Press Release No. 22302

Statement by IMF Managing Director Kristalina Georgieva on Argentina

September 12, 2022

Washington, DC: The Managing Director of the International Monetary Fund, Kristalina Georgieva, met today with Sergio Massa, Minister of Economy of Argentina, in Washington D.C. The meeting took place after a fruitful week of face-to-face technical meetings in the context of the second review of the program under the IMF’s Extended Arrangement with Argentina. After the meeting, Ms. Georgieva issued the following statement:

“I had a very positive meeting with Minister Massa, after a week of highly professional and productive discussions between our technical teams. We exchanged views on the fragile economic and social situation in Argentina, which is also affected by the complex global economic context. We discussed the impact of Russia’s invasion of Ukraine on the global economy and commodity prices, as well as the consequent fiscal and balance of payments implications for many developing economies.

“I congratulated Minister Massa for his appointment and his expanded portfolio, and for the strong steps that he and his economic team have taken to stabilize the markets and reverse a scenario of high volatility. The Minister expressed his clear intention to mobilize external support, intensify efforts to stabilize the economy, and secure sustainable and inclusive growth, under the principles of fiscal order and improved reserve coverage.

“I welcomed his strong commitment and drive to achieve the goals of the program—which will remain unchanged—and the conclusive progress made in critical areas, including:

• The macroeconomic framework, which was updated to reflect recent economic developments and the difficult international context.
• The fiscal parameters and underlying policies to secure the existing primary deficit targets of 2.5% of GDP in 2022 and 1.9% of GDP in 2023, with an emphasis on improved targeting of energy, transport, and water subsidies, along with better prioritization of spending and strict budget management.
• The solid and consistent implementation of the monetary policy framework to ensure the current objective of sustaining positive real interest rates, which is also necessary to tackle inflation and mobilize domestic financing, as well as ensure external competitiveness.
• Reserve accumulation , which will be promoted by the overall policy framework, in addition to specific measures (such as the temporary incentive regime for agro-exports) to strengthen the trade balance.

• The structural agenda, where greater focus will be placed in reviewing corporate tax incentives and combating tax evasion and money laundering, including through efforts to promote information exchanges and international cooperation.

"Our teams will continue the meetings virtually this week with the aim of concluding staff level agreement in the coming days."

First Deputy Managing Director Gita Gopinath, and Western Hemisphere Department Director Ilan Goldfajn also participated in discussions with Minister Massa, Central Bank President Pesce, and his team over the course of the past week.