IMF censures Argentina for flawed economic data

The International Monetary Fund (IMF) has censured Argentina for its flawed economic statistics, being the first time that the IMF has taken such action.

In a statement issued on Friday, the IMF said Argentina has breached the terms of its IMF membership agreement after the board of directors assessed a report from IMF Managing Director Christine Lagarde.

Argentina’s efforts to meet its obligation to improve the country’s inflation and gross domestic product (GDP) growth data have “not been sufficient” since September 2012, when the IMF board last met on the issue, the statement said.

“As a result, the Fund has issued a declaration of censure against Argentina in connection with its breach of obligation to the Fund under the Articles of Agreement,” the IMF statement added.

As Lagarde will report on the country’s progress to the board by November 13, the IMF asked the Argentine government to comply with its obligation by September 29.

“The Fund stands ready to continue its dialogue with the Argentine authorities to improve the quality” of the official data, the statement read.

The ordeal has brought unrest to Argentines who staged a general strike in November 2012 over a 25 percent inflation rate that comes contrary to the government’s published rate of 10.8 percent.

In September last year, Lagarde warned the government of getting a “red card” over failing to address the issue.

President Cristina Kirchner had received warnings after IMF’s external auditors figured out that the data provided since 2007 disagreed with the country’s actual economic status.

Actions after a censure may include restricted access to IMF credit line, the suspension of voting rights, or even exile from the group.