After months of negotiations, President Alberto Fernández unveiled a new debt repayment agreement with the International Monetary Fund on Friday morning, the day a $700 million payment fell due.
“I want to announce that the Argentine government has reached an agreement with the International Monetary Fund,” the Peronist leader said in a video filmed from the garden of the presidential residence in Olivos.
Stating that the deal with the multilateral lender would “order the present and build the future”, the president did not reveal details of the new funding program in a short speech.
Argentina was due this year to repay $19 billion of its $44 billion debt to the IMF. Fernández said the country was living with “a rope around its neck, a sword of Damocles, and now it has a path it can follow”.
“Without an agreement, we had no horizon for the future. With this agreement, we can bring order to the present and build a future,” said the Frente de Todos leader.
Fernández gave no details on the new agreement, saying only that “compared to the previous ones signed by Argentina, this agreement does not envisage restrictions that would delay our development”.
He added: “It does not restrict, limit or condition the rights of our retirees. It does not require us to carry out labor reform. It promotes our investment in public works. It does not require us to achieve a zero deficit.”
“It doesn’t impact public services, it doesn’t relegate our social spending and it respects our plans for investing in science and technology,” he said.
The head of state called on the opposition to support the agreement in Congress, as he criticized his predecessor in power, Mauricio Macri, without naming him.
“We need them to support this agreement and I appeal to the national commitment of all of us,” said Fernández.
“History will judge who did what. Who created a problem and who solved it. I invite you to look to the future without forgetting the past,” he added.
Macri originally agreed to a $57 billion loan with the IMF in 2018, but when the Fernández government took office a year later, the Peronist leader refused to accept the final installment of $13 billion.
After successfully restructuring $66 billion in debt with private international creditors in 2020, the government entered into negotiations with the IMF to delay repayments.
Argentina has been in recession since 2018. The economy grew by around 10% in 2021, following a 9.9% drop in GDP in 2020 amid the coronavirus pandemic.
“There was a very serious and urgent problem and now we have a possible and reasonable solution. It is time to unite in the solutions and not to divide on the problems. I have confidence in Argentina”, he concluded.
Details of the new deal are expected to be released later Friday by Economy Minister Martín Guzmán. Under the previous deal, Argentina is expected to repay $19 billion this year, $20 billion next year and another $4 billion in 2024.
The government had repeatedly said the repayment schedule was unsustainable given its lack of reserves and was pushing for a restructuring of the repayment schedule.
“This agreement plans to support the economic recovery that has already begun,” Fernández said on Friday.