Argentina is in a stronger position to meet its debt obligations under President Javier Milei’s austerity policies, International Monetary Fund (IMF) Managing Director Kristalina Georgieva said on Monday. The country, the IMF’s largest debtor with $58 billion in outstanding loans, faces critical repayments starting next year as Milei seeks re-election.
IMF praises Milei’s economic reforms
Georgieva, the first IMF chief to visit Buenos Aires in eight years, credited Milei’s government and the Argentine people for restoring market confidence. Speaking alongside Economy Minister Luis Caputo, she said the question was no longer whether Argentina could service its debt but how sustainably it could do so.
“Argentina is in a much stronger position, and this is the result of the government’s hard work and the perseverance and sacrifice of the Argentine people,” Georgieva said. She noted the country’s debt was a key concern when she took office in 2019, but the outlook has since improved.
Economic indicators show recovery signs
Argentina’s economic metrics have rebounded under Milei, with annual inflation falling to 33% from 210% when he took office in late 2023. Bond prices have risen, central bank reserves have grown, and credit rating agencies—including Moody’s, S&P, and Fitch—have upgraded the country’s sovereign rating in recent months.
“What we have today is a much healthier picture,” Georgieva said. “Market confidence has returned.” She added that no additional IMF disbursements are expected before the 2027 presidential election, suggesting Argentina could break its cycle of reliance on the fund.
Challenges remain as Milei’s popularity wanes
Despite the economic progress, Milei’s approval ratings have declined amid weak consumer spending, stagnant wages, and rising household debt. Investors are watching whether his reforms will outlast his presidency, with key debt repayments looming in 2027.
Caputo has said the government plans to cover payments through multilateral lenders, privatization proceeds, and domestic borrowing rather than returning to international markets. Georgieva acknowledged the risks but urged continued policy strength to maintain confidence.
On Tuesday, Georgieva will visit Vaca Muerta, one of the world’s largest shale reserves, which is expected to become a major source of foreign-currency earnings for Argentina in the coming years.
