- The IMF Executive Board approved a 48-month Extended Fund Facility (EFF) arrangement for Argentina totaling US$20 billion (or 479 percent of quota), with an immediate disbursement of US$12 billion, and a first review planned for June 2025 with an associated disbursement of about US$2 billion. The program is expected to help catalyze additional official multilateral and bilateral support, and a timely re-access to international capital markets.
- Building on the authorities' strong track record, the arrangement supports the transition to a new phase of their stabilization and growth plan to entrench macroeconomic stability, strengthen external sustainability, and deepen structural reforms to create a more open and market-oriented economy.
- Policy priorities will center on sustaining a strong fiscal anchor, transitioning to a more robust monetary and FX regime, with greater exchange rate flexibility, and advancing reforms to foster productivity, competitiveness, and growth.
Washington, DC: The Executive Board of the International Monetary Fund (IMF) approved today a 48-month extended arrangement under the Extended Fund Facility (EFF) for Argentina amounting to SDR 15.267 billion (equivalent to about US$20 billion, or 479 percent of quota). The Executive Board's decision allows the authorities an immediate disbursement of SDR 9.2 billion, equivalent to about US$12 billion, to be followed by a first review planned for June 2025 with an associated disbursement of about US$2 billion. The new arrangement follows a request by the Argentine authorities for medium-term balance of payments assistance to support the next phase of their stabilization and reform agenda. The program is expected to catalyze further official financing from multilateral sources —notably from the World Bank Group and IDB—and bilateral sources, and seeks to facilitate a timely return to international capital markets.
The authorities' IMF-supported program aims to consolidate the impressive initial gains from recent policy efforts—anchored by strong fiscal and monetary adjustment and deregulation efforts—while addressing Argentina's remaining macroeconomic vulnerabilities. The program supports a path toward entrenching macroeconomic stability, strengthening external sustainability, and laying the foundation for stronger and more resilient growth.
Key pillars of the program include maintaining a strong fiscal anchor, transitioning towards a more robust monetary and FX regime, with greater exchange rate flexibility in the context of a gradual easing of FX restrictions, and advancing a broad range of structural reforms to foster a more dynamic, market-oriented economy. Continued steadfast policy implementation and strong contingency planning will be critical to secure program success, especially given elevated and rising global risks.
Following the Executive Board discussion, Ms. Kristalina Georgieva, Managing Director and Chair, made the following statement:
"The Argentine authorities' decisive implementation of their stabilization plan, centered on a strong fiscal anchor and broad structural reforms, has yielded rapid disinflation, a solid economic recovery, and incipient improvements in social indicators. Despite this early progress, Argentina continues to face vulnerabilities and structural challenges, including limited external buffers to address elevated and rising global risks as well as impediments to strong and sustainable growth.
"Against this backdrop, the authorities are embarking on a new phase of their stabilization plan, supported by a four-year Extended Arrangement under the IMF's Extended Fund Facility to entrench macroeconomic stability, strengthen external viability, and secure a timely re-access to international capital markets. Policy priorities center on (i) sustaining the strong fiscal anchor; (ii) facilitating an immediate transition toward a more robust monetary and FX policy framework; and (iii) deepening reforms to create a more open and market-based economy.
"Building on the authorities' commitment to a zero-deficit target and track record of delivering the first fiscal surplus in almost two decades, the program focuses on strengthening the quality and durability of the fiscal anchor. This will be supported by ongoing spending discipline, efficiency measures, and well-sequenced reforms of the tax, revenue sharing, and pension systems. Efforts will continue to provide sufficient fiscal space for priority social assistance and priority infrastructure spending.
"The authorities will transition toward a new FX regime with greater exchange rate flexibility to rebuild external buffers and better manage shocks. This transition is being supported by the establishment of an enhanced monetary targeting framework with strict limits on central net domestic assets to support money demand and disinflation, thereby limiting FX sales. These steps are complemented by a carefully sequenced easing of distortive FX restrictions, combined with prudent macroprudential policies to avoid currency mismatches.
"Building on the impressive ongoing efforts to deregulate the economy, the program seeks to deepen structural reforms to boost Argentina's growth, including via its vast potential in energy and mining. Efforts will focus on further (i) strengthening product and labor market flexibility, and gradually opening the economy; (ii) improving state efficiency and its regulatory predictability; and (iii) enhancing governance and transparency, including by further aligning anti-corruption and AML/CFT frameworks with international standards.
"Against the global backdrop of elevated and escalating risks, the authorities' have contingency plans in place, to be complemented by agile policy making in the context of program reviews to refine macroeconomic policies as needed to meet program objectives and durably restore stability. Clear communication will remain imperative, as well as the need for broadening the social and political support for Argentina's ambitious reform program."
