Argentine and Brazilian Presidents Coordinate, So the IMF ‘Can’t Be Allowed To Asphyxiate Argentina’
April 14, 2023, 2022 (EIRNS)—In a well-crafted flanking move, undoubtedly coordinated with his Brazilian counterpart, Argentine President Alberto Fernández said, in a speech before the Industrial Design and Innovation Exhibition in Buenos Aires yesterday that “the IMF will not asphyxiate us, we cannot allow it to asphyxiate us.” He was referring to remarks that “my dear friend” Brazilian President Lula da Silva, had made the same day in Shanghai to officials of the BRICS New Development Bank, in which Lula denounced the IMF for “asphyxiating Argentina, and holding a knife to its neck.”
Fernández reported he’d spoken with Lula by phone a week earlier, adding that yesterday he had read about his remarks on Argentina in Shanghai, at the investiture of Dilma Rousseff as the new president of the BRICS New Development Bank. “Thank you Lula,” he said. “I’ve told the IMF this a thousand times, but your words will help them understand it more.... They will not asphyxiate us. We cannot allow them to asphyxiate us, especially given what we are living through today.” The Argentine President added that he fully supported Lula’s presentation to the NDB officials, according to the A24.com website.
Fernández also said that in his phone call, he had given Lula a detailed report on the severity of Argentina’s economic crisis, including the effects of the worst drought since 1929, which has devastated key export crops such as soy and corn, causing losses of between $17-$20 billion in revenue. This, in turn, has affected the government’s ability to accumulate foreign reserves, to pay for needed imports, and to implement the terms of the current onerous Extended Fund Facility with the IMF. That’s why Finance Minister Sergio Massa is currently at the spring annual IMF meeting in Washington seeking to renegotiate the terms of the $45 billion agreement, in order to ease conditionalities, Fernández reported.
The government has no intention of “printing money like crazy” or taking other extreme action, Fernández said, adding he understands efforts must be made to lower deficits and be fiscally responsible. But, he warned, the government will not abdicate its responsibility to protect its citizens, provide them with healthcare, job opportunities, and aid the unemployed. “We will not renounce” the idea of a strong state, as neoliberals demand, he said, despite the crisis.
The IMF’s response? At a press conference yesterday, IMF Managing Director Kristalina Georgieva dispelled any idea that the Fund intended to “go easy” on Argentina. With the usual doubletalk, she said she knew how hard the Fernández government had tried to adopt “prudent management” and comply with the goals of the current agreement, and that the effect of the drought has “complicated” the work of politicians. That’s why, she explained, the Fund has generously decided to lower by $2 billion the amount of reserves that the government must keep on hand.
The final message, however, was that the Fund’s program must be implemented with austerity conditionalities and all. “We know that we have the government’s commitment to keep refining policies in light of existing conditions,” Georgieva said. But in the end, the “program’s success relies on implementation, and implementation continues to be most important, even in these challenging circumstances.”
In other words: shut up and do as you’re told.