As of August 31, 2023, Argentina’s central bank has only US$28 billion in reserves left. This is down from US$44.6 billion at the start of the year.
Argentina is preparing for elections on October 22. Economy Minister Sergio Massa is the ruling party’s candidate.
Current President Alberto Fernández won’t run again.
The highest reserves were US$77.4 billion in 2019. This was under former Presidentif Mauricio Macri.
Macri got a US$57 billion loan from the IMF as president. He left office with US$39.4 billion in reserves.
Macri had taken over in 2016 with nearly the same amount, US$39.3 billion.
In 2022, under Fernández, the IMF approved a US$44 billion loan to Argentina. This loan let Argentina extend the debt they first got in 2018.
In July, Argentina said it won’t use dollars to pay a US$2.7 billion debt to the IMF.
The Economy Minister said they’d use a loan from the Andean Development Corporation and Chinese yuan instead.
These changes make Argentina’s finances a hot topic, especially with the upcoming elections.
Argentina has faced multiple financial crises over the years. 2001 the country defaulted on debt, triggering a severe economic downturn.
Cristina Kirchner, who led the country from 2007 to 2015, implemented populist policies. She left behind a struggling economy.
Mauricio Macri followed Kirchner and tried to implement market-friendly reforms. However, these reforms didn’t work as expected, leading to more debt.
Argentina has been dependent on IMF loans to stabilize its economy. Yet, these loans often come with strict conditions, which are controversial.
These conditions require Argentina to make budget cuts, raising public concern.
Given this history, the country’s currency reserves and debt are key issues in the upcoming election.