IMF says will move quickly on Argentina loan; no details yet

WASHINGTON - Agence France-Presse

The International Monetary Fund will move quickly to agree on a loan program to support Argentina but there are no details yet on what it will entail, a fund spokesman said on May 17.

However, the official stressed that the current situation -- marked by “renewed financial market volatility” that has hit the country’s currency -- is very different than the last time Argentina went to the IMF for aid.

Officials don’t have a date for concluding the talks but the IMF “can move quickly...and we intend to move quickly,” spokesman Gerry Rice told reporters at a briefing.

However, the size, exact type and terms of the financial package will be “part of discussions” with Argentine authorities that began last week and details will be developed.

The IMF board was scheduled to hold an informal meeting on Argentina on May 18  to get an update from staff but the final loan will not be approved until negotiations have been completed, he said.

The country is seeking a “high access” standby arrangement, which according to press reports could amount to $30 billion. SBAs can last up to three years and usually grant periodic disbursements as the country meets previously agreed economic targets.

Argentine President Mauricio Macri’s decision to seek help from the Washington-based lender was a risky move given the bitter relations during the last crisis 17 years ago and the popular view that the IMF imposed tough conditions that worsened the economic pain.

But Rice stressed that conditions have changed.

“Our ultimate goal is to help support the authorities in their efforts to strengthen the Argentine economy and to protect the living standards of the Argentine people, and particularly for the most vulnerable groups,” he said.

But the situation is “vastly different” than the previous crisis and policies and institutions have been “strengthened considerably.”    

A crisis of confidence in the Argentine peso has seen it plunge nearly 20 percent over the past six weeks and forced Argentina to seek a financial lifeline from the IMF.