"It is clear that the IMF program has failed" | The C …

The diagnosis of the International Trade Union Confederation (ITUC) is overwhelming: the program of the International Monetary Fund (IMF) has failed but the authorities of the agency insist on the recipe book of adjustment that impacts workers and their rights. "Argentina has become another example of IMF programs that underestimate the adverse effects of austerity and the damage caused by these policies to both the economy and the workers," he said. said Sharan Burrow, General Secretary of the ITUC. . A report prepared by the union's technical teams warns that the Fund does not sufficiently take into account the viability of Argentina's external debt.

"The IMF has proposed an orthodox program of considerable fiscal consolidation, which is supposed to restore market confidence and solve economic problems. A year later, the economy is still in recession, unemployment is rising, inflation has not stabilized, debt sustainability has deteriorated and poverty continues to grow, "warns the report. the ITUC when it calls into question the erroneous forecasts of the agency. At the announcement of the Stand-By Agreement, the Fund projected that the Argentinian economy would increase by 1.5% in 2019. The latest projections published by the agency in July were based on a decline of 1.3%. The same gross "errors" of calculation are observed in the estimates of consumption and investment.

"Although initial projections badumed that austerity would have little or no impact on growth, this approach did not have the desired outcome. The Argentine economy has entered recession and projections have been adjusted downward, "says the CSI report, which also estimates that the agency's estimates for next year are unrealistic. "It is clear that the IMF program has not kept its promises. However, the IMF continues to focus on a harsh approach of austerity and put pressure on the government to achieve all its fiscal targets by making further cuts, "says the paper. prepared by the economists of the trade union confederation.

"Argentina's debt burden is increasing and the IMF does not adequately address concerns about the sustainability of Argentina's debt, which is exacerbated by the prolonged economic crisis," warns. the report, recalling the 2002 default. The IMF's badessment of the country's debt-related risks includes a contraction in GDP of up to 3.6% in 2020. The Fund's estimates indicate that such a recession accompanied by a new exchange rate and budget crisis jump would trigger the debt burden reaching 160% of GDP. Although the possible results deteriorate with each exercise, the technicians of the multilateral agency insist a year ago on the fact that "Argentina's debt is sustainable, but not with a high probability".

Referring to the high level of indebtedness and the inability of the program to regain "trust", CSI technicians recall that "Argentina has already broken its commitment to sovereign debt to the following a disastrous deal with the IMF that destroyed the economy. Even when the circumstances are now different, the absence of IMF debt sustainability measures and the deleterious effects of the lending program on the economy still remind us of the last agreement that failed. "

The Fund's authorities and representatives of the Argentinian government stressed from the beginning of the negotiations that the agreement envisaged the possibility of increasing public investment in the most vulnerable sectors. "Although the agreement contains a binding spending threshold for some social badistance programs, the apartment has been set at a level insufficient to truly protect the most vulnerable despite the difficulties. Despite this floor, in general, spending on social protection has been considerably reduced, "warns the ITUC report when alarm signals about the increase in poverty, the loss of power, Purchase and destruction of jobs. In this sense, Terrier of the ITUC states that "the IMF's discourse on the importance of social spending and the Sustainable Development Goals must be reflected substantially in the implementation of its lending programs, programs that continue to promote the same negative austerity of the past ".