The Minister of Economy Martin Guzman landed this Thursday in New York – his first stop before traveling to Washington to meet with officials of the International Monetary Fund – but the climate that welcomes him on Wall Street is not the most favorable: Investors believe that the Government does not have much to offer and must first agree on a program with the Fund.
In the environment of finances in New York there are no details about which meetings the minister will hold. But, in addition, they view the visit with skepticism: “There is nothing to discuss” with Guzmán, he told Clarion Siobhan Morden, managing director de Amherst Pierpont. “There is no context for a productive meeting. What are you going to say? He will say: we don’t want a program with the IMF now because we don’t want to adjust rates, or prices, or the exchange rate, we don’t want to cut spending, we want to finance our deficit with the Central Bank…. ”
The expert concludes: “Productive meetings with investors will only occur when there is a commitment to a coherent program supported by the Fund ”.
Fernando Losada, managing director de Oppenheimer & Co, said to Clarion that, until now, they had not received an invitation to hold any meeting and pointed out that in the context of health measures “the feasibility of holding highly attended meetings in person with visitors is not clear.”
In this context, the financier warned that “the climate with respect to Argentina by international investors it is not the most favorable. Those who entered the swap last year and kept the bonds have lost a lot of money. “
In addition, he noted that “delays in reaching a new agreement with the IMF have resulted in the expectations of market participants losing their anchor. Investors will most likely ask the minister that defines a credible economic plan and that accelerates the negotiation with the Fund, although there is little hope that an agreement will be reached before October ”.
Consulted Alberto Bernal, strategist of XP Investments, noted that the message investors would want to send Guzmán is that “Without an agreement with the IMF the situation is not fixed, and that it is necessary to advance in that quickly ”.
He added that “it is very difficult to stabilize the exchange and monetary market if this prevailing level of uncertainty continues. An arrangement with the IMF would go a long way in generating certainty. Argentina needs investment, and without certainty that investment will not come.
Even before landing, Guzmán was greeted with a bucket of cold water by bondholders who entered the last debt swap in September. “Surprisingly, Minister Guzmán was not even kind enough to invite to his ‘meetings with investors’ in New York to the Exchange bondholders, who recently agreed to restructure for the second time, “the group of bondholders said on Twitter. Argentina Exchange Bondholders, conformado por distintos fondos, como HBK Investments, Monarch Alternative Capital, Paloma Partners Management, Pharo Management (UK), Redwood Capital Management y VR Capital Group.
Shortly before, the Coalition of Bondholders of the Province he had responded to the call made by President Alberto Fernández to sovereign investment funds, whom he asked to “turn their gaze on Argentina.” This group, which still has litigation with the province of Buenos Aires, responded through a tweet: “Good idea, but what if you start by respecting investors who have already invested in Argentina?”
In this climate, an official Guzmán agenda was not released in New York, where he lived for many years for his teaching position at Columbia University before being summoned to form part of the Alberto Fernández government. According to Economy sources, Guzmán has planned meetings with think tanks and investors, although they did not offer more details.
The minister will arrive in Washington on Sunday, where the highlight of his visit will be. Between Tuesday and Wednesday, he will meet with the managing director of the Fund, Kristalina Georgieva and the agency’s technicians, to continue negotiations for the $ 57 billion loan (44,000 disbursed) that the agency granted to Argentina in 2018.
The conversations, in which Julie Kozack, the vice director for the Western Hemisphere and the person in charge of the Argentine Staff, Luis Cubeddu, will also participate, aim to expedite the approval of an Extended Facilities loan, with longer maturities, but it is estimated that the government seeks to achieve it only after the October elections because the program includes structural reforms.
Guzmán will also meet with World Bank officials, and it is estimated that he could hold a meeting with Treasury technical officials from United States. For now, a meeting with the secretary Janet Yellen has not been confirmed.
Washington. Correspondent
