Government signs letter in which Argentina asks Biden for support in negotiations with the IMF

The Argentine government sent a letter to the President of the United States, Joe Biden, signed by the presidents of Brazil, Mexico, Chile, Colombia, Bolivia and Paraguay, asking for support for Argentina in its negotiations with the International Monetary Fund (IMF) to revise its agreement credit with the organization.

“We respectfully and affectionately ask you to support Argentina in the negotiations (…). The common and shared principles of democracy, human rights and social inclusion in the Americas must guide us to find a quick and effective solution for Argentina”, states the letter, released this Thursday by the Ministry of Foreign Affairs of the government of Alberto Fernández.

The letter recalls that Argentina has been working “hard” to pay off the “exceptional” debt contracted with the IMF, in reference to the loan of US$ 44 billion (R$ 210 billion) granted in 2018, when the country was governed by Mauricio Macri .

That package was refinanced a year ago, and the current government is trying a new renegotiation due to the effects that the pandemic, the war in Ukraine and a severe drought had on the Argentine economy.

Presidents Luiz Inácio Lula da Silva (PT), Andrés Manuel López Obrador (Mexico), Gustavo Petro (Colombia), Gabriel Boric (Chile), Luis Arce (Bolivia) and Mario Abdo Benítez (Paraguay) signed the letter. Lula even mentioned the Argentine crisis in a speech this Friday morning (23), in Paris.

“It is neither feasible nor desirable that demands that do not take into account changes in circumstances plunge Argentina into an unnecessary crisis that interrupts the ongoing recovery”, adds the text, which notes that “the inflexibility of the IMF in revising the parameters of the agreement in the context of the drought runs the risk of transforming a liquidity problem into a solvency problem”.

This week, Argentina must pay the IMF US$ 2.7 billion (R$ 12.8 billion), of which the payment process of US$ 1.9 billion (R$ 9 billion) has already been activated.

To face the new installments, and amid the large fiscal imbalances and the shortage of dollars that the country is dragging, the government is advancing in negotiations with the IMF to redefine the agreement signed in 2022 with which the original credit was refinanced.

“Extraordinary circumstances deserve extraordinary responses, as extraordinary as the over-indebtedness caused by the loan from the IMF, which is one of the main causes of the current situation. We seek a solution that allows Argentina to grow, generate jobs and increase its exports”, stated the presidents at the Letter.

“All these conditions are necessary for the country, in turn, to be able to meet the maturities of the referred loan”, they observed.

Fernández thanked “deeply”, on Twitter, the support of his colleagues, which he considered “another sign of strength as a region” if they work “in unity”.