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  • Incoming IMF Managing Director Kristalina Georgieva (L) and Argentina’s Finance Minister Hernan Lacunza in New York, U.S, Sep. 25, 2019.

    Incoming IMF Managing Director Kristalina Georgieva (L) and Argentina’s Finance Minister Hernan Lacunza in New York, U.S, Sep. 25, 2019. | Photo: Twitter/ @KGeorgieva

Published 26 September 2019
Opinion

The International Monetary Fund will not disburse immediately the US$5.4 billion which President Mauricio Macri had been looking forward to.

The International Monetary Fund (IMF) on Wednesday appointed Kristalina Georgieva as its new managing director, a Bulgarian economist who met with Argentina's Finance Minister Hernan Lacunza in New York even before formally taking office.

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"I look forward to working with the authorities as I take on my duties on October 1. Argentina is an important member of the IMF and we want to see it succeed," Georgieva tweeted.

Her meeting with Minister Lacunza took place on the same day in which it was known that the IMF will not disburse a US$5.4 billion tranche of a US$57 billion loan deal, which Argentina expected to receive by mid-September.

The IMF decision caused immediate concern within President Mauricio Macri administration because both the Inter-American Development Bank (IDB) and the World Bank (WB) could also retain their credit lines.

The IMF spokesperson Gerry Rice on Thursday said that "it will be difficult to find a quick solution" for the economic crisis in Argentina, a South American country which must "wait" to resume a financial relationship with the multilateral institution.

The figures for Macri's failed economic model. Poverty, GDP fall, inflation, unemployment, very high-interest rates, closed companies, dollar leakage, debt, and drops in consumption, wages and retirement pensions. Look at the tables.

The IMF stance was predictable considering that right-wing candidate Macri is widely expected to lose to Alberto Fernandez at the second round of the Argentinean presidential elections to be held on Oct. 27.

This opposition candidate announced on Thursday morning that macroeconomic indicators clearly show that Argentina cannot pay its foreign debt in the short run.

"The debt is equivalent to 100 percent of Argentine GDP... we owe more than US$57 billion and all this happened in just one year. Incredible," Fernandez said and stressed that "under these conditions, Argentina cannot pay the debt."

Nevertheless, Argentina's most likely president announced that his government will undertake a "serious and sensible negotiation" of his country's multilateral debt.

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