Argentina’s Congress approved President Milei’s request for a new IMF loan to manage existing debt and strengthen currency reserves, despite rising protests against austerity measures. The loan could aid in tackling the country’s high inflation rate, which fell significantly since late 2023, yet poverty levels have increased under Milei’s spending cuts.
Argentina’s Congress has authorized President Javier Milei to negotiate a new loan agreement with the International Monetary Fund (IMF), adding to the existing $44 billion debt the country owes. In a request made on March 11, Milei sought approval for a 10-year loan aimed at bolstering the central bank’s foreign reserves and managing impending debt obligations. The specific loan amount has yet to be disclosed, but under current law, the president needs Congressional approval from one house to proceed with IMF negotiations.
The proposal passed in the Chamber of Deputies with 129 votes in favor, 108 against, and 6 abstentions, despite Milei’s libertarian party holding a minority position in Congress. The passage occurred amidst protests featuring thousands gathered near the legislative building, voicing opposition to Milei’s austerity policies and IMF discussions. Among the demonstrators, Rodolfo Celayeta, a retiree, expressed concerns, stating, “Every time something is agreed with the IMF, things get worse for us.” Previous protests had resulted in injuries due to clashes with law enforcement.
Milei has emphasized that the new IMF loan will enable the government to settle debts with the central bank and aims to “exterminate” the severe inflation problem plaguing Argentina, known to have one of the highest rates globally. Although inflation has decreased from 211 percent year-on-year in late 2023 to 66 percent currently, poverty rates have increased since Milei began reducing government spending shortly after taking office in December 2023. The government’s negotiations with the IMF started in November for an extended fund facility (EFF) intended to refinance the significant debt accumulated under the previous administration, led by Mauricio Macri in 2018.
In summary, President Javier Milei has received approval from Argentina’s Congress to negotiate a new IMF loan, amidst demonstrations against his austerity measures. The loan aims to bolster the central bank’s reserves and manage existing debts, while also targeting high inflation rates. As discussions move forward, it remains crucial to address the economic challenges and public concerns surrounding Milei’s fiscal policies and the implications of further IMF engagement.
Original Source: www.news-expressky.com
