Group of Argentine creditors criticizes ‘erratic’ economic policy, warns of delays in IMF deals By Reuters

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© Reuters. Outbreak of the coronavirus disease (COVID-19), in Buenos Aires

BUENOS AIRES (Reuters) – A group of top Argentine creditors has criticized the South American country for “erratic” economic policies that it says are hurting growth and weighing on bond prices five months after the government restructured some $ 65 billion. in external debt. Bondholder group Exchange, involved in the restructuring that cured Argentina’s ninth sovereign default, added it was concerned that talks with the International Monetary Fund on a new deal were “subordinate to politics.” “An IMF program is the only likely source of policy anchors and a credible medium-term framework that can bring stability,” he said. “However, the government appears to be seriously contemplating delaying an agreement with the IMF in order to have the freedom to continue its unsustainable policies.” Argentina is currently in talks about a new IMF program to replace a failed facility from 2018, of which the country has already received some $ 44 billion that it cannot repay. This agreement is considered key to strengthening the economic position of the country. The government has said it wants to reach a deal by May, a goal the IMF says is ambitious but achievable. However, creditors and analysts say there is mounting pressure from the ruling Peronist coalition to delay the deal until after midterm elections in October. The Argentine government did not immediately respond to a request for comment. The Exchange group cited policies including price freezes, grain market interventions and capital controls as issues that were “short-term palliative that are destined to fail and only accumulate bigger problems down the road.” “Erratic and ad hoc policymaking amid a growing list of policy mistakes and U-turns … all erode trust,” he said.

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