Argentina’s Congress approved President Javier Milei’s request for a new IMF loan to reinforce foreign currency reserves and address debt payments. The vote allowed Milei to proceed despite ongoing public protests against austerity measures. The loan aims to combat Argentina’s significant inflation rate, currently one of the highest worldwide.
On Wednesday, Argentina’s Congress approved President Javier Milei’s request to negotiate a new loan agreement with the International Monetary Fund (IMF). This comes in addition to the existing $44 billion debt that Buenos Aires owes the IMF. The proposed 10-year loan aims to strengthen the central bank’s foreign currency reserves and manage upcoming debt payments, although the specific amount of the new loan remains undisclosed.
Milei is required by a 2021 law to seek Congressional approval for IMF funds, but he only needs support from one house to move forward. The Chamber of Deputies voted with 129 in favor and 108 against, securing the necessary backing for Milei to finalize the agreement. Despite his party’s minority status in Congress, he has managed to form temporary alliances to advance his fiscal policies.
Protests erupted outside the legislature, as thousands gathered to oppose Milei’s austerity measures and negotiations with the IMF. Demonstrator Rodolfo Celayeta, a 73-year-old retiree, expressed discontent, stating, “Every time something is agreed with the IMF, things get worse for us.” The protests were more subdued than previous weeks’ confrontations, which left many injured. Security Minister Patricia Bullrich lauded the security measures, saying the operation with 2,000 officers was “successful.”
Milei has asserted that acquiring the new IMF loan will enable his government to settle debts with the central bank and work towards “exterminating” inflation, which has long plagued the nation. Argentina currently faces one of the highest inflation rates globally. Since Milei took office in December 2023 and instituted substantial cuts to public expenditure, inflation rates have notably decreased from 211 percent at the end of 2023 to 66 percent presently.
The government commenced discussions with the IMF in November to create a new “extended fund facility” (EFF) that would replace an existing agreement from 2022. This new deal aims to refinance the debt linked to the record-setting $44 billion loan that was originally agreed upon under former President Mauricio Macri in 2018.
The approval of the new IMF loan by Argentina’s Congress marks a significant step for President Javier Milei in managing the country’s financial obligations and combating inflation. Despite public protests against his austerity measures, the administration is determined to proceed with these financial negotiations. The outcome of the loan talks could have profound implications for Argentina’s economic stability going forward, especially in light of its high inflation rates.
Original Source: www.news-expressky.com
