The Executive Board of the International Monetary Fund (IMF) approved on Thursday the release of $800 million to Argentina to support its economic recovery, stating that the loan program is "progressing smoothly."
Argentina has a $44 billion plan with the IMF, which includes targets for economic growth, inflation, and reserves. The IMF said in a statement that the Executive Board has completed the eighth review of the Extended Fund Facility.
"At the time of the review, the Executive Board assessed that the plan is progressing smoothly, and all quantitative performance criteria through the end of March 2024 have been exceeded," said the IMF.
To maintain this progress, improvements in the quality of fiscal adjustment, measures to strengthen the monetary and foreign exchange policy framework, and reforms to promote growth are needed.
The Argentine government stated that it would begin negotiations with the IMF for a new plan.
The IMF's approval comes after President Javier Milei took office in December, implementing extensive fiscal reforms with significant cuts to government spending to address triple-digit inflation, economic contraction, and heavily indebted reserves.
Under his leadership, these reforms have helped Argentina rebuild depleted foreign exchange reserves, achieve a fiscal surplus at the beginning of the year, and stabilize the peso currency.
Official data shows that Argentina's monthly inflation rate in May was the lowest since 2022, falling to 4.2% for the fifth consecutive month, a result of Milei's austerity measures.
Despite this, the government still faces challenges of economic stagnation and rising poverty levels. The IMF stated that Argentina will need to continue efforts to support vulnerable groups, expand political support, and ensure policy flexibility in the future.
