Economy Minister Sergio Massa, started the US tour with strong support of the Inter-American Development Bank (IDB), and this will allow him to enter all the doors he will knock on in this city with officials from the White House, the State Department, the Treasury, the World Bank and the Monetary Fund, among others.
This backing from the IDB, which implied a 180-degree change in the relationship that the organization had been having with previous efforts, will mean an entry of 1,200 million dollars freely available by the end of the year, which would be used to strengthen the reserves and, on the other hand, more funds for investment credits for works in the Province of Buenos Aires and Tourism.
This was something that was already valued on Tuesday by the IMF staff in pursuit of compliance with the agreement, according to members of the Argentine economic team transmitted to Massa who are conducting the second review of the program with the Fund.
“There was a surprise from the Fund, which valued the new agreement with the IDB,” it was commented in the US capital.
This agreement is added to the recent measure of the dollar-soybeans at $200 pesos that allowed in less than two days to reach a grain settlement of 1,750,000 tons, as much as what was settled throughout August.
“Massa came to maintain in each place of his institutional visit in Washington that Argentina will meet the goal of the agreement with the IMF of a fiscal deficit of 2.5%, and the result achieved with the IDB strengthens Argentina’s position in this regard”celebrated from the surroundings of Massa.
The political relationships that Massa has been cultivating over the last 20 years are being put to the test on this tour
That is, next Monday Massa will meet with the head of the Fund, Kristalina Georgieva, and also with the right hand of the head of the Treasury, Yanet Yellen, David Liptonwhere he will reiterate Argentina’s position on how it will be done to meet the IMF’s fiscal goal, just as his predecessors Martín Guzmán and Silvina Batakis did, and the same line will be maintained, sources close to Massa indicated.
In fact, Batakis will travel to Washington to accompany the Economy Minister in his meeting next Monday, although the environment is very different: the exchange rate gap has dropped to the lowest level in two months, less than 100%, and measures have been taken to guarantee the fiscal order and the non-issuance of the Central Bank to assist the Treasury.
Regarding the sources of reserves, something that the economic team ruled out here is that “the IMF will not be asked for the 1.3 billion dollars that would correspond to the country with the new IMF Resilience Fund, approved during the pandemic, because It would be operational until 2024 and 2025,” they indicated.
Massa does not rule out requesting funds through the Repo, and even organizations such as the IDB may participate by providing guarantees
Nevertheless, Massa does not rule out requesting funds through the Repoand even organizations such as the IDB may participate by providing guarantees to obtain loans from private banks.
“That would be in October,” they indicated, and perhaps it will take place within the framework of the Annual Assembly of the IMF and the World Bank, realizing that in the long run “Massa is complying with the checklist of measures that he announced when he took office,” just a month of management.
The political relationships that Massa has been cultivating for the past 20 years are being put to the test on this tour: I knew Mauricio Claver-Carone when he had been the IMF representative in the Donald Trump era.
She has also known Juan González for about six or seven years, and was introduced by the Undersecretary for the Western Hemisphere of the Department of State, Ricardo Zuñiga, although they were all in different capacities, they continued to maintain the relationship, which today becomes very relevant for the bilateral exchange of the government of Alberto Fernández.
The Wall Street investment funds, although they were neither the main course nor the dessert of this tour, he has known them since he was the head of Anses, and also when he held the mandate to negotiate the Argentine debt, before Amado Boudou .
Here in Washington they are aware that Massa was the one who sought to mediate with the opposition to close an agreement with the IMF.
One quality of Massa is that he is seen as a pragmatist; “He can speak perfectly with a Democrat, or with a Republican, without introducing the ideological component and that is liked in Washington,” said a source who follows him every step of the way.
At dinner on Tuesday night with Joe Biden’s special adviser, Juan González, and US Ambassador Marc Stanley -at Ambassador Jorge Argüello’s house-, Massa was able to exchange first-hand and in a more relaxed atmosphere the thermometer of the bilateral relationship between the United States and Argentina, and “exchange messages” to strengthen the bilateral relationship, in addition to sharing Mendoza wine and exchanging soccer. Both are from Tigre, something else that weighs on mutual understanding.
