The Executive Board of the International Monetary Fund announced on Thursday the approval of the second review of Argentina’s 48-month Extended Fund Facility agreement, which was signed in 2025. Consequently, the nation is set to obtain approximately US$1 billion, which corresponds to 0.8 billion of Special Drawing Rights, the IMF’s international reserve asset. With these funds, 80% of the initially agreed US$20 billion has already been completed. Economy Minister Luis Caputo disseminated the information via social media and additionally uploaded the report compiled by the lender’s board. Last week, IMF spokesperson Julie Kozack confirmed during a press conference that IMF “board approval” this week would unlock the disbursement. IMF Managing Director Kristalina Georgieva issued an official statement on Thursday evening commending Argentine authorities for achieving “strong progress in stabilising and creating a more market-oriented economy under the Extended Fund Facility arrangement.”
The IMF chief stated that authorities were “committed” to maintaining fiscal balance through “further reductions in energy subsidies, improved targeting of social transfers, and containment in discretionary spending to offset the impact of congressional spending initiatives.” Georgieva noted that political uncertainty stemming from the 2025 elections has temporarily impacted growth, disinflation, and external stability. Subsequent adjustments, however, had led to a buildup in reserves, renewed disinflation, and improved market confidence, despite a more complex global backdrop. She stated that “the authorities remain committed to sustaining stability through a balanced policy package that supports disinflation while strengthening external sustainability and fostering growth, including to secure timely and durable international market access.”
On the monetary front, the IMF advised maintaining efforts to “support disinflation and enhanced exchange rate flexibility.” This would necessitate ‘continued efforts to strengthen central bank transparency and communication’, alongside initiatives aimed at further containing interest rate volatility to enhance monetary transmission and credit allocation. According to the organization, this “should be complemented by the implementation of a pronged financing strategy to restore timely and durable international market access, including to refinance large near-term public sector FX obligations and gradually reduce Fund exposure.” Simultaneously, it emphasised the necessity of enhancing regulatory and supervisory frameworks to facilitate the deepening of capital markets while mitigating financial vulnerabilities.
The IMF also noted that “progress in deregulating the economy and adopting reform legislation in the fiscal, trade, and labour areas have been impressive. Efforts must persist in fostering a more competitive and open economy, particularly by enhancing the predictability of tax and regulatory frameworks, to fully realise the potential of Argentina’s strategic sectors, including agriculture, energy, mining, and the knowledge economy. The statement concluded by noting that “against elevated external and domestic risks, agile policymaking and contingency planning remain essential to safeguarding program objectives.” And “Clear policy communication, along with well-targeted social support to alleviate near-term adjustment costs, will be essential for maintaining policy continuity and societal backing for Argentina’s reform agenda.”