The International Monetary Fund has officially approved Argentina’s request for $50 billion in support to stabilize its currency and pay its obligations. In exchange, Argentina has agreed to balance the primary budget (the budget excluding interest payments) by 2020 and give more independence to its central bank.
However, Argentina’s debt payment record is poor, and the political environment makes it difficult for the President to enact major reforms. The IMF must make sure Argentina actually balances the budget, including interest payments, and improves the rule of law before other installments of the loan are disbursed to guarantee lower inflation and a faster recovery.
Read the full op-ed in Economics 21 here.