Protests erupt in Argentina over IMF loan talks

Global Business

Protests erupt in Argentina over IMF loan talks

On Thursday night, there were protests in Buenos Aires outside Congress where lawmakers debated gas and electricity bill increases. But many here were also protesting the week’s shock news.

CGTN’s Joel Richards reports. 

“I have decided to start conversations with the International Monetary Fund,’ President Mauricio Macri announced on Tuesday.

Argentina is seeking credit from the IMF for the first time since the country’s economic crash 17 years ago.

“It is the cheapest finance we have available,’ Treasury Minister Nicolás Dujovne told a conference earlier this week. ‘The Fund loans at rates which are lower than the market, international rates have gone up.”

The Argentine government is requesting an IMF ‘stand-by’ credit line, reportedly $30 billion, as a preventative measure to steady the economy. This comes after a run on the peso which has lost nearly a quarter of its value against the dollar in the last 12 months.

But many Argentines blame the IMF for its role in implementing an austerity package in the 1990s which lead to widespread unemployment and pushed millions into poverty. It culminated in the devastating economic, political and social crisis of 2001-2002.

A widely-quoted survey this week found 75 percent of Argentines disapprove of the government going to the IMF. The survey showed a full two thirds of people who voted for Macri disapprove of the decision.

“When you ask for a credit, in this case a standby credit from the IMF, we know it comes with a series of strict measures, they don’t just give you the credit and you receive the money,” says Fernando Solanas, a Senator and filmmaker, whose first documentary focused on the 2001 crisis.

“It is greater fiscal austerity, closing the fiscal deficit which means reducing public spending, more job losses, less public works. So these are recessive and austerity programs.”

Mauricio Macri won the presidency in 2015 on the pro-business pledge to get Argentina’s economy in shape, and his government has pursued gradual shifts. But the unpopular decision to return to the IMF could lead to even more unpopular economic decisions.

Argentina turns to IMF in an unpopular move to lift the economy

CGTN’s Rachelle Akuffo spoke with the former Argentine ambassador to the U.S., Cecilia Nahon on Argentina’s struggling economy, and its rocky relations with IMF.