Staff from an International Monetary Fund (IMF) mission are currently in Argentina for discussions regarding a potential new debt deal, as reported by a source from the economy ministry on Wednesday. The source confirmed recent remarks made by the IMF chief on encouraging conditions for the negotiations.
The government of Argentina aims to secure a new loan this year in addition to the one renegotiated by the previous administration in 2022. The expectation is that the additional funds could help further bolster market confidence in the country, given its status as the largest debtor nation to the IMF.
The undisclosed ministry source highlighted that Libertarian President Javier Milei's efforts to reduce public expenditure, rebuild foreign reserves, and tackle the high inflation rates have improved Argentina's chances of receiving additional financial support. Investors have reacted positively to these developments.
Speaking about the improving economic indicators in Argentina, IMF head Kristalina Georgieva mentioned that the "deficit wiped out, inflation down, and growth rebounding" create a favorable environment for continued dialogue. Georgieva made these remarks after a meeting with Milei's economic team in Washington.
A potential new debt agreement could potentially unlock fresh funds to reinforce the central bank's reserves of foreign currency.
Despite being away at the World Economic Forum in Davos, Switzerland, Economy Minister Luis Caputo has cut short his trip to return to Argentina for discussions with IMF representatives, as he announced on social media. Caputo noted that there will be intense discussions over the next few days involving the IMF mission, the recent membership bid announcement, and forthcoming measures being developed by the secretariat of commerce.