The World Bank has ruled out canceling Argentina’s debt and recommended it sign a deal with the IMF this year

The World Bank ruled out that countries like Argentina could benefit from debt relief like those promoted by the G20 among the poorest economies to avoid financial crises derived from the pandemic. The president of this body David Malpass, estimated that the country will need policies that encourage “growth and investment”.

During a press conference devoted to the World Bank’s relations with the countries of Latin America and the Caribbean, the highest official of this organization spoke of the loans granted to Argentina in the context of the health crisis. “We are working to provide USD 10 billion in aid to Latin America and part of that goes through social safety nets, ”said Malpass, and mentioned programs in Brazil, Bolivia Yes Argentina.

In this sense, the director of the region Carlos Felipe Jaramillo He highlighted the case of Argentina and Ecuador, for not having access to financing in international markets. “Their commitment to fund social transfers is so strong that they are redefining spending priorities, they know how important they are. We were also able to finance certain additional tranches of these programs so that they can fully realize them.“, He explained.

World Bank President David Malpass said the country will need policies that encourage growth and investment

Asked about the possibility of Debt forgiveness like the one promoted by international organizations for the poorest economies, said Malpass This policy does not apply to cases such as Argentina or Ecuador who do not have access to the international capital market.

“The central idea of ​​the G20 initiative It is aimed at the poorest countries in the world. Argentina faces specific challenges in restructuring its debt and also, I can say, in terms of policies as a nation to overcome the various debt crises, ”said the President of the World Bank.

“In fact,” he corrected, decades of debt crisis that tormented Argentina, then moving to a more stable environment with government policies that support growth and investment. These are significant challenges and in a way distinctive for Argentina because of the size of the debt, ”said Malpass.

“Ecuador is preparing for an election and recently carried out a debt restructuring which stabilized the situation. They also have a very efficient use of the US dollar and this avoids the problems that Argentina suffered for many decades from devaluation and high inflation ratesTherefore, Ecuador has a different climate and perspective that can allow for moving forward, beyond the debt restructuring itself ”, concluded the head of the body which depends on the Fund. international monetary policy.

For his part, Carlos Jaramillo said that “we all know that the situation in Argentina is difficult because of the debt and that it is very important that they can carry out a program with the IMF this year. And we are trying to see how we can help, ”said the World Bank director for Latin America and the Caribbean.

“I think the great tension is the great need to further increase investment in the economy and make it more competitive, and at the same time find non-inflationary financing, which is very difficult in this context. I think the private bond agreement was a very good first step that they took. And we are trying to see how we can support the World Bank, ”Jaramillo said.

World Bank Regional Director Carlos Jaramillo said that “we all know that the situation in Argentina is difficult because of the debt and that it is very important that they can succeed in carrying out a program with the IMF this year “.

“We have a program that is very focused on helping to improve its key services in the medium and long term, this will be important for water, health, urban transport and also social transfers for the most vulnerable population. I think this will absolutely be the key as Argentina’s economy continues. And we would also like to help with competitiveness and digital issues, ”the manager concluded.

As he could know Infobae, the government still aspires to reach a deal with the International Monetary Fund in May. According to official sources, negotiations with the organization are proceeding normally, beyond the fiery rhetoric of the president. Alberto Fernandez last week before the Legislative Assembly.

Minister of the Economy Martin guzman will make a short trip to Washington to meet the Director General of the Multilateral Organization, Kristalina Georgieva, and with the staff who lead the technical negotiation and will stay there a few days to seek a meeting with the new US Secretary of the Treasury Janet Yellen.

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