Advisory panel appointed for Argentina; extension approved for SRF repayment Argentine request for extension approved

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To assist Argentina in its efforts to tackle an extremely difficult economic crisis and develop an effective recovery program, IMF Managing Director Horst Köhler announced the appointment of a panel of distinguished monetary policy advisors and IMF Executive Board approval of the country's request for an extension of a repayment to the IMF due later this month.

On July 10, Köhler indicated that, after close collaboration with the Argentine authorities,"we have been able to finalize the visit of a high-level group of persons to Argentina to advise about important aspects of monetary policy. The members of this panel will be Andrew Crockett, General Manager of the Bank for International Settlements; John Crow, former Governor of the Bank of Canada; Luis Angel Rojo, former Governor of the Bank of Spain; and Hans Tietmeyer, former President of the Deutsche Bundesbank."

The panel expects to be in Argentina on July 22-24 and will, Kohler said, advise "the Argentine government and [the IMF] on aspects crucial to the design of a monetary framework. This includes a monetary anchor to control inflation and other institutional aspects, including central bank independence. These are critical components of a strong and comprehensive stabilization program for Argentina."

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Köhler added that "we are very grateful that the distinguished members of the panel are able to make themselves available at very short notice for this task."The full text of News Brief 02/61 on the advisory panel is available on the IMF's website (www.imf.org).

Repayment postponed

On July 15, the IMF also announced that its Executive Board approved a request from Argentina for a oneyear extension on a repayment of SDR 741 million (about $985 million) due on July 17 under a Supplemental Reserve Facility (SRF) arrangement with the IMF. Financing for Argentina under the SRF had originally been approved as part of a Stand-By credit on January 12, 2001 (see IMF Survey, January 8, 2001) to ease a short-term financing constraint.

Repayment of an SRF is normally expected in two installments at one year and at one and a half years after the SRF disbursement, which in Argentina's case would be on July 17, 2002. A borrower may request an extension of up to one year of the expected repayment period under the SRF.An extension can be granted if repayment would cause undue hardship and if the borrower is taking actions to strengthen its balance of...