Washington (United States) (AFP) – The International Monetary Fund (IMF) said Wednesday it had reached an agreement with the highly indebted Argentine government as it reviews the country’s financial reforms, paving the way for a $1 billion dollar disbursement. “Policy momentum has strengthened in recent months,” the IMF said, noting that its monetary and exchange rate policies are “improving Argentina’s capacity to manage shocks.” This new tranche of funds — the third planned under a 20-billion-dollar program announced in April 2025 — must still be approved by the Fund’s Executive Board.
This new disbursement would bring the total money already allocated to Argentina by the IMF to $15 billion. The South American country has managed “to weather well spillovers from the Middle East war,” the Fund said, in no small part because it is an energy exporter. Nevertheless, the Fund anticipates lower growth this year than in 2025 — 3.5 percent compared to 4.4 percent a year earlier.
However, inflation – which has long plagued Argentina – is expected to continue slowing, down to 30.4 percent year-on-year at the end of this year compared to almost 42 percent at the end of 2025. As large as those inflation figures are, they are a far cry from the 220 percent inflation Argentina experienced at one point. The Fund said that it had agreed with Argentina on a series of additional reforms “to entrench the impressive stabilization gains and sustained reductions in poverty levels since end-2023.”
Argentina’s economy expanded last year, after two years of contraction. However, the growth was uneven, with some sectors — such as financial services, agriculture, and mining — expanding, while others — like manufacturing and retail trade — slowing. Unemployment remains concerning, increasing by 1.1 percentage points to 7.5 percent over the past year, not including the large number of people informally employed across the country.
© 2024 AFP
