NEW YORK, Oct 29 (Reuters) – A former official at the International Monetary Fund said Argentina is “not going to pay” the Fund and any agreement between the two will be a “temporary Band-Aid” that will only delay a run on banks in the South American country.
“Argentina is not going to pay the IMF. Argentina is not going to do good macro-micro institutional policies,” said Alejandro Werner, who was the head of the IMF’s Western Hemisphere Department for nearly a decade before he left in August.
The IMF had no comment and the Argentine government did not respond to requests for comment.
Argentina is negotiating a program to replace a failed one from 2018 that left it as the Fund’s largest debtor by far, with about $45 billion in payments due. If the current deal is not modified, payments of near $19 billion are due next year.
Werner, speaking at an event on the economic future of Latin America hosted by the Official Monetary and Financial Institutions Forum on Thursday, said, “we’re overplaying the IMF program, because at most it’s going to be a temporary Band-Aid to hold the expectations and delay the run on banks for four months. Then everything will play out because you look at these guys … What are you going to expect from this government?”