World Bank willing to lend Argentina over US$2 billion for social programs

The World Bank is “ready” to lend Argentina more than US$2 billion, according to Carlos Felipe Jaramillo, the institution’s vice president for Latin America and the Caribbean. 

The announcement came Wednesday after the institution’s authorities met with Argentine Economy Minister Luis Caputo, who is in Washington DC for the 2024 International Monetary Fund / World Bank Group Annual Meetings. The potential loan is to be used for “social protection and education” programs and transportation and energy access for the country’s poorest, Jaramillo said in an X post.

Moreover, on October 13, the Inter-American Development Bank (IDB) president Ilan Goldfajn confirmed that the institution “expects to provide” Argentina US$3.8 billion in public sector loans and financing for private sector projects.

At the time of writing, the Economy Ministry has yet to officially confirm the World Bank or the IDB loans.

“A lasting transformation in Argentina will depend on a bold private sector that seizes these and other opportunities to create jobs and drive growth,” Goldfajn wrote in an article celebrating President Javier Milei’s economic measures published in The Financial Times called “Reforms can help Argentina break free of its history.”

The IDB will provide loans for both the public and the private sectors. US$2.4 billion will be allocated to “areas like spending efficiency, energy subsidies, and social protection” and US$1.4 billion to more than 20 private sector projects “in agribusiness, infrastructure, energy, and mining over the next two years.” Goldfajn exemplified this with “three lithium and copper operations across various provinces, especially in Salta.”

On Wednesday, Caputo received an award for being the “Finance Minister of the Year” from LatinFinance, a magazine on financial markets and economies of Latin America and the Caribbean. During the brief ceremony, he thanked Milei for changing history. 

“There is no doubt in our minds that this time Argentina will rise, and it will become the freest country in the world and the fastest growing economy,” he added.

The Economy Ministry did not confirm whether Caputo was meeting with authorities from the International Monetary Fund, the lender of last resort from whom the minister expects to renegotiate the country’s current program in order to obtain fresh funds.

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