The International Monetary Fund (IMF) has issued an endorsement of the economic reform programme presented by Argentina's government as part of negotiations for a new loan. However, while the IMF appears pleased with the proposed reforms, president Mauricio Macri has faced increased protest at home with a growing number of citizens taking to the streets against his economic policies.
Christine Lagarde, managing director of the IMF, stressed: “This will be Argentina's economic program, one that has full ownership of President Macri and his government.”
According to Lagarde, the program would “protect society’s most vulnerable during this transition.”
However, until now Macri’s reforms have only benefited the wealthy and produced a widespread uproar. After decreeing a tax cut for agri-businesses and eliminating currency exchange controls, Macri’s government has slashed pensions, promoted layoffs in the public sector, and increased public services’ tariffs.
These policies generated widespread protests by unions, students, human rights advocates, and other social sectors who protested against the social cost of economic decisions. However, Lagarde said Friday “financial vulnerabilities” are a consequence of the slow pace of economic adjustment.
Many Argentines are weary of Macri’s decision to go to the IMF after a run on the currency destroyed about a fifth of the peso’s value in recent weeks. Their concern is related to the 2001-2002 economic crisis that many believe was a direct consequence of applying IMF-sanctioned structural adjustment policies, including free-trade, financial markets liberalization, and social spending cuts.
On Thursday Argentine social movements and opposition political parties marched to reject IMF negotiations.
Vilma Ripoll, leader of the Socialist Workers’ Movement, told Reuter “ we want to come to the street to denounce the adjustment and the policies of Macri's government, aggravated by calling the IMF."
The 2001-2002 crisis left millions in poverty. Since then, the progressive government of Nestor Kirchner paid the country’s debt with the IMF in full and cut all ties with the financial institution.