Thursday, January 21, 2016

US ends opposition to multilateral development bank loans to Argentina

The United States is ending its policy of opposing most lending to Argentina from multilateral development banks, the US Treasury Department said today.

US Treasury Secretary Jack Lew informed Argentine Finance Minister Alfonso Prat-Gay of the move on Thursday when the two met in Davos, Switzerland, the department said in a statement. It said the United States will consider each Argentinian project on its own merits.

The policy had been in place since 2011 as part of a larger US campaign to pressure Argentina to pay debts and other obligations to American investors a decade after the South American country defaulted on more than $81 billion of government bonds. It meant the U.S voted against new loans to Argentina at the World Bank and Inter-American Development Bank.

Argentina's center-right president, Mauricio Macri, has made swift reforms since taking office in December, including resuming talks to reach a deal over the unpaid debts with US hedge funds.

Macri also has eliminated capital controls and cut onerous export taxes.

Lew said the United States was ending it policy in light of the new government's "progress on key issues and positive economic policy trajectory," the Treasury statement said.