Argentina and the International Monetary Fund reached “understandings” on the goals and parameters that will underlie a proposed agreement to overhaul its $44 billion financing program.
Fund staff and teams from Argentina’s Economy Ministry and central bank “have completed the core aspects of the technical work of the next review,” the IMF said in a statement Sunday. A staff-level agreement “is expected to be finalized in the coming days to complete the review of the Argentina program.”
Argentina needs the money to repay previous debts owed to the Washington-based lender after a record drought cost the country $20 billion of agriculture exports. The government is running low on dollars, three months before a presidential election.
The newest version of the program refinances payments from a record bailout in 2018. Efforts to revamp the most recent accord began as spiraling inflation and a slowing economy left Argentina struggling to meet its terms.
Talks have dragged on for months as Economy Minister Sergio Massa, Argentina’s chief negotiator, emerged as the ruling coalition’s top presidential candidate in the election in October, pushing the deal further into the political spotlight.
Argentina owes the IMF $2.6 billion before July 31 and its not clear how it’ll make payment. In June, the government took the extraordinary step of paying part of an IMF maturity with Chinese yuan.
The IMF executive board usually takes two weeks from time of staff level agreement to vote on deal, meaning it’s unclear if the IMF disbursement to Argentina will be available before July 31 to make repayment back to IMF.
--With assistance from Scott Squires.
