The International Monetary Fund’s board of directors approved a $50 billion credit line for Argentina on Wednesday, making it the largest loan in the institution’s history.
IMF board members voted in favor of the three-year stand-by arrangement, according to a statement by the Fund. The board’s decision allows Argentine authorities to immediately tap $15 billion, according to the statement. One-half of the amount, or $7.5 billion, will be used for budget support. The remaining amount of $35 billion will be made available over the duration of the arrangement, subject to quarterly reviews by the board.
Argentina’s government has indicated that they intend to draw on the first tranche of the arrangement but will treat the remainder as precautionary, the fund also said.
President Mauricio Macri sought the Fund’s aid in early May as the peso was in free fall, amid a selloff in emerging markets and concerns about Argentina’s economy. The peso is down more than 32 percent so far this year, among the worst performance in emerging markets.