IMF Approves Loan of Almost 745 Million Euros to Argentina

"All quantitative performance criteria until the end of March 2024 are being met with a margin", said the IMF board of directors, in a statement released on Thursday.

This decision to approve the eighth review of the current IMF aid program for Buenos Aires will bring the total payment already made to more than 41 billion dollars (38 billion euros).

The agreement between the multilateral institution and Argentina covers a total of 44 billion dollars (41 billion euros).

The IMF reiterated that "consolidating solid progress requires improving the quality of fiscal consolidation, taking steps to establish a roadmap to improve the monetary and exchange rate situation, and implementing a structural program."

"The good news continues", said the ultra-liberal Argentine President, Javier Milei, on the social network X (formerly Twitter).

The IMF's decision came one day after the upper house of Argentina's parliament approved a proposal by Milei that envisages a reform of the State, despite riots that left around ten people injured.

The legislation gives broad powers to the President in areas such as energy, pensions, security and includes tax incentives for 30 years for foreign investors, a tax amnesty for Argentines with undeclared assets abroad and an end to import tariffs.

Argentine unions have also voiced vehement opposition to labor law reforms that would make it easier for companies to fire employees, as well as privatization plans for some state-owned companies.

Unlike previous Argentine leaders since the return of democracy in 1983, Milei's party has a minority in parliament and was therefore unable to pass a single law during the first six months in office.

Therefore, the new President has preferred to apply executive power to reduce State spending and eliminate economic restrictions and regulations.

Argentina continues to face record inflation, although it continued to slow down in May, to 4.2% in monthly terms, the lowest value in two and a half years.

However, in annual terms, inflation continues to be very high, 276.4%, in a trend that accelerated after the devaluation of the Argentine currency, the peso, imposed by Milei at the end of 2023.

Argentina's economy is expected to contract by 2.8% in 2024, according to an IMF forecast, following a 1.6% recession recorded in 2023.