Argentina strikes potential deal to refinance $45 billion debt


Argentine Vice President Cristina Fernandez, left, and President Alberto Fernandez wave after attending the ceremony marking the opening session of Congress in Buenos Aires, Argentina, Tuesday, March 1, 2022. The Argentine government announced Thursday March 3 that it had reached a deal with the International Monetary Fund to refinance some $45 billion in debt, marking an attempt to avoid default and ease the economic uncertainty that has plagued the country for two years of negotiations.Natasha Pisarenko/AP

BUENOS AIRES (AP) — Argentina’s government announced Thursday that it has reached an agreement with the International Monetary Fund to refinance some $45 billion in debt, marking an attempt to avoid default and ease uncertainty. economy that hung over the country for two years of negotiations. The deal would allow Argentina to start repaying its debt from 2026 and continue until 2034, the economy ministry said in a statement. The existing arrangement had concentrated payments in 2022 and 2023, the statement said.

The revised terms must first be approved by the Argentine Congress and then by the IMF’s Executive Board to enter into force. The government said it would submit legislation later on Thursday, although it was unclear whether the measure would pass.

Some members of the government’s legislative coalition, particularly lawmakers allied with Vice President Cristina Fernández, who served as president from 2007 to 2015, have already signaled their opposition. They blame the multilateral lender for forcing Argentina into tough austerity measures in the past and fear this deal could produce similar circumstances.

Lawmakers allied with the government could find common cause with opposition members, who will scrutinize the details of the deal for signs that it could worsen the country’s economic prospects and impose hardship on ordinary people.

A committee in the lower house of Congress is expected to begin debating the issue on Monday.

If approved, the deal would replace the IMF’s extended lending program in 2018 under the administration of conservative President Mauricio Macri. At the time, it was the largest IMF loan program ever to a single country.

At the end of January, President Alberto Fernández announced an agreement with the IMF to refinance the debt, and the two parties had since engaged in discussions on the details.

The IMF said in a statement that the new program is “pragmatic and realistic” and aims to tackle Argentina’s persistently high inflation by reducing financing for the country’s fiscal deficit.

This “will strengthen macroeconomic stability and respond to the profound challenges facing Argentina,” the statement said.

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