WASHINGTON, March 26 — The IMF executive board on Friday approved a US$44 billion (RM185.2 billion) loan for Argentina to help the inflation-wracked country’s economy, with US$9.7 billion of the funding available immediately.

The Washington-based crisis lender said the financing “aims to provide Argentina with balance of payments and budget support” and also “strengthen debt sustainability, tackle high inflation, boost reserves, address the country’s social and infrastructure gaps and promote inclusive growth.”

Argentina’s Senate last month had greenlit a deal with the International Monetary Fund to restructure US$45 billion in debt, the legacy of a record loan contracted in 2018 under former president Mauricio Macri.

IMF Managing Director Kristalina Georgieva noted the country struggles with both rapid price increases and low incomes.

“Against this backdrop, the authorities’ economic programme sets pragmatic and realistic objectives, along with credible policies to strengthen macroeconomic stability and begin to address Argentina’s deep-seated challenges,” she said in a statement.

However, she noted that “risks to the programme are exceptionally high, and spillovers from the war in Ukraine are already materializing.”

In 2018, under the government of centre-right Macri, the IMF approved its biggest-ever loan of US$57 billion to Argentina. The country received US$44 billion of that amount.

Macri’s successor, Alberto Fernandez, refused to accept the rest and sought to renegotiate repayment terms.

Payments of US$19 billion and US$20 billion were due this year — a timeline the government considered impossible.

Argentina is just emerging from three years of economic recession and battling a high poverty rate and rising inflation, which hit 50.9 per cent last year.

The programme is for 30 months and the financing comes under the IMF’s Extended Fund Facility, according to the lender’s statement. — AFP