2023-07-21 23:58:03
The fifth revision quarterly of Extended Fund Facility (EFF) has the date of due July 28 and the minister Sergio Massa is willing to exhaust the negotiation times and obtain the approval of this technical report, given the impossibility of reaching an agreement to recalibrate the entire program. By sticking to this scheme, Argentina would receive the USD4,000 million that should have entered in June, and would postpone the reshaping of macro fundamentals until endorsement by the Board of the International Monetary Fund. That agreement will need it, sooner or later, to go through the worst moment of exchange tension, which is expected in the month of the October general elections.
With that amount, the Government could face the USD2,700 million that matures on July 31, plus the USD800 million of interest which must be paid on the first day of August. Only USD500 million would remain available to meet commercial obligations and to put out some exchange fire. That is why an express renewal of the swap with china to be able to have the second stage of the USD10,000 million agreed in Beijing, in order to allocate the use of yuan to sustain the activity.
The Government rushes the decrees to obtain dollars, while the negotiations with the IMF are delayed
“Everyone believes that the negotiation is about a program and, in reality, it is for the fifth revision. The deadline for approval of the staff-level agreement It’s July 28,” he clarified to PROFILE a privileged source who actively participates in talks with the International Monetary Fund. That remark revealed that the ambitions of obtaining a minimum advance of USD 7,400 million were left behind, which also included disbursements of USD3.4 billion in September. That move would have meant carrying post elections the total renegotiation, kicking even the sixth revision. The maximum ambition was to freeze all of 2023 and part of next year, pending a recovery in agricultural exports. That alternative was banished.
The analysis of the fifth revision of the program
Therefore, in these hours the officials who make up the delegation in Washington discuss the waivers necessary to be able to overcome the almost total non-compliance with the goals established in the original agreement to repay the foreign debt. The effect of the drought recognized by the IMF paved the pardons that must be interposed so that, finally, the disbursements allow to prop up the maturities. The collection dropfrom the collapse of agricultural exports, generated a tax hole. She also left bare problems of the Central Bank to accumulate reserves. In that context, the Monetary issue remained high and ended the second semester at $670,000 million, almost double the original goal.
Massa followed the maxim that his current Secretary of Industry and then head of the Argentine Industrial Union knew how to use, Jose Ignacio De Mendigurenwhen in 2011 he recommended overheating investment to avoid cooling the economy. Before the claim of devaluation and restrictions on imports, made by the IMF In a harsh report that warned of the low accumulation of dollars in the Central Bank’s coffers, the head of the Palace of Finance drew up a package of measures to encourage exports and discourageat least for the time of the campaign, the contracting services and luxury goods. But if they materialize, the collection of the extra cost will allow the cash to be increased to prop up the State’s investments in economic activity.
Dollar today: pending the agreement with the IMF, the blue touched another historic mark and closed at $528
The also presidential candidate knows that The agreement with the IMF is essential to hold down the market variables that may impact prices. After all, the street agenda is inflation and the ability of salaries to make ends meet. For this, he put his entire team to work on measures that will not end the foreign trade sector, but the urgency was to show the Fund that it was advancing with its own recipe to achieve the objective set for the new agreement: increase the reserves of the BCRA to take care of the dollars that the organism will disburse in the next days.
The candidate Massa visits the Rural exhibition
Massa’s schedule until Thursday night included a trip to Washington to seal the deal with the IMF. With decrees involved to hunt more dollars, but without the final OK from the Fund, the minister will postpone the visit to the United States and will become a candidate to go through the discussion table organized by the Argentine Rural Society (SRA) at the 135th exhibition in Palermo. It will reach hostile ground, because from the countryside there was criticism of the renewal of the agricultural dollar; but also generated expectation participation, unprecedented among candidates allied to Kirchnerism since the crisis broke out by resolution 125 of 2008which initiated the rupture between Peronism K and its allies with the countryside.
Alberto Fernández revealed a dialogue with Georgieva to speed up negotiations with the IMF
The conclave of the Rural It will start next Monday at 9:30 a.m. with the presence of the Libertad Avanza candidate, Javier Miley; then he will go on stage Patricia Bullrich. She will be succeeded by the Cordovan governor Juan Schiaretti; and later it will be the turn of the Buenos Aires head of government, Horacio Rodriguez Larreta. The closure will be in charge of Massastepping on the Palermo midday, which will have its 15 minutes of presentation and then you will face another ten minutes of questions. Curiously, in that audience, the Unión por la Patria candidate will present for the first time his package of measures to help the BCRA’s reserves, with a wink included to the IMF.
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