Fiscal austerity, extractive industry expansion, and cuts to environmental protections are exacerbating Argentina’s social and climate vulnerabilities.
The International Monetary Fund (IMF) Spring Meetings will take place from Monday, April 13, to April 18, with Argentina once again facing macroeconomic fragility, growing social tensions, and doubts about the sustainability of its debt and the direction of the IMF’s recommendations for the country.
Fundación Ambiente y Recursos Naturales (FARN), Recourse, Espacio de Trabajo Fiscal para la Equidad (ETFE), and Equipo Transiciones have published this document, in which they analyze the country’s economic situation during these years under the IMF agreement.
The document explains that a new review of the current agreement between Argentina and the International Monetary Fund (IMF), signed in April 2025 under the Extended Fund Facility (EFF) program, will take place in the coming days. In this context, the country is awaiting the IMF’s technical assessment, and the disbursement of $1 billion has been delayed. The program has a duration of 48 months and a total amount of $20 billion, equivalent to 479% of the country’s quota in the organization.
The review of the agreement also comes amid social tensions: unemployment rose by 1.1 percentage points following the 2024 recession, informal employment reached 43% of the workforce, and real wages remain stagnant, according to INDEC data based on the fourth-quarter 2025 report. Fiscal and labor adjustment policies weaken state capacity and deepen inequality, while the extractive sectors advance without significant productive linkages or environmental oversight.
The organizations emphasize that after eight years of programs with the IMF (2018–2026), “the country has failed to stabilize its economy or regain access to capital markets.” The 2025 agreement, signed without the planned safeguards and debates, cements Argentina’s position as the IMF’s largest debtor, accounting for more than a third of its outstanding loans and highlighting the failure of previous programs (2018 Stand-By and 2022 Extended Fund Facility).
Julia Gerlo, a member of the research team at the Fundación Ambiente y Recursos Naturales (FARN), points out that one aspect often overlooked in the debate is the structural pressure that debt exerts on the environment and the climate. In this regard, she warns that the policies implemented under the agreement reinforce a growth model dependent on extractive sectors—energy, mining, and agribusiness—with low employment impact and high social and environmental costs. At the same time, there is a weakening of institutions that undermines the effectiveness of any public policy.
Furthermore, the document emphasizes that this is compounded by a fundamental problem: the 2018 and 2025 agreements with the IMF were approved without going through Congress, in violation of Law 27,612, and several of its provisions face legal challenges. This introduces an additional factor of uncertainty regarding its implementation and reflects institutional weakening that puts the agreement at risk of future legal challenges.
Fiscal austerity has reduced the environmental budget to a mere 0.033% of total spending, undermining the government’s ability to prevent wildfires, protect forests, or respond to climate emergencies. At the same time, reforms are being pushed forward—such as amendments to the Glacier Law—along with projects under the RIGI framework related to hydrocarbons and mining, which put strategic water reserves and fragile ecosystems at risk. This combination of extractive expansion and state retrenchment deepens vulnerability to the climate crisis and rules out any possibility of a just energy transition.
But the program’s tensions are not only economic, social, or environmental: they are also regulatory. Civil society warns that the agreement faces serious difficulties in complying with the IMF’s exceptional access policy. Federico Sibaja, an IMF specialist at Recourse, points out that the program’s basic conditions are not met: “the debt is unsustainable, there is no market access, and institutional weaknesses are evident.” Limited reserve accumulation, high debt maturities, and persistent reliance on exceptional financing reinforce this assessment.
The result is a program that seeks to stabilize without transforming: it cuts social spending, weakens state capacity, and deepens dependence on sectors that exacerbate the environmental crisis. Far from correcting structural imbalances, the plan appears to reinforce them. Francisco Cantamutto, an economist and member of the Fiscal Working Group for Equity (ETFE), warns that “failure to comply with the education financing law highlights an institutional weakening that threatens the predictability and effectiveness of public policies.”
In this context, “the debate unfolding in Washington goes beyond meeting fiscal targets or accumulating reserves. What is at stake is the direction of the development model: one that combines precarious stabilization, extractive dependence, and setbacks in environmental and social matters. Without a thorough review, the risk is not only that the program will fail to work, but that it will exacerbate the very vulnerabilities it claims to want to resolve,” the document states.
Furthermore, they emphasize that “after eight years of programs with the IMF, Argentina has not overcome the structural constraints that triggered the debt crisis; rather, it has exacerbated economic, social, and environmental imbalances that undermine its sustainability. The combination of fiscal austerity, dependence on extractive sectors, and institutional weakening has neither stabilized the economy nor improved living conditions, while eroding state capacities and increasing risks to the democratic system.”