The Executive Board of the International Monetary Fund (IMF) approved an agreement with Argentina in the framework of the three-year stand-by agreement for US$ 50 billion – or about 1,110% of the quota of Argentina in the Fund.
The decision allows the authorities to make an immediate release of US$ 15 billion. Half of that amount would go to budget support. The remainder should be available throughout the agreement term, subject to quarterly reviews by the executive board of the Fund.
“The authorities have announced the intention to get the first tranche of the agreement, but later they should treat the rest of the agreement as a precautionary measure,” the IMF said in a statement.
According to the Fund, the economic plan of the Argentinean authorities backed by the stand-by agreement seeks to restore market confidence through a coherent macroeconomic program that reduces financing needs, channels Argentina’s public debt to a downward path and strengthens the plan to curb inflation through more realistic inflation targets and the strengthening of central bank independence.
“It should be noted that the plan includes measures to protect the most vulnerable segments of society by keeping social spending and, should social conditions deteriorate, opening room to increase spending on the Argentinean social protection network,” added the IMF.