Argentina’s Congress has sanctioned President Javier Milei to negotiate a new IMF loan, building upon an existing $44 billion owed. The approval follows Milei’s proposal for a ten-year loan aimed at enhancing foreign reserves and addressing debt payments. Protests against austerity measures continue as the government seeks to address soaring inflation.
On Wednesday, Argentina’s Congress authorized President Javier Milei to negotiate a new loan agreement with the International Monetary Fund (IMF), in addition to the existing $44 billion owed. The president requested lawmakers’ approval for a ten-year loan aimed at enhancing the central bank’s foreign currency reserves and managing upcoming debt payments. The specific amount of the prospective loan remains undisclosed.
Argentina’s legislation of 2021 requires presidential authorization from both houses of Congress to access IMF funds but allows the president to proceed with the support of just one house. The Chamber of Deputies approved Milei’s request with a vote of 129 in favor, 108 against, and six abstentions, enabling him to finalize the agreement despite his party’s minority status in Congress.
The loan approval occurs amidst widespread protests against Milei’s austerity measures and IMF negotiations. Demonstrators, including 73-year-old retiree Rodolfo Celayeta, expressed dissatisfaction, asserting that prior agreements with the IMF have led to worsening conditions. Last week, clashes between protesters and police resulted in injuries, highlighting the tensions surrounding Milei’s policies.
Milei believes that securing the new IMF loan will facilitate debt repayments to the central bank and help “exterminate” inflation, which has plagued Argentina for years. Since his taking office in December 2023, Milei has implemented significant public spending cuts, leading to a reduction in inflation from 211% year-on-year at the end of 2023 to 66% currently. However, the country’s poverty levels have also increased as a consequence.
The Argentine government has been negotiating with the IMF since November to establish a new “extended fund facility” that will help refinance its debt and replace an existing agreement from 2022, originally negotiated in 2018 under former president Mauricio Macri, which represented the largest loan ever granted by the IMF.
In summary, Argentina’s Congress has approved President Javier Milei’s request to secure a new IMF loan, a crucial step in managing the nation’s substantial debts and addressing inflation. This development comes amidst public protests highlighting the contentious nature of Milei’s austerity policies. While the president aims to alleviate financial burdens, the impact on poverty and public sentiment remains a significant concern moving forward.
Original Source: www.sanfordherald.com
