IMF says Argentina's request for 40% disbursement from new loan is 'reasonable'

By Andrea Shalal

WASHINGTON (Reuters) -The International Monetary Fund views Argentina's request for an initial 40% disbursement from the $20 billion new loan program it is negotiating with the global lender as "reasonable," IMF Managing Director Kristalina Georgieva told Reuters on Monday.

"It's a reasonable request. They've earned it, given their performance," Georgieva said in a Reuters NEXT Newsmaker interview, citing Argentina's efforts to finally tackle long-overdue economic reforms.

Georgieva said she expected the negotiations with Argentina to be completed before the upcoming IMF and World Bank spring meetings in Washington on April 21-26. Markets were watching the negotiations closely, she said.

Argentine Economy Minister Luis Caputo disclosed the request for a large first disbursement from the IMF program on Sunday.

Caputo said the South American country had eliminated the fiscal deficit and cut public spending, and the government was working to increase central bank reserves and begin unwinding foreign exchange restrictions that hinder business and investment.

"We've requested more because, traditionally, these are made in exchange for monetary and fiscal targets," Caputo said in remarks on television, adding that first disbursements were usually between 20% and 30%. "We've already done everything."

Georgieva said staff-level negotiations were still under way with Buenos Aires, but expressed confidence that a deal could be reached for a four-year program to follow the previous $44 billion lending arrangement signed in 2018.

Once a staff-level agreement is reached, it must still be approved by the IMF's executive board.

(Reporting by Andrea Shalal in Washington; Editing by Leslie Adler and Matthew Lewis)