President Mauricio Macri said the IMF would come next week, but fund officials are making a weekend visit to the nation that has a $US56.7 billion loan, and can't get out of debt.
Members of the International Monetary Fund (IMF) arrived Saturday in Argentina to meet with officials from the current administration and the Peronist opposition leading in the presidential polls set to take place October 27.
Authorities from the ministry of finance will meet with the IMF in Buenos Aires on Saturday and Sunday. In a Friday-released statement the IMF said the meetings will "analyze recent economic and financial events and government policy plans."
The statement included that "the team will also meet with economic advisors of the main presidential candidates to exchange views."
On August 11, the opposition team—Alberto Fernandez and former president Cristina Fernandez de Kirchner (2007-2015)—under the ‘Frente de Todos’ ticket, won the primary presidential elections with 47.65 percent of the votes. Current president, Mauricio Macri, was 15 points behind with 32.08 of the ballots.
Last week Fernandez told a crowd at a Buenos Aires rally, "I have no problem helping the president (Mauricio Macri) to renegotiate in the way that I propose but do have a lot of trouble with is having to explain to the Fund the failings of the president. That the president will have to do," he added.
Since then the Argentine Stock Exchange collapsed by another 37.93 percent and the peso went as low as 54.5 to the dollar, but only because of a 55 percent floor policy.
Macri, who signed the US$56.3 billion loan last year, has taken out about US$5.4 billion from that amount so far, but the country’s now several-year economic crisis has not stabilized. As of Friday, the administration continued its old tactic of buying back devalued pesos by selling so-called Central Bank LELIQs, doing so in two separate auctions. However, these short-term bonds have a 74.98 percent interest rate attached to them so that the government is accumulating a daily debt of US$45 million in interest.
Nicolas Dujovne, who had helped negotiate the IMF loan, resigned last Saturday saying he thought the government needed "major changes" in its economic team. Macri appointed Hernan Lacunza to direct the portfolio the next two months before the elections.
Lacunza, who served as the economic minister for the Buenos Aires Province, met this week with economists from Frente de Todos, whose leader, Alberto Fernandez, said he was willing to collaborate to calm the markets before a possible government turnover.
The IMF loan is a ‘stand-by’, which carries with it heavy interventionism by the fund and austerity measures by the government. Along with a slew of other economic measures, Macri’s administration has reduced the nation’s science, art, education, health and technology budgets and their respective ministries and secretaries.
Tens of thousands of public workers have been laid off since 2016 and transportation and energy subsidies have disappeared, prompting the re-rise in popularity of Fernandez and Fernandez de Kirchner who is sitting lawmaker.