IMF, Argentina in advanced talks over new loan program

The seal of the International Monetary Fund at the headquarters building in Washington, DC. The photo was taken on April 12, 2024 ahead of the IMF/World Bank 2024 Spring Meetings. (Photo by MANDEL NGAN / Agence France-Presse)

WASHINGTON, United States — The IMF and Argentina are in advanced talks on a new loan agreement, a Fund official said Tuesday, as President Javier Milei continues his shock therapy approach to economic reforms.

“Discussions on a new Fund-supported program are advanced, and as part of our routine internal processes, Fund staff is engaging with the Executive Board,” an International Monetary Fund official said in a statement shared with AFP.

The official, who spoke on condition of anonymity, did not provide further details on the nature of the talks between IMF staff and the executive board, which represents the interests of member states.

The IMF’s statement follows a vote in Argentina’s Congress last week, which gave Milei the green light to negotiate a new IMF loan agreement, on top of the $44 billion Buenos Aires already owes the lender.

READ: Argentina says aiming for new IMF loan deal by end April

In need of foreign currency boost

Milei asked lawmakers on March 11 to approve a new 10-year loan to boost the central bank’s foreign currency reserves and cover looming debt payments.

Under a 2021 law, Argentina’s president must seek authorization from both houses of Congress to request money from the IMF, but needs support from only one to go ahead with the loan.

Bloomberg News previously reported that IMF would meet with the executive board this week to discuss a new four-year loan program for Argentina worth close to $20 billion, adding that the final amount could still change.

An IMF spokesperson declined to comment on the size of the loan under consideration.