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Argentina needs market-oriented reforms

BUENOS AIRES, Argentina: International Monetary Fund (IMF) first deputy managing director, Gita Gopinath, made the following statement at the end of her visit to Buenos Aires, Argentina, on February 21-22, 2024:

“I had an excellent first visit to Buenos Aires. Over the past few days, I have been able to learn more about the progress being made but also the hardships the Argentine people are now facing. I heard first-hand from a wide range of stakeholders, who shared their ideas on how to address the country’s challenges and harness its vast potential.

“In my meetings with president, Javier Milei, and his economic team (chief of staff, Nicolas Posse, economy minister, Luis Caputo, and BCRA president, Santiago Bausili), I recognized the important efforts to restore macroeconomic stability through the establishment of a strong fiscal anchor. Initial actions are starting to bear fruit, although the path ahead remains challenging. Consistent and well-communicated monetary and FX policy will be necessary to continue to bring down inflation durably, rebuild reserves, and strengthen credibility.

“Given the near-term stabilization costs, sustained efforts to support vulnerable segments of the population and preserve the real value of social assistance and pensions are essential, as well as to ensure that the burden of the adjustment does not fall disproportionately on working families. Working pragmatically to build social and political support is also critical to ensure the durability and effectiveness of reforms.

“Similar messages were echoed in my discussions with academics, labor, civil society organizations, and private sector firms. There was broad recognition that Argentina needs market-oriented reforms to reverse a long-term decline in living standards, but that these should be designed and sequenced to ensure sustained and inclusive growth. Importantly, all concurred that Argentina has tremendous human potential as well as unique opportunities in energy, mining, and technology.

“My team and I look forward to continuing working closely with president Milei and his team to support their efforts to restore stability and strengthen growth for the benefit of all Argentines. I am grateful for the warm hospitality I received in my first visit to this beautiful country.”

IMF Communications Department



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