The Minister of Economy
Luis Caputo
arrived in Washington this Wednesday to participate in the Spring Assembly of the International Monetary Fund and began his activity with a meeting with investors interested in Argentina, while preparing tomorrow, together with the Chief of Staff Nicolás Posse, for meetings at the IMF, the Treasury and the White House.
The minister was cautious about general expectations of his visit. “Not many,” he told
Clarín
briefly, as he entered a meeting at the JPMorgan hotel. In addition to the protocol meetings within the framework of the Assembly and the G20, Caputo has to continue the conversations on the eighth review of the program with the IMF, which should close in mid-May.
The fiscal deficit, monetary financing and reserve goals have been met, so it is estimated that the review will be passed without problems. But the Government is seeking the IMF to disburse more money (there is talk of US$15 billion) to be able to get out of the trap with more room for maneuver. The organization for now does not seem too predisposed: “It is premature” to talk about it, spokesperson Julie Kozack said weeks ago.
Although neither the Fund nor the Government officially confirmed a meeting, it is estimated that Caputo will meet these days with Kristalina Georgieva or Gita Gopinath, the organization's number two, to continue the conversations. Gopinath was in Buenos Aires weeks ago and is immersed in the Argentine case.
Caputo and Posse landed somewhat late in the US capital and the head of Economy
went directly to a meeting organized at the Park Hyatt hotel by JPMorgan.
It is common for banks and consulting firms to organize different forums in parallel during the IMF Assembly, taking advantage of the number of ministers from around the world who come to visit.
Caputo's dissertation was on “Stabilization, Deregulation, and Sustained Growth.” As
Clarín
learned
from sources who participated in the meeting, “the investors' impression was good.” The minister made a brief presentation, said that he had never seen a president with such commitment to fiscal balance and then those present asked him several questions.
Some revolved around the dollar. She wanted to know if the crawling peg was going to continue at that level and if it would become overvalued. Caputo answered that they had studied the historical balance and that in times of stability the dollar would be at values equivalent to 550 pesos and in periods of crisis to 1300. He said that the exchange rate was not a problem today, that they will float it and see how reaction to.
Regarding the stocks, he said that they are going to leave "as soon as they can", without
setting specific dates, although he said that it was important to receive an extra injection from the Fund.
He was also asked about the adjustment and what would happen later and he said that there would be more resources because the Bases law would reinstate Profits. Another issue that investors pointed out was political support for the law, and they were optimistic because
“it is a project that has been negotiated.”
When the minister was asked about which sector will generate Argentine growth, he only said that Milei was a very important media phenomenon and that he observes “the interest it arouses among businessmen who want to invest in Argentina.”
The
Institute of International Finance
(IFF), an expert consultancy in the financial industry, organized another meeting at the Willard Hotel where the Argentine case was discussed.
Martín Castellano,
head of Latam Research at the firm, has just returned from Argentina where he took a group of investors. They saw government officials, representatives of the private sector, political and economic analysts.
After the trip, “the feeling that remained was one of moderate optimism,” he told C
Clarín.
One of the aspects that businessmen valued was Milei's popular support. “This was an administration that took office with fairly weak legislative support compared to others and it was a positive surprise to find that popular support was still significant.”
However, Castellanos warned that “one of the main points being looked at now is political support, beyond the popular support.”
“I think that now the Government has to score a political victory in April or May
,” in relation to the approval of the Bases law. “They would be the strongest signals that the market would receive very well and I think they would also be very well received by the organizations here in Washington,” said the expert.
Of course, the doubts always remain: “Investors know Argentina and know how they have performed in recent years.” "But that there are proposals that favor private investment, that there is a stabilization plan, a clear policy to reduce inflation, the fiscal deficit, I think are already highly valued advances."
Caputo and Posse
will visit the Treasury this Thursday,
where they will meet with Jay Shambaugh, Janet Yellen's right-hand man, who was in Buenos Aires in December and is closely following the Argentine case. Washington is closely watching the evolution of Argentina's economic plan. The role of the Treasury is fundamental for any negotiation or new program with the Fund, since the United States is the organization's main shareholder and its vote has more weight than any other country on the executive board.
The Argentines will also go to the White House to meet with the new Security Advisor for Latin America,
Dan Erikson,
who replaced Juan González days ago. He will also meet with Deputy National Security Advisor for Cyber and Emerging Technology, Anne Neuberger.