Argentina’s Congress has approved President Milei’s decree supporting a new IMF deal, allowing for a future programme announcement. The decision comes amid ongoing negotiations, with vital details remaining undisclosed, and protests against low pensions escalating in intensity outside Congress. The government’s rationale for urgent borrowing cites reducing the national debt amid severe economic conditions.
On Wednesday, Argentina’s lower house of Congress authorized President Javier Milei’s emergency executive decree endorsing a new agreement with the International Monetary Fund (IMF). The Chamber of Deputies voted in favor of the decree with a tally of 129 to 108, along with six abstentions, enabling the decree to become law based solely on approval from one congressional chamber.
To initiate a new IMF programme, Argentina required congressional endorsement, and negotiations with the lending institution are ongoing. Important specifics regarding the potential programme have not yet been disclosed, which has led to heightened speculation regarding changes to currency policy, contributing to a decline of the Argentine peso in the parallel market, reaching its lowest point in over five months.
In an attempt to stabilize market confidence, Economy Minister Luis Caputo engaged with local media, yet he refrained from revealing any forthcoming policy modifications. Outside the congressional proceedings, protesters demonstrated against low pensions, highlighting a tense atmosphere as several of them collided with security forces during their demonstrations, resulting in injuries and numerous detentions last week.
Milei’s administration maintains that the proposed IMF programme will facilitate the repayment of the Central Bank’s debts to the Treasury, suggesting that this will effectively lower the nation’s overall debt burden. Additionally, it contends that the dire economic conditions necessitate proceeding with the borrowing arrangement via presidential decree rather than obtaining full congressional consent.
As the largest debtor to the IMF, Argentina’s upcoming agreement would mark the 23rd accord, establishing a record for the highest number of agreements by a single nation.
In summary, Argentina’s Congress has sanctioned President Javier Milei’s decree to support a new IMF agreement, paving the path for essential financial negotiations. Despite uncertainties regarding specific policy adjustments, the government positions the programme as a means to alleviate the national debt. The socio-political climate remains strained, illustrated by ongoing public dissent against economic hardship. As such, the global community will watch closely how these developments unfold for Argentina’s financial future.
Original Source: batimes.com.ar
