Business & Economy

Protesters march in Buenos Aires against agreement with IMF

Buenos Aires, Feb 8 (EFE).- Left-wing opposition political groups, social organizations and trade unions marched through the heart of Argentina’s capital city of Buenos Aires on Tuesday to protest the agreement reached between the government and the International Monetary Fund (IMF) to refinance more than $40 billion in debt.

The march towards the Plaza de Mayo, located in front of the seat of the government, was called by politicians including lawmakers Myriam Bregman and Nicolás Del Caño, of the Left Front coalition against the government of Peronist Alberto Fernández.

In late January, the government announced that it had reached a preliminary deal with the IMF to restructure a loan granted in 2018, when Mauricio Macri was still in power.

“These agreements have always ended in adjustment, in unemployment and in enormous social crises. This huge (gathering at the) square is to say no to that, and we added a very important slogan: no more extractivism to pay the debt,” Bregman told EFE.

Negotiations between Argentina and the IMF to extend loan repayment deadlines have been ongoing for months amid a scarcity of resources and the looming expiration of the deadline in March, when Argentina is due to pay $3 billion.

Argentina’s loan has risen to $44.2 billion in the midst of a complex economic scenario that the country has been grappling with for four years.

As per the original agreement, out of this total, the South American country would still have to repay, between capital and interest, $19.02 billion in 2022, $19.27 billion in 2023 and $4.85 billion in 2024.

The government reiterated that it would not be able to meet this repayment schedule and thereby sought to reach a new agreement with the IMF.

“We are saying that it is the government that has to explain why it will be different this time. We are going to continue protesting so that the adjustment is not paid by the popular majority,” the national deputy added.

The leader of the Workers’ Socialist Movement, Celeste Ferro, told EFE that “validating the Macrista scam is not the way out and we must break with the Fund. Don’t pay that debt and allocate those billions to resolve the structural problems of our country.”

After the announcement of the deal with the IMF, Finance Minister Martín Guzmán said that it would not imply any type of adjustment since it would involve a “reallocation of the State’s resources.”

The deal includes an “extended fund facility” with money distributed over a two-and-a-half year period, and a package of economic measures, including a “gradual reduction” of the primary fiscal deficit to represent 2.5 percent of the GDP in 2022, 1.9 percent in 2023 and another 0.9 percent in 2024.

To finance the fiscal deficit without resorting to issuing money, Guzmán suggested that the government maintain its strategy of turning to the local market to obtain a debt in Argentine pesos.

In this regard, Del Caño said that a “new debt is taken to pay off Macri’s illegitimate and illegal debt. At the cost of deepening the country’s dependence with 40 percent poverty, minimum wages and pensions… unstable labor and inflation.”

According to the National Institute of Statistics and Census, the country ended 2021 with an inflation of 50.9 percent and 40.6 percent poverty, with 10.7 percent of the population living in destitution. EFE


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