Economy

Argentine President expects new, sustainable IMF deal soon

"I have asked the IMF to understand the moment we are living in. I hope an agreement can be reached soon," said Fernández

Photo: Esteban Collazo/Argentine Presidency/Handout via REUTERS
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  • Argentina is seeking to replace a deal struck with the IMF in 2018 and defer payments it cannot meet amid the recession;
  • The Argentine President had said in March that he did not want to rush into a new agreement.

Argentina‘s President Alberto Fernandez said on Monday he hopes to reach a new sustainable agreement with the International Monetary Fund (IMF) that will allow his heavily indebted country to develop and take into account post-pandemic conditions.

“What we have always asked for is an agreement that does not call into question our ability to develop and end inequality. I want to reach a sustainable agreement,” he told reporters.

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Argentina is seeking to replace a deal struck with the IMF in 2018 and defer payments it cannot meet amid the recession, deepened by the COVID-19 pandemic.

“I have asked the IMF to understand the moment we are living through. I hope that an agreement can be reached soon,” Fernández said during a visit to Lisbon.

The Argentine President had said in March that he did not want to rush into a new agreement. Many investors now expect that the pact, which was initially supposed to be closed in May, will only be reached after the elections in November.

He also said in a joint interview with Portuguese Prime Minister Antonio Costa that his government is working with creditors to change some rules of the international financial system in the post-pandemic world.

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“I was able to convey to the prime minister the situation in which Argentina finds itself and the work we are doing with the creditors to try to reach not only an agreement between the IMF and Argentina but also to change some rules of the international financial system that are related to the post-pandemic world,” Fernández said.

European Union – Mercosur

On his behalf, Costa said that conditions are now in place to quickly close a deal between South American trade bloc Mercosur and the European Union (EU), which Portugal hopes will be reached during its six-month EU presidency until June 30.

The pact agreed in 2019 after 20 years of negotiations, promised to be the EU’s biggest, removing 4 billion euros in import tariffs.

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But ratification has stalled due to concerns among EU members about deforestation in Brazil’s Amazon region. Mercosur countries say they are awaiting an EU text on climate change that would address those concerns.

Costa said the EU needed to present its document as soon as possible. Fernández said that some countries are still creating difficulties in the negotiations and that the two blocs need to “work a little harder” on the agreement.

(Translated by LABS)

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