Rene Alaniz

Eco 357L

"Argentina Expects to Reach IMF Accord By Aug. 15, but Washington is Skeptical"

The Wall Street Journal 07/25/84

Summary: This article is about the continuing financial crisis that has plagued the Argentinian economy. Argentina says that it can come to terms with the IMF before the August 15^th deadline. This has been met with growing U.S. skepticism as both sides may not come to agreement for months. Confusion has arisen as Argentina faces a 5.5 billion dollar interest due payment at the end of the year. The interest amount comes from the 45 billion dollar foreign debt owed to banks. This has come about as the IMF and Argentina battle over the austerity plan which will be forced as 300 million dollar loan comes due. This loan coming from its neighbors was for paying the interest that Argentina owed at the end of the 1^st quarter. This loan repayment will be lengthened if Argentina comes to terms with the IMF before the 15^th. All this has taken place as Secretary of State George Schultz and Argentine Foreign Minister Dante Caputo meet in an effort to win support for political plight of President Alfonsin. Argentina says that it has made some changes in the past few weeks so that an agreement can be made. Conditions such as lowering budget deficit to 8% to 9% of GNP by year end. Also widening trade surplus from 3.5 billion to 4. Yet the U.S. is still skeptical as it believes that Argentina is waiting for the IMF to make concessions.