Transcript

Transcript of Press Briefing by Thomas C. Dawson, Director, IMF External Relations Department

April 30, 2002

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MR. DAWSON: Good morning. I'm Tom Dawson, Director of External Relations at the IMF, and this is another of our regular press briefings. As usual, we'll embargo the briefing until 15 minutes after its conclusion, and we'll set a precise time at that point.

I have no particular announcements to make today, but I would note, although this will have the effect of depressing attendance, that the briefings are permanently archived on the Fund's external website and can be viewed there. The links to the archived webcasts are attached to the transcripts of the briefings, which can be found by clicking on the `News Releases' link on the home page and then the `Transcripts' link under News Releases.

I'd be curious to see how many people actually watch, take a look at this. It sounds to me more like Groundhog Day than an advance in technology.

QUESTION: Any news on Argentina? Did Krueger speak to Lavagna yesterday, or is she planning to today? And did Köhler speak to him yesterday, or is he planning to today or at any point?

MR. DAWSON: Good. Okay. We are encouraged that the 14-point plan signed by the President and provincial governors last weeks demonstrated broad political support for our comprehensive approach to dealing with Argentina's difficult economic situation. On Monday, yesterday, Minister Lavagna spoke with the First Deputy Managing Director Anne Krueger at length and assured her of his strong commitment to moving quickly to develop this plan into a consistent and sustainable program.

We are looking forward to working with Minister Lavagna on the development of a strong economic program. We are ready to send technical teams to Buenos Aires at the appropriate moment. Assuming good progress is made in putting in place the key elements of a program, a full mission could then return to Buenos Aires to continue the negotiations.

Of course, the situation does remain volatile, the risks are large, and it's essential that the new team move fast and decisively to put in place the foundations for the program.

Then I guess there was also the question of a conversation between the Managing Director and Mr. Lavagna. There was no such conversation. I think you need to be a little skeptical about, you know, reports on those sorts of things. We will tend here to let you know when one has taken place.

QUESTION: When do you think this appropriate moment is going to be? You had said that you're going to send a negotiating mission to Buenos Aires after the Spring Meetings, and then you said maybe in May. do you have any date calculated or--

MR. DAWSON: Well, of course, since that point we have a new Minister and this new 14-point plan. I think at this point the action is very much with the authorities in developing the implementation of this plan, which, as I noted, you know, has some very encouraging elements.

We are in touch with them. You know, as I say, the sequencing is likely to be a technical mission or two prior, and then a negotiating mission. I can't give you an estimate as to when it will be because it is, of course, contingent on the progress that they make, asking us to come down and so on. But it is something that I think is very much on track. I can't say that the negotiating mission will be in May, but it is still possible.

QUESTION: Does the resignation of Remes Lenicov change the schedule?

MR. DAWSON: Well, I mean, it's hard to tell. We didn't have a schedule per se. We had sort of a time line that we were hoping to meet. And I think that while one might think that would make a difference, on the other hand, now we have the 14-point plan, which, as I say, has some pretty specific elements to it. So I don't think that necessarily changes a possible time line, but we didn't have a fixed--we did not have a fixed schedule to begin with.

QUESTION: As I understood it, before, there was going to be just a negotiating mission that was going to go down next, and now--

MR. DAWSON: No, no.

QUESTION: --there's two technical missions that were added?

MR. DAWSON: Not true at all. Negotiating missions come and go all the time--I mean, technical missions come and go all the time. So that's not necessarily the case. You can send one down with or without. But I think--I guess what I should say--and, frankly, there's some indications they may want some technical missions. That's very much their call. It's also their call to indicate when they're ready for an negotiating mission. So it's not an issue of our raising barriers or anything like that. It's just a matter of what useful work can be done.

Again, to repeat, the 14-point plan has a number of elements in it that are quite interesting, and I think, you know, if they wish to have Fund technical teams down there very quickly to work on them, you know, we will try to accommodate that.

Not an Argentina question, I bet.

