IMF board completes third review of Argentina program

WASHINGTON (AP) — The executive board of the International Monetary Fund on Friday approved its third review of a $56 billion IMF-supported program for Argentina, giving the country access to an additional $11 billion.

That brings the total amount approved from the IMF since June 2018 to $39 billion.

Argentina has been hit by a sharp depreciation of the peso amid double-digit inflation.

IMF staff had given their go-ahead last month, but the executive board’s approval was still necessary.

IMF Managing Director Christine Lagarde said the program is generating results and there are signs of a gradual recovery because the recession has bottomed.

The IMF predicted in January that the Argentine economy would contract 1.7% this year.

However, Lagarde called on the Argentine authorities to exercise “continued prudence in the execution of spending plans and further steps to strengthen revenues” in order to reach the goal of bringing the fiscal position to a primary balance this year.

Argentine lawmakers approved in November an austerity budget for 2019 that aims to cut the primary deficit before debt payments to zero, down from 2.6% of GDP in 2018.

Lagarde also said more work is needed to address remaining gaps in the social safety net “to make social programs more effective in reducing poverty”.

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Luis Alonso Lugo on Twitter: http://www.twitter.com/luisalonsolugo