The IMF will discuss this Friday the approval of the goals for the second and third quarters of the agreement
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the directory International Monetary Fund (IMF) will meet this Friday to debate the approval of the goals corresponding to the second and third quarter of the current program with Argentinaa unprecedented fact in the history of the organization and that, if approved, will allow a immediate disbursement of US$ 3,861 million for the country.
The novelty was announced this afternoon by the spokesperson for the Presidency, Gabriela Cerutiwho said that “for the first time in its history” the IMF will deal with the revision of two joint periods of the Extended Facilities Agreement (EFF) that it signed with Argentina, for which the Government hopes “to have the approval of the second and third quarters ” Of current year.
“We are confident in the approval of next Friday by the IMF and that the macroeconomic numbers allow us to continue on this path of order”Cerruti pointed out at a press conference at the Casa Rosada.
On the other hand, he argued that the disbursements scheduled by international organizations such as the Inter-American Development Bank (IDB) after the sealed pledge during the visit of the Minister of Economy, Serge Massato Washington and the currencies liquidated in the exchange market in September, will add 5,000 million dollars to the reserves.
“This allows us to exceed the reserve accumulation target for the third quarter,” Cerruti said.
Strictly speaking, Economy has already achieved the approval of the goals by the technical staff of the IMF, which led to the head of the organization, Kristalina Georgievto submit the report to the board for discussion.
At this Friday’s meeting, the directors will analyze the technical agreement reached between the agency’s staff and officials from the Ministry of Economy last September 19.
On that occasion, the IMF highlighted the Government’s commitment that “the key objectives established at the time of approval of the agreement (March 2022), including those related to the primary fiscal deficit and net international reserves, will remain unchanged until the end of the agreement.” of 2023″.
In this way, some 3,000 million SDRs, the IMF’s currency, will be disbursed, equivalent to some 3,861 million dollars based on the current price, explained by the depreciation of the currencies that make up the SDRs against the dollar due to the sharp rise in rates by the Federal Reserve in recent months.
Until a few days ago, it was thought that the third review would only be dealt with by the IMF board at the end of November or the beginning of December.
Massa (@SergioMassa) will attend the IMF Assembly and the G20 summithttps://t.co/ejqALP6rNZ
—Telam Agency (@TelamAgency) October 5, 2022
As established in the new program, the endorsement of the goals for the third quarter implies a disbursement of another US$ 5,800 million (4,500 million SDRs), although it is not confirmed that this disbursement will also be advanced after the approval of this Friday.
A part of these funds will be used to pay the maturities that the Argentina has with the IMF the program inherited from the management of Mauricio Macri, and the rest to reinforce the reserves of the Central Bank.
The approval of the goals was considered a key factor for the agency’s technical team, since “this approach provides a vital anchor to continue rebuilding credibility and sustain the renewed commitment to implement the program, around the pillars of the authorities referred to to the fiscal order and accumulation of reserves.
It was also highlighted that “most of the objectives of the quantitative program until the end of June 2022 were met, with the exception of the floor of net international reserves, mainly due to a growth in the volume of imports higher than programmed and delays in the support external official,” the IMF said in a statement, in an indirect reference to the delay of funds from other international organizations, such as the IDB.
The Minister of Economy, Sergio Massa, will travel to Washington next week to participate in the Annual Assembly of the IMF and the World Bank and the G2O Summit of Economy Ministers and Central Bank Presidents, accompanied by his adviser on international issues Gustavo Martínez Pandiani and his spokesman Santiago García Vázquez.
Massa will be accompanied by his technical team headed by the Vice Minister Gabriel Rubstein and will hold meetings with economic authorities from South America and Mexico organized by Ilan Goldfajn, Director of the Western Hemisphere Department of the IMF, as well as a bilateral working session with Gita GopinathDeputy Managing Director of the International Monetary Fund.
“The mission aims to consolidate support to continue advancing with the roadmap for the stabilization of the Argentine economy, strengthen reserves through more markets for national exports and promote more productive investments in strategic sectors, such as energy, gas, agribusiness , proteins, knowledge-based services and mining,” official sources explained to Télam.
Massa will arrive in the US capital next Wednesday the 12th, the day on which the G20 ministers’ meeting will take place, the last of the year before the Presidents’ Summit that will take place in Bali, Indonesia, in mid-November.
In this sense, there will be a closed meeting promoted by India, the country that will hold the presidency of the G20 next year.
Then, on Thursday the 13th and the following Friday, the Board of Governors of the IMF and the World Bank will meet, in addition to the meeting of the International Monetary and Financial Committee, as well as the activities within the framework of the Development Committee.
