Congress Supports Milei’s Decree for New IMF Agreement in Argentina

Argentina’s Congress has endorsed President Javier Milei’s decree for a new IMF deal, allowing negotiations to advance. The vote passed with 129 in favor and 108 against. With economic conditions deteriorating, concerns over currency policy and protests continue to rise, as details on the new agreement remain scarce.

On Wednesday, Argentina’s lower house of Congress ratified President Javier Milei’s emergency executive decree, endorsing a new agreement with the International Monetary Fund (IMF). The Chamber of Deputies cast a vote of 129 in favor, 108 against, with six abstentions, thereby formally enacting the decree without requiring approval from both chambers.

This significant step enables Argentina to proceed with negotiations for a new IMF program, which is crucial for the country’s financial stability. However, many details surrounding the agreement remain undisclosed. Currently, anticipations regarding a shift in currency policy under this new program have intensified, resulting in the Argentine peso reaching its lowest value in over five months in the parallel market this week.

In an effort to mitigate market concerns, Economy Minister Luis Caputo addressed local media, although he refrained from discussing future policy changes. Amid the congressional debate, protesters gathered outside, including retirees who have been demonstrating against insufficient pensions; these protests escalated last week with participation from aggressive football fans.

Milei’s administration contends that the new IMF program will be utilized to reduce the Central Bank’s debts to the Treasury, thus claiming it will alleviate the country’s overall debt burden. They assert that the severe economic conditions justify this decree-based borrowing method, bypassing the need for complete congressional approval. Argentina stands as the largest debtor to the IMF, and this upcoming deal will mark the 23rd agreement with the organization, a record for any nation.

In conclusion, the approval of President Milei’s decree to support a new IMF agreement is a critical legislative milestone for Argentina. It reflects the government’s efforts to stabilize the economy amid mounting protests and significant currency depreciation. Nevertheless, the lingering uncertainty regarding specific program details and policy changes necessitates careful monitoring as negotiations proceed with the IMF.

Original Source: batimes.com.ar