The International Monetary Fund released on Thursday, again, a statement on the negotiations for the fifth revision of the agreement with Argentina. The Economy Ministry has maintained for many weeks, in off-screen conversations with its officials and also in statements by Minister Sergio Massa himself, that the agreement is practically ready for the credit agency to advance disbursements so that Argentina can pay the installments that are due in the remainder of the year without using BCRA reserves.
That optimism was belied, again and again, by the empire of reality itself, when the Central Bank verified, week after week, that the gyrations from Washington did not appear. Each of these delays was followed by new versions of economic officials, who disseminated plans to relaunch a new chapter of the soybean dollar and even the implementation of a new tax to tax imports of some products.
The IMF has already reluctantly accepted three editions of the soybean dollar. You can accept one more variant. On the other hand, it is very difficult for technicians to validate a generalized tax on imports that can later be questioned by other countries in forums such as the World Trade Organization, an entity that is dedicated, precisely, to settle conflicts over tariff barriers or for tariffs on free trade.
Economía now says that what Massa is proposing to the IMF this time is a special dollar for different agricultural products that does not include soybean exports. The minister was not happy with the result of the soybean dollar 3 and therefore does not want to replicate it once again. In turn, they are proposing to raise taxes on imports of luxury goods, a category that is already heavily taxed.
In Washington, they assured that the IMF and the Argentine envoys "continue to work constructively" and that the center of the discussion continues to be the failure to meet the Central Bank's reserve target and the cut in state spending.
IMF technicians intend for Argentina to join the list of countries that reached agreements in recent days. That idea runs into two pitfalls.
One is that there are six working days left in Washington before the start of the summer recess, a time when the U.S. capital becomes a ghost town.
The other is that Argentina is a middle-income country that is not willing to accommodate the goals that have already been met by the countries that have already signed, many of them with very meagre incomes. Burundi, Mozambique, Pakistan, Zambia or Congo – as Ezequiel Burgo reported in this newspaper – achieved successful renegotiations or revisions in these days. To do so, they lowered their fiscal deficits or removed exchange rate restrictions.
It is a difficult situation to manage for Massa, who in addition to being a minister is a presidential candidate. In recent weeks, candidate Massa spoke several times of his intention to detach himself from the IMF. He did so to accommodate his speech to that of the Union for the Fatherland campaign. That is why he has practically ruled out a trip to Washington to promote the signing of the agreement. That photo, which would be useful for the minister's need to calm the markets, would be inexplicable to the candidate who wants to represent Kirchner voters.