US should help Argentina find 'long-term solution' to IMF talks, says senior US congressman

[peppertree]

The United States should do more to find a "long-term solution" for Argentina as it holds debt restructuring talks with the International Monetary Fund (IMF), according to House Foreign Affairs Committee Chairman Gregory Meeks.

Argentina - which received $45 billion in credit from a $57 billion IMF program signed in 2018 - is seeking to convert the 4-year Stand-By loan into an Extended Fund Facility (EFF) and to delay repayments for over four more years.

Meeks, 67, said that that the US should ensure that any agreement with the IMF will "not protract the economic challenges also facing the country" during the Covid-19 pandemic, which has cost over 66,000 lives in Argentina.

"While it is vital to maintain confidence," Meeks noted, "it is also paramount that we get all the interested parties together to find a solution and do it as quickly as we can."

Previously, Argentine President Alberto Fernández - who inherited the loan from Mauricio Macri - has said that the debt is "unpayable" under current conditions.

The country faces IMF payments of over $18 billion annually in 2022 and 2023, besides other foreign debt service of over $10 billion annually.

Two weeks ago, Martín Guzmán, Argentina's Economy Minister, said that Argentina is making "progress" in its talks with the IMF.

Guzmán's successful refinance of $66 billion in foreign debt last August (around a third of the total) trimmed the country's foreign debt service by 35% from its 2019 record of $17.4 billion.

At: https://www.lapoliticaonline.com.ar/nota/133848-us-should-help-argentina-find-long-term-solution-to-imf-talks-says-senior-us-congressman/

House Foreign Affairs Committee Chairman Gregory Meeks shares a Zoom meeting with Argentine House Speaker Sergio Massa, who thanked the new chairman for his support for Argentina's debt restructuring talks with the IMF.

The country owes $45 billion on a record credit line granted to former President Mauricio Macri in 2018 at the behest of then-President Donald Trump, a longtime Macri friend.

[Judi Lynn]

1. Chairman Meeks is supportive of people first. He's no grifter, like the Republicans.

Hoping he can provide some very helpful support to the courageous President of Argentina, who has stepped forward to help his country right itself after the beating the people took at the hands of fascist grifter Mauricio Macri and his pals.

Thank you, peppertree!

[peppertree]

2. Well said, Judi. It's the pragmatic thing to do - besides being the right thing to do.

As mentioned in the article, the $18 billion+ yearly IMF payments Macri left Argentina to face are simply unaffordable.

The country will at most be able to earn $10 billion annually in trade surpluses, and with no other source of dollars (having been cut off from credit markets for 3 years now) the foreign exchange needed to meet those payments - besides the bondholders' - just isn't there.

Yes, the IMF would have to bend its rules to convert the Stand-By (4-year) loan into an Extended Facility (10-year) loan) - but isn't that what they did when they gave Macri that record credit line to begin with?

And just to placate Señor Trump! (who demanded they do so)

Goes to show that Trump (or Macri), and debts, mix like oil and water: they leave a mess.

Thanks again for your insights and good energy. Always appreciated.

Have a great weekend.