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News > Latin America

Argentina: Macri Faces Prosecution Over IMF Deal

  • Mauricio Macri at a meeting with the country's industrial sector.

    Mauricio Macri at a meeting with the country's industrial sector. | Photo: Reuters

Published 5 September 2018

An Argentine judge is also reviewing a writ of protections that seeks the nullity of the IMF US$50 billion standby loan.

Federal prosecutor Jorge Di Lello has indicted Argentina’s President Mauricio Macri and other officials of abuse of authority and violation of duty after Popular Unity leader Claudio Lozano and Jonatan Baldiviezo, of the Right to the City Observatory, filed a lawsuit Tuesday over the agreement reached with the International Monetary Fund (IMF).

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Lozano and Baldiviezo argued the president and members of his government signed the agreement with the IMF without having congressional authorization. The prosecutor has decided to proceed with criminal prosecution stating the facts show that illegalities and unconstitutional actions are feasible. Di Lello also requested Lozano and Baldivieso to submit evidence.

“Macri’s government incurred an abuse of power by not submitting the IMF agreement for Parliamentary approval as the National Constitution orders. … On the other hand, the IMF made the loan in violation of its own statute, which prevents it from lending money to countries with a capital flight situation,” Lozano explained.  

On Monday, President Macri announced his government will push for a new agreement with the IMF and new cuts in public spending as the peso dropped to 38.99 against the U.S. dollar. On Tuesday, Economy Minister Nicolas Dujovne met with IMF executive director Christine Lagarde to begin working on the new agreement to access more funds for the 2019 budget.

After the meeting in Washington D.C. Dujoven told the press the deal would “improve the terms of the agreements signed in June,to strengthen the program. Argentina already took steps in the last few days with the announcement of fiscal measures.”

Argentina, which already received US$15 billion of the US$50 billion agreed-upon loan, is seeking an advance of the funds for the following year. However, the entire agreement might be upended by the Argentine judicial system. 

Judge Julian Ercolini is currently reviewing whether or not to order precautionary measures to suspend the execution of the IMF agreement. The criminal suit presented by Lozano and Baldiviezo is paired with a writ of protections that seeks nullification of the IMF's US$50 billion standby loan.

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