Argentina delegation set to travel to US next week for IMF talks -source


By Jorge Otaola

BUENOS AIRES (Reuters) -The Argentine government will send a delegation next week to Washington in a bid to finalize the renegotiation of its $44 billion loan with the International Monetary Fund (IMF), a source involved in the talks told Reuters on Friday.

The delegation had initially planned to travel as early as June.

The third-largest economy in Latin America intends to change the scheduling of disbursements set for the rest of the year amid soaring inflation, a weakening peso, and a historic drought that has hindered agriculture exports and diminished central bank dollar reserves.

“The negotiation is fine, next week our team will be there (in Washington) all week. We are very close (to an agreement),” the source said on the condition of anonymity.

The fund said through a spokesperson that current discussions are focused on support for reserves accumulation and improving fiscal stability “while recognizing the impact of the drought.”

Grupo SBS said in a note that the renegotiation with the IMF rests on changing the exchange rate through a currency devaluation, but that “the government continues to refuse.”

In June, Argentina was forced to pay the IMF $2.7 billion in debt using the last reserves of its Special Drawing Rights (SDRs) and a Chinese yuan currency swap so as not to weaken its U.S. dollar reserves.

The government also this week postponed its $2.6 billion loan repayments for July until the end of the month, which include $1.3 billion that were due Friday.

Argentines in August will vote in a primary nominating contest, ahead of the general election in October.

(Reporting by Jorge Otaola, additional reporting by Rodrigo Campos in New York; Edited by Eliana Raszewski, David Gregorio and Rosalba O’Brien)

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