After the negotiations in Rome and the communication of the G20 countries in which they recommended to the IMF to analyze the policy of surcharges, Argentina has new options to maintain the negotiation and avoid falling into ‘default’. Amid optimism, President Alberto Fernández asked his US counterpart Joe Biden for flexibility to honor the debt “in terms and rates”
According to the Argentine newspaper ‘Ámbito Financiero’, which cites government sources related to the negotiation between Argentina and the International Monetary Fund (IMF), after the last round of talks the South American nation expanded its possibilities to avoid falling into defaults.
The communiqué issued by the G20 on October 31, in addition to recommending the policy of surcharges, asked the IMF to create a fund for the most vulnerable countries and gave Argentina a greater range of mobility with respect to its proposals to go paying the debt, which according to Fernández amounts to 57,000 million dollars.
Economy Minister Martín Guzmán, who remained in Rome until November 1, held a meeting with IMF representatives in which new alternatives for debt refinancing were analyzed.
Good meeting with the managing director of the IMF, @KGeorgieva, to advance in negotiations that allow us to leave the socially and economically unsustainable place where the government that preceded me left our beloved Argentina. To negotiate firmly is to regain sovereignty. pic.twitter.com/1ejZUHyQLy
– Alberto Fernández (@alferdez) October 30, 2021
Among the options that were put on the table, there is the possibility of a ‘standstill’ agreement, a pact between the debtor and the creditor in which the debtor is obliged not to fall into ‘default’ while the creditors are obliged not to undertake shares or require payments to the debtor until the completion of the negotiation and restructuring process.
At the moment, Argentina has been complying with payments required by the agency to avoid falling into ‘default’. On November 1, the Ministry of Economy announced about the payment of 390 million dollars as part of the interest. With this, Argentina reaches the payment of 2.47 billion dollars in interest and by next December they must pay another 1.88 billion more.
Fernández calls for greater “flexibility” to pay the debt
Protected by the optimism generated by the statement issued by the G20 countries, President Alberto Fernández, from Glasgow, once again asked the IMF for greater “flexibility” to pay the debt.
“Argentina is renegotiating a loan that was granted to my country for 57,000 million dollars. A sum greater than the one that the IMF allocated to all the countries of the world to combat the pandemic and that means half of the budget that the planet committed to address climate change and that still remains unfulfilled, ”said Fernández.
Additionally, the president added that “overcoming the obstacle that Argentina has in terms of external indebtedness with the IMF and doing so successfully, will accelerate the climate transition” in the country.
Despite optimism, on November 1 the country risk indicator was raised again to 1,728 basis points. This, according to experts, due to the uncertainty generated by reaching an agreement with the International Monetary Fund.
With EFE and Argentine media