QUESTION: Umit Enginsoy with Turkish NTV Television. I was wondering when the next IMF mission will be going to Turkey. And, secondly, it seems Turkey has been a little bit slow in keeping a few promises to be complete by the end of April, just time-wise, one week, or just sometimes there is delays. Does it have any effect on the IMF mission?

MR. DAWSON: We still expect the second review mission to visit Ankara in mid-May. So we are--in that sense we are still on track. And I note, for example, a further decline in Turkish interest rates this morning, so I think, broadly speaking, you know, we believe that we are on track. I wouldn't read too much into delays in implementing or passing individual measures, as long as the trend is correct. So we are still expecting a mid-May second review mission.

QUESTION: Back to Argentina. There were two different ideas that came from the President's office there this past week, and they may or may not have been lost since then or forgotten since then. One is fixing the peso again with some kind of peg, and the second is that Argentina wouldn't be able to afford to pay the World Bank and the IMF back unless there was a new Fund program for them.

What's the Fund's thinking on those if they were to resurface again in the future?

MR. DAWSON: Well, I would note that point 1 of the 14 points is to honor agreements with multilateral lenders, so I think that's a rather hypothetical question that you ask.

With regard to the exchange rate approach, we indeed believe that there's been a renewed commitment on their part to a floating rate policy, which we feel remains the most appropriate approach in current circumstances. The best way to avoid overshooting is not to intervene in the market but, rather, to ensure that the overall policy framework is consistent with stabilizing expectations and the restoration of confidence.

QUESTION: Can you just--sorry, I didn't catch the end of that. The best approach is not to intervene, did you say?

MR. DAWSON: Not to intervene in the market but, rather, to ensure that the overall policy framework is consistent with stabilizing expectations and the restoration of confidence.

QUESTION: Is there any other guidance that you can give us on the phone conversation yesterday with Ms. Krueger about--specifically, it seems like you say that technical missions are headed down there. Are we talking about this week or--

MR. DAWSON: I don't have a specific one on that. I mean, it would not surprise me because it's only Tuesday, so that would not surprise me.

I wouldn't want you to think that the First Deputy Managing Director and the Minister were talking about the timing of the sending of technical missions. That's, not surprisingly, a technical question and that's something that's handled more, for example, between the Argentine Executive Director here and Fund staff and staff in Argentina. So that the discussion was an initial discussion between the two of them, but as I think I said--and certainly it's written down here for me to say it if I didn't say it--it was a lengthy conversation, so I think they covered a great deal of territory, and I think it was a good conversation.

QUESTION: Argentina is talking about bridge loans so that they can make the repayments.

MR. DAWSON: I'm not aware of that.

QUESTION: They said that yesterday.

MR. DAWSON: I am not aware of that. Who would the bridge loan be from?

QUESTION: I don't know. But would that be a good idea if that's what they--

MR. DAWSON: I mean, I think we take them on their word, what they have told us, which is that they intend to honor their agreements with the multilateral lenders.

QUESTION: How much do they owe?

MR. DAWSON: Actually, I do have that, as a matter of fact. Let's see. The outstanding is approximately 11.95 billion SDR. You multiply that by 1.27.

QUESTION: [Inaudible]

MR. DAWSON: Total. No, that's the total outstanding. If we want to return for a little bit of a primer, when you see these stories about $20 billion IMF package, et cetera, et cetera, you always need to go back and look at it. Was it the size of the total program? How much was actually ever disbursed? Et cetera, et cetera, because you can get some very, very large numbers that don't reflect the actual situation, although, of course, now in our new and transparent Fund, you can just click on the website and get the number down to the last decimal point, including, you know, broadly speaking, pretty good information on the repayment schedule as well.

Okay? I think we ought to cut it out. You've had several chances.

QUESTION: Just to help us, those of us who need a little guidance, on the repayment schedule can you tell us how much is coming due this year for Argentina?

MR. DAWSON: Forthcoming in this calendar--the remainder of this calendar year, including interest--because that first number did not include interest; the first number was principal only. Including interest, approximately 3.8 billion SDR.

Okay? All right. Thank you very much. We'll lift the embargo at 10 o'clock.