Members of the International Monetary Fund (IMF) will arrive on Monday in Buenos Aires to analyze the Argentine administration’s Central Bank accounts and to approve the US$11 billion March disbursement, say local media.
Argentina: Protests Against President Macri Austerity Continue
Roberto Cardarelli, who is heading IMF’s "Argentine case" will decide if the government will receive the US$11 billion to be used to repay its mounting bond debt.
Cardarelli will meet with Finance Minister Nicolas Dujovne and Central Bank President Guido Sandleris and may meet with a wider range of representatives from opposition parties and civil society organizations. "We will try to meet with a wide range of sectors, with officials, representatives of the private sector and civil society, and maybe with opposition leaders," said IMF spokesperson Gerry Rice said last week.
According to a local media outlet, Pagina 12, opposition party members have said that if they win in next October’s presidential elections they will renegotiate the US$50 billion IMF deal signed last June and then re-bargained in September that increased the amount to US$56.3 billion. Along with the increased in dollars came the promise by President Mauricio Macri to decrease the fiscal deficit to zero by 2020, down from the original 1.3 percent of GDP.
Meanwhile, protests against the loan continue throughout Argentina. Major national labor unions and civil society organizations protested last week against the austerity measures in place since Macri took office in 2015 that became even tougher when the IMF loan went into effect. Experts comment that the austerity measures such as cutting state jobs and housing, education and health programs have helped bring on the country’s current recession.
Macri Would Lose If Argentines Went to Polls Now: Survey
In a December-released study by the Center for Economic and Policy Research
(CEPR) lead author Mark Weisbrot said that it’s unrealistic for government officials to expect the Argentine economy to turn around while being restricted by profound and wide-ranging austerity plans.
"The problem is that 'expansive austerity' does not work."
The economist stated: "The IMF program focuses on 'building confidence in the market', but recessions generally do not generate such confidence. And there is no discrepancy in the position that the policies that Argentina is implementing within the framework of the program are negatively affecting its economy."
The IMF expects the Argentine economy to recover by April, but Weisbrot and co-author of the study, Lara Merling, say the fund is being too optimistic in their economic calculations. “Given the loss of income during the recession and the pressure for spending cuts to meet the program's main budgetary objectives, it is almost certain that this will not happen,” conclude Weisbrot and Merling.
“There will be more suffering and difficulties for millions of Argentines as unemployment and poverty increase with recession,” say the CEPR experts.
Inflation still remains high at around 38 percent and purchasing power decreased for the average Argentine by 17.3 percent between November 2017 and 2018 alone. With that, the Association of State Workers (ATE), Confederation of Workers for the Popular Economy (CTEP), Neighborhoods Standing Up, and the Front of Organizations in Struggle will mobilize across the country on Feb. 11 against "the adjustments and tariffs," or slashing of gas, water and fuel subsidies increasing these daily costs for residents by as much as 1,000 percent in some cases.