President Mauricio Macri asked for an early release of the loan worth $50 billion from the International Monetary Fund. IMF is concerned that the financial crisis in Argentina might cause failure to meet debt obligations in 2019.
The President said that in a televised press statement that the country agreed with the IMF in advancing all necessary funds that will make the next year's financial plan work. He said that the markets are losing trust in the Argentinian economy in the past week. He added that his decision aims at dismissing doubts. The amount and the date of release of the loan were not stated in the press release.
Argentina has been facing a financial crisis brought by the depreciation of its currency since earlier this year. The three-year financial debt will help support the country's weakening economy and the loan will be used in their struggle against inflation. The country is battling the highest inflation rate recorded globally at a 30 percent rate per year.
The Argentinian peso depreciated at a total of 40% when compared to the US dollar this year. The last depreciation of the Argentinian currency is its all-time low of 34.2 pesos for a US dollar.
The IMF stated that the loan would help revise the Argentinian government's economic plan. They added that the focus of the economic policies should be insulating their economy against sudden shifts in the global financial market. It should include tougher monetary and fiscal policies and much-focused efforts in protecting those who need it most.
According to Cristine Lagarde, the International Monetary Fund's managing director said in a statement that she is stressing her support for the country's policy efforts and the financial institution's preparedness to help the government in its plans of revision of its policies.
Business leaders are worried that the country won't be able to lose ends due to the countries heavy financial debts. The president, however, believes that the loan will help in Argentina's recovery and he did not plan to dispense the fund.
Some Argentinians, however, believe that the IMF caused the economic crisis that they are facing. They believe that the IMF guided the government's economic policies that worsened the financial crisis in 2001. The crisis brought high unemployment and poverty rate to the country. One out of five Argentinian were unemployed during those years.
The IMF has admitted that their internal audit unit concluded that they failed to provide oversight and they believed too much in the growth and the success of Argentina's economic reforms. The financial institution, however, continued to lend the country finances and it ended with the unsustainability of its economy.
