Argentina must pay this Monday (31) maturities with the International Monetary Fund (IMF) in the amount of US$ 2.7 billion through a short-term loan from the Development Bank of Latin America (CAF) and yuan from of a foreign exchange swap agreement with China.
The information was released this morning by the Argentine Economy Minister, Sergio Massa, who recorded a message before the opening of the markets, to try to reduce the “uncertainty” about payments in the Latin American country, since Argentina’s net reserves are negative.
Massa thanked CAF and the countries of the multilateral organization that approved a bridge loan of US$ 1 billion until the conclusion of the IMF disbursement at the end of August, according to the technical agreement reached last Friday (28), as well as the People’s Bank of China and the government for allowing a second tranche of the yuan swap.
Argentina renewed and expanded the currency exchange with China in June, up to the equivalent of US$ 10 billion, as confirmed today by the Minister of Economy, money that will be used to pay the US$ 1.7 billion to the IMF.
“Argentina will not use a single dollar of its reserves” to pay this Monday’s salary, assured Massa.
Argentina’s net reserves are negative at around US$ 8 billion, according to private economists, due to the shortage of foreign exchange, which is the result of strong macroeconomic imbalances aggravated by a historic drought that caused the collapse of agricultural exports in the country.
Argentina and the IMF reached a technical agreement on the revision of the objectives and targets of the agreement to refinance the debt of US$ 45 billion contracted in 2018 by the South American country with the organization.
With the new review, which must now be ratified by the Fund’s Board of Executive Directors, Argentina will receive a disbursement of US$7.5 billion after the August 13 primary elections, and the next review will take place in November, after the presidential elections.
Until the meeting of the IMF board of directors, the Executive must apply a sequence of policies or additional actions.
This week’s total maturity amounts to about $3.4 billion with the IMF.
Argentina had already paid the June maturity with the IMF with its own resources, in a combination of special working rights and the use of a yuan swap with China.
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