Caputo’s meeting with Kristalina: with kind gestures but no “fresh funds” in sight

The managing director of the International Monetary Fund, Kristalina Georgieva, met this Thursday with the Minister of Economy Luis Caputo on the sidelines of the G20 summit in Rio de Janeiro, Brazil.

“We discussed the strong performance in the fight against inflation, fiscal consolidation and support for vulnerable people. We are committed to supporting the government’s efforts to turn the economy around for the benefit of people,” the head of the international organization said in a tweet after the meeting with Caputo, which she considered “constructive.”

The Minister of Economy retweeted Kristalina’s message thanking the Fund for its support, and went even further, praising the minister as the “best managing director of the IMF in history.”

Need for dollars

Luis Caputo, who brought the IMF in 2018 during Mauricio Macri’s government, has meetings scheduled with the US Treasury Secretary, Janet Yellen; the president of the World Bank, Ajay Banga, and with the head of the Inter-American Development Bank (IDB), Ilan Goldfajn, who was one of the participants in the last agreement with Argentina as director for the Western Hemisphere of the IMF.

The government is seeking “fresh funds” in a new agreement with the IMF that seeks US$10 billion in the face of a growing shortage of foreign currency. Moreover, it faces heavy debt maturities with private creditors at the beginning of 2025.

Milei’s expectations are focused on a victory by Republican candidate Donald Trump in the US executive elections this year, which would facilitate the disbursement of the organization where the northern country is the majority partner. He would not take office until January.

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Meanwhile, the IMF is pushing for the lifting of the currency controls and a devaluation of the peso to secure its own assets, given the government’s growing difficulty in accumulating reserves.

Nothing good can be expected from the IMF: poverty has doubled since it arrived and its prescriptions are leading us to a collapse of the economy; the same organisation predicts a 3.5% fall for this year. The sovereign’s disavowal of the external debt and a break with the IMF would allow the working class to put a stop to the debt drain and achieve a strong currency. Together with the establishment of a monopoly on foreign trade to put an end to the flight of foreign currency, the foundations can be laid for a democratically planned economy from below, which prioritises solving social needs and not the profitability of a small group of capitalists.