In the midst of a severe financial crisis, Argentina received a loan from the CAF for USD 960 million to pay the International Monetary Fund, as indicated by the Central Bank.

Spokespersons for the organization indicated that the country “will make the necessary efforts to restore the validity of the agreement signed with the International Monetary Fund (IMF).”

The short-term credit was approved by the Development Bank of Latin America, CAF, and will be used to make the payment corresponding to a debt maturity with the IMF.

In the words of the new president of the nation, Javier Milei, this is the first great achievement, recently assumed the mandate, aimed at avoiding default. The CAF loan will provide the country with liquidity for the “payment of debt services that come due next week with the IMF, an organization to which the South American country owes some 46 billion dollars.”

For its part, the CAF issued a statement explaining the procedure for granting this money, indicating that other multilateral banks participated under the coordination and consultation of the IMF.

Milei, who since his presidential campaign showed a radical position on economic and financial matters, announced last Tuesday “a severe adjustment plan with the aim of recovering fiscal balance in 2024, which includes spending cuts and tax increases, in addition to a 50 % devaluation in the Argentine peso that took place last Wednesday.”

The measures have been welcomed positively by the IMF, as it believes that they will help significantly improve public finances.

M.Pino

Source: bancaynegocios

(Reference image source: Unsplash+, in collaboration with Planet Volumes)

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