For Argentinian Delegation, Nation’s Rocky Financial Road Leads to Rome

National Catholic Register, 07 February 2020

 Argentina is a rich country that has made itself systematically poorer for a century, not due to war or natural disaster, but by generations of failed leadership.

It’s Argentina week at the Vatican.

While Argentinians still ask about when Pope Francis will make his first visit home, there is no doubt that he is paying close attention to the latest economic disaster to hit his country.

On Jan. 31, Argentina’s newly-elected president, Alberto Fernández, made his first visit to Pope Francis. That meeting produced a minor embarrassment when the Holy See Press Office released a statement that the Pope and president had discussed abortion. The president promptly said that they didn’t. The Holy See conceded that their original press statement was not accurate.

This week, the Pontifical Academy of Social Sciences, led by Argentinian Bishop Marcelo Sánchez Sorondo, hosted a seminar on international economics entitled “New Forms of Solidarity: Towards Fraternal Inclusion, Integration and Innovation.”

The Holy Father addressed the seminar himself, and participants included the head of the International Monetary Fund (IMF), Kristalina Georgieva, and Argentina’s new finance minister, Martín Guzmán.

 Argentina on the Brink

Those two held their first bilateral meeting while in Rome, as Argentina needs to restructure $100 billion in sovereign debt. In 2018, it required a $57-billion bailout from the IMF just to stay ahead of its creditors.

Argentina is in a steep recession — the economy is expected to shrink for the third straight year — and inflation is running at more than 50%. The kind of austerity measures usually required to pay back such high levels of debt are not feasible in Argentina. Either Argentina secures some sort of debt relief or forgiveness, or it will default.

Argentina is the great delinquent of sovereign finance, needing some 30 relief packages from the IMF over the years; the 2018 bailout was the largest ever in IMF history. Not that the bailouts have helped much; Argentina has defaulted on its sovereign debt an astonishing eight times, including the mammoth $100-billion default in 2001.

It is to be expected that the first Argentinian pope would give special attention to Argentina. Given that Cardinal Jorge Bergoglio had traveled minimally before his election as pope — he had never been to the United States, for example — it is the Argentinian economic experience that led him to his popular diagnosis that “this economy kills.”

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