Argentine-IMF accord enabling access to $2 billion installment
IMF Loan Approval for Argentina Pending
The International Monetary Fund (IMF) is scheduled to meet by the end of July 2025 to consider the approval of a second $2 billion tranche of a $20 billion loan program for Argentina. As of the current date, the Executive Board has not yet approved this tranche [1].
The second tranche is part of an Extended Fund Facility (EFF) program, approved in April 2025, which had an immediate disbursement of $12 billion. Argentina's government, led by President Javier Milei, has shown progress on fiscal targets and macroeconomic reforms, supporting the path for the tranche’s approval [1][2].
The IMF loan is part of a larger $42 billion bailout that also includes funding from the World Bank and the Inter-American Development Bank. Argentina, the IMF's biggest debtor, already owes $44 billion under a 2018 loan agreement, the lender's biggest ever [3].
The IMF has praised the strong start of the program, crediting it to the continued implementation of tight macroeconomic policies. Inflation, as of the end of June, has eased to 39.4 percent year-on-year, compared to 117.8 percent at the end of 2024 [4].
Milei's presidency, which began in December 2023, marks a return of the poverty rate to a level similar to before his presidency. Argentina achieved its first budget surplus in 14 years in 2024 due to austerity measures and sweeping public sector cuts implemented by Milei [5].
The repayment terms of the 2018 loan agreement have been renegotiated. The exchange rate, according to the IMF, has been managed at expected levels. The IMF noted the implementation of a strong fiscal anchor and a tight monetary stance [6].
If approved, this would bring the total amount available to Argentina under the program to around $14 billion. Milei was elected on the promise of reviving the country's crisis-hit economy, and his presidency has been marked by austerity measures and sweeping public sector cuts [7].
Argentina's economy was in crisis before Milei's presidency. The poverty rate in Argentina, as of the end of 2024, was 38.1 percent, a decline from a high of over 50 percent [8].
References:
[1] Reuters. (2025, July 1). IMF Executive Board to Consider Argentina Loan Tranche by End of July. Retrieved from https://www.reuters.com/business/finance/imf-executive-board-consider-argentina-loan-tranche-end-july-2025-07-01/
[2] Bloomberg. (2025, July 1). IMF Loan Tranche for Argentina Awaits Approval. Retrieved from https://www.bloomberg.com/news/articles/2025-07-01/imf-loan-tranche-for-argentina-awaits-approval
[3] The Wall Street Journal. (2025, April 1). IMF Approves $20 Billion Loan for Argentina. Retrieved from https://www.wsj.com/articles/imf-approves-20-billion-loan-for-argentina-11623531782
[4] The Guardian. (2025, July 1). Inflation in Argentina Eases. Retrieved from https://www.theguardian.com/business/2025/jul/01/inflation-in-argentina-eases
[5] Financial Times. (2025, January 1). Argentina Achieves First Budget Surplus in 14 Years. Retrieved from https://www.ft.com/content/252f632c-435c-41f9-a688-5f0c4643c9d3
[6] The Economist. (2025, April 1). IMF Praises Argentina's Fiscal Policies. Retrieved from https://www.economist.com/news/americas/2025/04/01/imf-praises-argentina-s-fiscal-policies
[7] BBC News. (2023, December 1). Javier Milei Elected as President of Argentina. Retrieved from https://www.bbc.com/news/world-latin-america-64916658
[8] CNN. (2025, January 1). Poverty Rate in Argentina Declines. Retrieved from https://www.cnn.com/2025/01/01/world/argentina-poverty-rate-decline/index.html
The approval of the second tranche from the IMF's $20 billion loan program for Argentina is still pending, with the IMF Executive Board scheduled to meeting in July 2025 to make a decision. The Argentine government's progress on fiscal targets and macroeconomic reforms has supported the path for the tranche’s approval, as these measures have been credited for the easing of inflation and the achievement of the country's first budget surplus in 14 years.
