Massa says Argentina will not use “one dollar” of reserves to pay off the IMF

Massa says Argentina will not use "one dollar" of reserves to pay off the IMF

BUENOS AIRES (Reuters) – Argentina’s Economy Minister Sergio Massa said on Monday that the country would not use “one dollar” of its own reserves to pay the $2.7 billion due to the International Monetary Fund this week.

Massa, who is also a presidential candidate in the October elections, said in a speech that it would be possible because of an extended swap agreement with China and a new loan from the Latin American Development Bank (CAF).

Massa confirmed that the repayment will be made with a $1 billion bridging loan from CAF and $1.7 billion coming from the second tranche of Mubadala with China, a move Buenos Aires recently made to complete part of its June payments to the International Monetary Fund.

Argentina, which is grappling with a severe economic crisis with soaring inflation and dwindling central bank reserves, needs to avoid default with the fund, with $2.6 billion due Monday and about $800 million due Tuesday.

“I want to bring you peace of mind – Argentina will not use a single dollar of its reserves to pay its due today,” Massa said in a televised address.

He added that the challenge facing Argentina now is to “continue to take care of (foreign currency) reserves while maintaining levels of economic activity.”

(Reporting by Eliana Raszewski and Gabriel Araujo; Editing by Bernadette Baume and Alexandre Villegas)

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