First modification:
The Minister of Economy, Sergio Massa, assured that “Argentina will not use a single dollar of its reserves to pay the maturity of the debt” and, instead, explained that of the 2,700 million dollars that must be paid this Monday, August 31, , 1,000 million will come from a loan made by the Latin American Development Bank (CAF) and the remaining 1,700 million will be granted from the second tranche of the ‘swap’ in yuan that it has with the People’s Bank of China.
The Argentine Government will use any alternative available to it before disposing of its dollar reserves to pay its responsibilities with the International Monetary Fund (IMF). A premise that the Minister of Economy defended from the Palacio de Hacienda.
For the person in charge of the financial portfolio, Sergio Massa, this is the best option to avoid spending the few reserves of the greenback that the country has, while complying with the agreements made with the international lender.
“In this way, we protect the reserves in a year in which the worst drought in history worsened, costing us more than 20,000 million dollars of our exports for this year and more than 5,000 million in income for the national public sector as a consequence. of the taxes generated by these exports,” Massa explained.
Argentina will comply with its obligations to the IMF through agreements with China and @AgendaCAFwithout using a single dollar of their reserves.
❤️🇦🇷 #DefenderALaPatria “Our challenge is to continue taking care of the reserves, maintaining the level of activity and imports of goods… pic.twitter.com/oS8vFFuGJi
– José Arteaga (@joserarteaga) July 31, 2023
If the money does not leave the Argentine coffers, then who pays? Of the 2,700 million dollars that must be disbursed this Monday, the Government will take advantage of the yuan agreement with China and will use the second tranche of the ‘swap’ to deliver USD 1,700 million to the IMF. A transaction that will be made directly from the People’s Bank of China to the international lender.
The remaining USD 1,000 million comes from another loan, one that it made with the Latin American Development Bank (CAF), approved by 20 of 21 members with the aim of helping the South American country not to default on its responsibilities.
Massa: “Argentina must live with this debt”
While trying to make good with the IMF, the Argentine people must deal with a high cost of living that puts pressure on their pockets.
Argentina: Homeowners try to beat inflation with dollar rates
In June, annual inflation stood at 115.6% from 114.2% year-on-year in May, being the eleventh consecutive month of an increase in the rate. This has been established as the highest level since 1991 and places the country as the second with hyperinflation in the region, after Venezuela.
“The agreement with the Fund is probably the worst inheritance of the previous government, basically because it is a debt that is neither on roads nor in schools, nor in hospitals, nor in any improvement, neither for companies nor for Argentine families, It ended up being a program that only served to finance the outflow of capital,” said Massa, who is also a presidential candidate for the pro-government Union for the Homeland alliance.
With AFP and EFE.
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