The Executive Board of the International Monetary Fund recently granted a $50 billion loan to Argentina, the largest loan in the history of the IMF.
Argentine President Mauricio Macri asked the IMF for several billion dollars in assistance last May because the peso was down by more than 32%, emerging markets were collapsing and the Argentine economy was alarming.
The IMF administration has provided $50 billion to revive Argentina over three years.The council's decision allows the authorities to immediately draw down $15 billion. $35 billion will be available throughout the three years, subject to quarterly reviews by the Board.
Otherwise, the interest rate will be 1.96% to 4.96%, depending on the quantity used. The country must repay each disbursement in eight quarterly instalments.
"Today's approval clearly demonstrates the international community's confidence in Argentina," said Christine Lagarde, Managing Director of the IMF.
According to the IMF, this aid for Argentina has four main objectives:
- Achieve a balanced financial position by 2020,
- Reduce inflation,
- Ensure that reforms do not have a negative impact on "vulnerable" Argentinians
- Alleviate tensions on the government's balance of payments.
The Argentine government intends to use the $15 billion and will treat the rest carefully.
According to the IMF head of mission, Argentina's economic growth will slow in 2018 but should recover properly next year.
Posted by : BUNKER GOLD&SILVER
Source: www.bloomberg.com