Argentina’s Congress has approved a new IMF loan for President Javier Milei to bolster foreign currency reserves and manage upcoming debt repayments. The vote, which shows Milei’s coalition-building efforts, comes amidst public protests against austerity measures. With inflation reduction claims, the new loan seeks to stabilize the economy and is viewed as a pivotal step for the country, which has a historical dependency on IMF bailouts.
Argentina’s Congress has approved President Javier Milei’s request to negotiate a new loan with the International Monetary Fund (IMF). This agreement will complement the existing $44 billion debt owed. The new loan is aimed at bolstering the central bank’s foreign currency reserves and addressing upcoming debt obligations. Specific details of the loan amount remain undisclosed, positioning it as a critical move for Argentina, which has faced multiple IMF bailouts historically.
Following Milei’s submission on March 11, Congress required approval, with the lower house, known as the Chamber of Deputies, voting in favor by 129 votes to 108, alongside six abstentions. While Milei’s libertarian party holds a minority, it has successfully formed coalitions to support its financial strategies. This particular vote occurred amidst considerable public dissent related to Milei’s stringent austerity measures and the broader implications of engaging with the IMF.
Amidst protests, a demonstrator expressed concern, stating, “Every time something is agreed with the IMF, things get worse for us.” Following tensions between protesters and law enforcement, security Minister Patricia Bullrich noted that the security measures deployed, comprising around 2,000 officers, were effective despite minor incidents during the demonstration.
Milei maintains that securing this new loan is essential for repaying central bank debts and combating the severe inflation issues plaguing Argentina. The country currently experiences one of the highest inflation rates globally. Since his appointment, there has been a notable reduction in inflation rates from 211% at the end of 2023 to 66%.
Negotiations for a new “extended fund facility” (EFF) with the IMF began in November to supersede an earlier agreement made in 2022, easing the burden of the $44 billion debt incurred during President Mauricio Macri’s administration in 2018, which represents the largest loan ever issued by the IMF.
In summary, President Javier Milei has secured Congressional approval to negotiate a new IMF loan aimed at addressing Argentina’s significant financial challenges. Despite facing public protests regarding austerity measures and the implications of IMF agreements, Milei asserts that the loan is crucial for stabilizing the economy and reducing inflation. The ongoing negotiations for the extended fund facility highlight Argentina’s ongoing dependency on international financial assistance amidst a turbulent economic landscape.
Original Source: www.rfi.fr
