but we hope to overcome that percentage, which would be a success, they say in Economy.

Announcements

Massa was talking this afternoon with the President, Alberto Fernández, at Casa Rosada about the status of negotiations with the Fund, the renewal for three years of the swap in China and a set of economic announcements, such as the increase to $ 880,000 of the amount of gross salaries exempt from the bonus of the payment of Earnings.

The package includes a 41% increase in the scales of the monotributo and credits at subsidized rates of 43% for two years. It is a new line for the purchase of equipment and tools for microenterprises of monotributistas, which aims at a universe of 1.4 million people. The two measures will be announced this Thursday at the Expo Escobar.

Benefits will also be given to automakers for investments,

The announcements are mostly aimed at offsetting the effects of accelerating inflation. Massa now expects inflation in line with the City's path, which in May fell to 7.5% monthly. But he does not want to make "twice the same mistake" of announcing a goal that is not met.

At the end of 2022, it forecast inflation in April "with a 3 ahead", which ended at 8.4%. For May, consultants expect a CPI close to 9%, although some acknowledge that they could have exceeded. The data will be known on Wednesday, June 14. In his team they believe that society has already "naturalized" the rise in prices and assure that the priority is the "stability" of the economy.

Source: clarin

All business articles on 2023-06-08

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