Leftist President Alberto Fernández of Argentina announced on Wednesday that he had asked American counterpart Joe Biden to act as “a bridge” with international finance organizations to help Argentina reach 2024 “with greater peace of mind” during their encounter in Washington.
“I asked the United States to continue accompanying us to the international credit organizations so that we can build that bridge that will allow us to get through this year with greater peace of mind,” Fernández said during a press conference in the Argentine embassy in Washington held shortly after his encounter with Biden.
Both presidents held a meeting on Wednesday. Their encounter had been originally scheduled for July but was postponed after Biden tested positive for coronavirus.
Fernández’s request comes the same week that an exhaustive study of Chinese rescue lending to countries that joined its Belt and Road infrastructure program found Argentina to have received more rescue funding from China than any other country.
Argentina currently owes the International Monetary Fund (IMF) $44 billion. The international organization is currently in talks with Argentine authorities to finalize a fourth review of its program that includes a flexibilization of the proposed foreign exchange reserve accumulation targets for 2023, as Argentina, whose foreign reserves are now at a $5 billion deficit, cannot comply with the current goals.
If reviews are successful, and agreed to by both parties, Argentina will then have access to about $5.3 billion, according to the IMF.
Argentina’s already precarious economic situation was worsened by a drought that recently ended. The drought, considered to be the worst of its kind in 60 years, caused losses of up to $15 billion to the country’s agriculture sector. In February, Argentina’s inflation rate reached 100 percent for the first time since 1990.
“I explained to Biden that the drought that Argentina is experiencing has meant a very strong restriction in its income,” Fernández said. “Therefore, we had to build a sort of bridge that would allow us to reach next year, where the possibilities of recovery of agricultural production, the greater development of Vaca Muerta — because we will already have the gas pipeline in operation and the gas liquefaction plant projects will surely be underway — opens a great opportunity for us.”
The Argentine president is seeking the prospective aid of the Biden administration regarding any revision to the requirements of the IMF debt agreement, as the United States holds veto power in the international organization.
Fernández’s request for help to president Joe Biden comes shortly after a recently released report shows that Argentina — which officially joined China’s predatory debt trap Belt and Road Initiative program in February 2022 — amply leads the list of countries that have received “rescue” funds from China. Argentina has received $111.8 billion in total from Chinese funds as of 2021.
In December, China agreed to provide Argentina with a $5 billion swap deal extension to help alleviate the Argentine Central Bank’s severe shortage of foreign reserves.
The Associated Press reported on Wednesday that Washington is increasingly concerned about China’s influence on Argentina and may seek concessions from the South American nation in exchange for its support at the IMF.
China has begun to exert an increased amount of pressure on Argentina and its notoriously pro-Chinese leftist government with the intention of taking control of some of the country’s strategic sectors. Among the most vulnerable is the Paraná-Paraguay waterway, a more than 3,400 kilometer long natural river transport that, in addition to being one of the most important water reserves in the world, would grant the communist regime significant leverage over a large part of the grain trade in South America.
“I think we have an enormous opportunity to increase our economic interchange, our economic integration, on everything from clean energy to critical minerals to technology to security,” Biden said on Wednesday.
During his press briefing at the Argentine embassy, Fernández was asked if he had discussed Argentina’s relationship with China during his meeting with Biden.
“I am not going to say what I talked about alone with President Biden, but I can say that I did not talk about it, none of those topics were touched upon,” he responded.
On Wednesday evening, Fernández, during an interview with the Argentine television channel C5N, asserted that the only comment made by Biden on China occurred in a “more general conversation.”
“He only said that he expects to compete on equal terms with China,” Fernández explained. “In some cases he sees it as a privileged competitor because many times State-State contracts avoid bids and then they lose there.”
Shortly before Fernández’s encounter with Biden, Argentine Economy Minister Sergio Massa, who traveled to the United States as part of Argentina’s official delegation, met with First Deputy Managing Director of the IMF Gita Gopinath before the IMF Board reviews its agreement with Argentina on Friday.
“In the context of the fourth program revision of the IMF, we had a good meeting with the Deputy Managing Director of the organization Gita Gopinath and her team,” Massa wrote in a social media post after the meeting, “with whom we analyzed the impact of the drought in the country and assessed the maturity clearance of the [Argentine] peso curve.”
“We both share the government’s decision to continue advancing with measures that promote the increase in exports with the aim of strengthening reserves,” he added.
Christian K. Caruzo is a Venezuelan writer and documents life under socialism. You can follow him on Twitter here.
COMMENTS
Please let us know if you're having issues with commenting.