May 23, 2013
IMF 'willing to cooperate' with Argentina on improving data quality
IMF spokesman Gerry Rice said today the international lender “is willing to cooperate with Argentina”, in an attempt to sweeten up the relations after last week’s cross fire between President Cristina Fernández de Kirchner and IMF Director Christine Legarde over the dubious data provided by the INDEC statistics agency.
“We are prompt to cooperate with the Argentine government“, Rice told reporters.
The new statements came after the IMF warned Argentina about its “lack of progress” in addressing inflation data and called on the country to implement “specific measures” within the next three months to improve it.
The IMF claimed the following action: “Improve the quality of the data reported over the Consumer Prices Index (IPC) and the GDP, so that the data turns consistent with the obligations stated by the IMF Constitutive Agreement.”
Tensions between the credit entity and Argentina started over year ago when the former accused Fernández’s administration of under-reporting its economic data.
Those concerns prompted the IMF to issue a 180-day warning to Buenos Aires on Feb. 1 now extended on 90 days- to bring the data in line with global standards or face the possibility of sanctions.
Initiating sanctions would be part of a gradual process that could range from public reprimand to eventual expulsion. Only the former Czechoslovakia has ever been thrown out of the IMF ranks, which occurred in 1954.
Some private economists have questioned whether Argentina has under reported inflation since 2007, while others have expressed increasing skepticism over the country's economic growth and industrial output figures.
Argentine economists began releasing their own inflation reports in 2007, after then-President Nestor Kirchner changed personnel at the national statistics institute in what he said was a bid to “improve operations.”
While President Fernández has constantly denied any data manipulation, in 2010 it was the very Head of State who asked the IMF to help create an index that would reflect current nationwide consumption habits.
The government has refused to let the IMF review its finances since 2006, when it paid off its 9.8 billion dollars debt to the lender. The Kirchner ruling couple blamed the IMF for pushing the country into a financial crisis that led to a 2001 default on 95 billion of bonds.