Amadeusz Juskowiak

Us treasury part of argentine bridge loan

The US Treasury said it was willing to participate with several other industrial countries in providing a 500 mlndlr shortterm bridge loan to Argentina

The Treasury announcecement did not name the other countries nor the amount of financing the United States was willing to supply

Argentina announced a wage and price freeze on Wednesday night and is negotiating with New York bankers for about 215 billion dlrs in new loans and other financing

Our willingness to participate in this multilateral shortterm financing indicates our support for Argentinas economic program to achieve sustainable growth and a viable balance of payments position the Treassury statement said

In announcing a fourmonth wage and price freeze Argentine officials said the country needed a more serene climate to carry out structural changes in the economy

But Argentina did not suspend interest payments on its foreign debts as neighboring Brazil did last week

The Treasury said the US share of bridge financing for Argentina would come from its Exchange Stabilization Fund

The onepage statement noted the International Monetary Fund expressed confidence in Argentinas economic policies and prospects by approving a new standby financing arrangement for it on February 18

Argentina is expected to qualify for IMF balanceofpayments financing which would enable Argentina to repay a multilateral bridge loan and support the implementation of its economic program the statement said

The latest Argentine action marked the second time in less than two years its government has used a wage and price freeze to restrain inflation

The debt talks in New York are being headed by Argentine Finance Minister Mario Brodersohn and are expected to last for several days

Along with new financing Argentina reportedly wants lower interest rates on an existing total 53 billion dlrs in foreign debt and elimination of foreign banks control over how some of the money is loaned in Argentina

Reuter