Bottoms up

Transcript of a Press conference
With Nicolas Eyzaguirre, Director; David Robinson, Deputy Director; Miguel Savastano, Gilbert Terrier, and Rodrigo Valdes, Senior Advisors, in the Western Hemisphere Department; and Andreas Adriano, Media Relations Officer, in the External Relations Department
Saturday, April 24, 2010

QUESTION: We know that you have been meeting with our Minister of Economy, Amado Boudou of Argentina. So I was wondering if you can tell us a little bit if there is any progress on the possibility of an Article IV. Yesterday or the day before, IMF First Deputy Managing Director John Lipsky told us that there were still some technical issues. I would like to know if this is concerning the statistics and if the IMF could provide any technical assistance in that regard.

MR. EYZAGUIRRE: Yes, we have been talking with Minister Boudou—it is always a pleasure to talk to him—and it is always good to be able to talk to the top economic authority and to see how things are going down there.

In fact, we have been talking about the possibility of a TA (Technical Assistance) mission, predominantly because INDEC has the intention to widen the coverage of the CPI from Buenos Aires to the national level. So, we have been talking about that for some time, and there has been quite encouraging progress on that point. Did you also ask about the Article IV?

QUESTION: Yes, whether there was any progress, because Mr. Lipsky told us that there was this technical problem.

MR. EYZAGUIRRE: Right. Well, you know, as many of the Ministers of the G20 have underscored—and that is also true for Fund surveillance—this crisis has dramatically showed that we live in just one world, and that the level of interdependence has been raised to unimaginable levels. Actually, if you look at the output levels in the last quarter of 2008, we have never seen in history such a correlation in the fall-down of every, or almost every country—in China also, the growth rates decelerated very sharply, even though they did not go into negative territory.

So that shows you in a nutshell that we all depend on each other. Therefore, in the G20 but also in the Fund, as I have repeated many times in these press conferences, the dialogue between countries is very important for every country. For countries to fine-tune what they have to do in their own domain, they need to have full knowledge of what the others are doing and what their prospective developments.

That is why most members favor an open dialogue of member countries with the Fund, especially for G20 countries, because the G20 countries are the ones that have a more systemic role. Thus, not having full information about policies and developments in a country that belongs to the group of systemic ones impairs to some extent the ability of the others to design their policies in the best possible way.

So it would be very good for Argentina and for the world community to reestablish the Article IV consultations. Minister Boudou was open to that. He said, I understand, that there is no rush for that, but he has not denied that avenue as a possible one.