Javier Milei confirms meeting with the IMF to renegotiate debt maturities

The Argentine president, Javier Milei, confirmed this Sunday that “starts tomorrow (Monday)”he meeting with the high-level delegation of the International Monetary Fund (IMF) for the renegotiation of debt maturities after technical conversations over the weekend with his economic team, which delayed the meeting.

“They start tomorrow. “I’m not necessarily going to be there tomorrow.”said the president in statements to Radio Miter, one day after arriving in Buenos Aires from the Marambio Base in Antarctica, to begin an environmental project to monitor marine pollution.

Reaching an agreement on the renegotiation of the debt maturities that Argentina maintains with the IMF is the main objective of the first meeting of the Javier Milei era between representatives of the new Argentine Government and a high-level delegation of the multilateral financial organization.

The Minister of Economy, Luis Caputo and the Chief of the Cabinet of Ministers, Nicolás Posse, will lead the first meeting with the intention of postponing the first maturities of this year, which will be met on January 9 and 16, which amount to US$ 1,300 million and US$650 million, respectively.

The meeting had originally been announced for last Thursday, but was postponed until this Monday so that technical meetings could be held between the Fund and the teams of the Central Bank of Argentina and the Ministry of Economy.

For its part, the Fund will aim for the country to unify payments and this is only possible if there is more than one maturity in the same period, something that was done in June, July and October of last year, during the Government of Alberto Fernández ( 2019-2023).

The refinancing agreement signed in March 2022 amounted to US$ 43,491 million at the end of the third quarter of last year, with an increase of 3,271 million compared to the second quarter.

On the other hand, the Argentine Head of State stated that he expects a disbursement from the IMF to have “more flexible macroeconomic management, which would allow a more forceful (economic) stabilization program to be put together.”

In this sense, Milei was forced, after the presidential transition last December, to resort to a short-term loan from the Development Bank of Latin America CAF for US$ 960 million to pay the December 21 maturities.

Ultimately, the IMF has supported the measures of the new Argentine Government, which aim at fiscal adjustment, cutting public spending and curbing monetary issuance.

In fact, some analysts predict that the libertarian president’s economic program goes further than what the agency requests to comply with debt service.

“These strong initial actions aim to significantly improve public finances in a way that protects the most vulnerable in society and to strengthen the exchange rate regime.””, remarked the Director of Communications of the IMF, Julie Kozack, after learning of the first economic announcements, in mid-December.

In addition, the managing director of the IMF herself, Kristalina Georgieva, gave her support to the package of measures that aim to eliminate the fiscal deficit and achieve a primary surplus that allows servicing the debt in foreign currency.