Buenos Aires Times | Fernández urges IMF to halt surtaxes on US $ 45 billion loan
President Alberto Fernández has urged the International Monetary Fund to suspend the alleged surcharges applied by the multilateral lender to countries that heavily use its lines of credit.
“I am awaiting his suspension during the pandemic. I hope that the Fund’s board will discuss them at its October meeting and eliminate them once and for all, ”Fernández said in a joint statement with Spanish Prime Minister Pedro Sánchez in Madrid on Tuesday.
The request comes as Fernández visits European allies to gain support for Argentina’s attempt to renegotiate its record $ 45 billion loan with the IMF. The government said it could not repay the credit, which stems from a failed 2018 program, and was seeking relief amid difficult economic times, including worsening poverty and annual inflation of over 40%.
The Washington organization charges a rate of 200 basis points on loans outstanding above 187.5 percent of a country’s quota, rising to 300 basis points if a loan remains above that percentage after three years, according to its website. Argentina’s three-year standby agreement, initially issued for US $ 56 billion, represents more than 10 times the country’s allocation with the IMF.
The Portuguese and Spanish governments have already expressed their support for Argentina at Fernández’s request this week. An IMF spokesperson declined to comment.
Without a deal, Argentina is expected to pay US $ 4.8 billion in principal and interest to the IMF by the end of the year. The country is also facing a $ 2.4 billion maturity with the Paris Club this month, which Fernández is also trying to postpone.
by Jorgelina do Rosario, Bloomberg