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Argentina’s economy minister, who renegotiated IMF debt, resigns

#Argentinas #economy #minister #renegotiated #IMF #debt #resigns

Argentina’s Economy Minister Martin Guzman, who led debt renegotiations with the International Monetary Fund, announced his resignation on Saturday in a statement shared on Twitter.

In his address to President Alberto Fernandez, Guzman did not say why he resigned, but called on the center-left leader to heal internal divisions so “the next minister does not suffer the same difficulties” as he did.

“It will be crucial that you work towards an agreement within the governing coalition,” he added.

His resignation comes two weeks after Vice President Cristina Kirchner, a former president who has consistently criticized the government, gave a speech attacking Fernandez’s economic leadership.

As economy minister, Guzman, 39, was tasked with renegotiating a $44 billion debt with the IMF that Argentina says it cannot repay.

The original debt of $57 billion — the last tranche Fernandez turned down after succeeding his Liberal predecessor Mauricio Macri, who asked for the loan — was the largest ever issued by the IMF.

Despite opposition from Kirchner, Guzman managed to reach an agreement and saved Argentina from default.

But Guzman often faced the hostility of the Peronist Judicialist Party, the largest force in the governing coalition, which counts both Fernandez and Kirchner among high-profile members.

Guzman said whoever will replace him will need “centralized management of the necessary macroeconomic policy tools to consolidate the progress made and address the challenges ahead.”

The agricultural powerhouse Argentina may be the third largest economy in Latin America, but it has been in an economic crisis for years, with inflation exceeding 60 percent in the last 12 months.

Even before the corona pandemic, the country was struggling with increasing poverty and a depreciating currency.

The IMF deal included provisions to curb inflation and reduce the budget deficit from 3 percent in 2021 to par by 2025.

Guzman’s detractors within the ruling coalition have attacked him for allegedly overzealousness in fighting the budget deficit and his monetary policies.

He has repeatedly complained that these criticisms send worrying signals to already nervous markets and make his job increasingly difficult.

In a recent report, Eurasia Group’s political risk consultancy said the internal divisions would not be resolved anytime soon.

“Infighting within the administration will continue to intensify and further impair the administration’s ability to develop a coherent policy plan,” Eurasia said.

Though he didn’t reveal what his next post would be, Guzman said he would “keep working and working for a more just, free and sovereign homeland.”

Fernandez has yet to comment on the resignation of one of his closest allies.

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