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The International Monetary Fund said on Tuesday that it had reached a preliminary, staffing level agreement with cash-trapped Argentina on a $ 20 billion bail, which offers a welcome postponement to Libertarian President Javier Milei because it wants to reverse the country’s old economic order.
As an agreement at staff level, the rescue package still requires final approval of the IMF Executive Council, which is expected to meet in the coming days.
The announcement of the fund offers a lifeline to President Milei, which has reduced inflation and stabilized the economy of Argentina with a free market agenda that reversed the reckless loans of its leftist populist predecessors.
The IMF has praised Milei’s success in reducing the fiscal deficit of Argentina, but has held a new loan to the country the largest debtor, with 22 IMF loans that have been distributed since 1958.
To effect the first fiscal surplus in Argentina in nearly two decades, Milei government agencies eliminated, fired thousands of public employees and scrapped subsidies and price management measures. But without cash from the international money shooter, he was unable to rebuild the rapidly exhausting foreign exchange of Argentina, which he needed to repay debt and lift the country’s long -standing strict currency controls.
Currency controls prevent companies from sending profits abroad, which discourages foreign investment.
“The agreement builds on the impressive early progress of the authorities with the stabilization of the economy,” the IMF said in a statement in which the agreement was announced on the loan under a 48-month arrangement.
There was no immediate response from the Argentine authorities that have been negotiating the agreement for months.
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