The government of Argentina opened a week of talks with a team from the International Monetary Fund (IMF) with the goal of seeking relief from what President Alberto Fernández says is an unsustainable debt. Fernández’s government has until the end of March to reach an agreement with foreign creditors before it runs out of cash to meet its obligations.
On the same day, the IMF officials heard from the economy minister Martín Guzmán that “there is going to be frustration among bondholders”. The statement was made during Guzmán’s presentation of a debt restructuring strategy to congress and was perceived to be tailored to draw support from the ruling coalition and also among the people.
He went on and said that the government would not allow foreign investors to dictate the government’s economic policy. “It is neither realistic nor sustainable to reduce the fiscal deficit in 2020. We need expansive policies.” Softening his words, Guzmán added that there is “growing mutual understanding with the IMF”.
READ MORE: In Fernández’s Argentina, it will be necessary to read between the lines
In an interview with Financial Times, Jimena Blanco, head of Latin America at Verisk Maplecroft, a risk consultancy, said that President Fernández needs to ensure a balance between a pragmatic resolution and maintaining de political support of allies. Former president and current vice-president Cristina Fernández de Kirchner is one of them. She recently called for a “substantial” cut to the country’s $44 billion debt with the fund.
