## Press Briefing Transcript: Western Hemisphere Department, Spring Meetings 2026

_IMF News, April 18, 2026_

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## Bibliographic details
- Published: April 18, 2026

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### Regional outlook and context (opening remarks)
- Date: April 17, 2026.
- Pre-conflict assessment:
  - The Western Hemisphere "had started 2026 on a solid footing."
  - For most countries: growth close to potential, output gaps largely closed, inflation at target.
  - Export growth had been accelerating following adaptation to shifts in U.S. tariff policy.
  - Structural weakness: relatively weak productivity growth persistently limiting potential output.
- Impact of the Middle East war:
  - The scale and nature of impacts depend on the duration of the conflict and associated disruptions.
  - Differential regional effects:
    - Oil-producing countries likely to benefit from higher energy prices, but vulnerable households will be hit by higher energy and potentially food prices.
    - Tourism-dependent Caribbean economies: likely to be hardest hit due to high debt, small fiscal space, and large net energy importer status; uncertainty around tourism/flights is a key risk.
    - Central America: exposed through energy imports and, for some countries, "quite binding limits on the fiscal space."
  - Common consequence: higher inflation across all countries; greatest burden falls on lower-income families.
- Policy framework and institutional strength:
  - Many central banks in the region have well‑anchored inflation expectations and strengthened credibility over the past 20 years—this reduces the cost of re-anchoring inflation.
  - Monetary policy approach: central banks may prudently "wait and see" given uncertainty over shock amplitude/duration; some may need to raise policy rates or refrain from cuts depending on cyclical positions.
  - Fiscal priorities: avoid broad, untargeted subsidy re-introductions; preserve gains from replacing untargeted fuel/food subsidies with well-designed safety nets; fiscal support should be judicious and targeted to vulnerable families, farmers, and affected businesses.
- IMF support:
  - IMF role includes policy advice, capacity development, sharing cross-country insights, and deploying lending capacity.
  - Statement: "We are here to help all of our members."

### Country and subregion highlights, risks, and IMF engagement
- Venezuela:
  - IMF recognition of the government is a recent important development; staff engagement already in place.
  - A staff team exists (virtual engagement to date); diagnostics and rebuilding a comprehensive picture of the economy are immediate priorities.
  - IMF will deploy resources from multiple departments (Statistics, Fiscal, Monetary and Capital Markets) to assist.
  - Debt discussions and possible financial support are premature until diagnostics and capacity needs are assessed.
- Argentina:
  - Inflation: March inflation reached "3.44 percent" (highest in a year).
  - Recent policy actions and progress cited:
    - Budget passage and labor reform.
    - Central Bank accumulating reserves and announcing technical improvements in monetary operations.
    - Argentina has become an energy exporter.
    - Argentina issued a "$4 billion" bond earlier this year; spreads have declined to "around 400 basis points."
  - Financing strategy (multi-pronged):
    - Mobilize U.S. dollar financing from domestic markets.
    - Sale of state assets/privatization.
    - Central bank repos.
    - Loans from commercial banks guaranteed by multilateral development banks (World Bank, IDB).
  - Reserves target under program: authorities will accumulate net international reserves by at least "$8 billion" this year; central bank has already purchased "$6 billion" so far this year.
  - Staff-Level Agreement and Board process:
    - Team expects to go to Executive Board "sometime in early to mid-May."
    - Waivers (e.g., for failing to meet last year's reserves target) are decisions for the Executive Board.
  - Inflation expectations: 12-month ahead expectations are "around 25 percent."
- Ecuador:
  - IMF reached a Staff-Level Agreement at the end of March.
  - IMF Executive consideration of the Fifth Review expected "in the coming days."
  - Expected access: about "$400 million" upon completion of the review.
  - Program design highlights:
    - Primary goal: improve targeting of fiscal spending to protect the most vulnerable while creating space for productive public investment.
    - Subsidy reform: Ecuador removed fuel subsidies with accompanying social assistance; IMF view is to preserve these gains and use targeted fiscal channels to assist those most affected by higher energy prices.
  - Program implementation noted as instrumental in anchoring macroeconomic and financial stability.
- Caribbean and Small States (general):
  - Tourism-dependent islands, especially in the Caribbean, are highly vulnerable: high debt, small fiscal space, and net energy importers.
  - Policy guidance:
    - Some countries already use smoothing mechanisms for energy price increases; temporary smoothing can buy time but permanent untargeted subsidies are discouraged.
    - Preference for targeted measures to protect vulnerable households rather than broad subsidies.
  - St. Kitts and Nevis: IMF reiterates prior view that reintroducing or reforming income taxation (including progressive income tax) can increase fiscal space over the medium term; timing and design matter to avoid undue burden on lower-income households.
- Chile:
  - Government submitted a bill proposing tax cuts (e.g., corporate tax rate from "27 percent" to "23 percent"); IMF mission will assess details during a mission to Santiago later this month.
  - General IMF view: substantial permanent tax cuts should be offset by permanent revenue-raising or corresponding expenditure measures to maintain sustainability and adhere to the debt rule of keeping debt below "45 percent."
- Canada:
  - Demographics: falling birth rate noted (comparable to other advanced economies) and recent policy of slowing immigration; IMF does not see a current labor shortage in Canada.
  - Policy options to address slower population growth:
    - Well-calibrated, skills-based immigration with attention to absorption capacity (housing, schools, infrastructure) and effective integration/credential recognition.
    - Increase labor force participation (childcare, encouraging participation of older workers).
    - Raise labor productivity (reduce interprovincial frictions, improve innovation and technology adoption, infrastructure, competition reform).
  - Trade and resilience: tariffs on specific sectors (autos, soft lumber, steel) are unevenly affecting regions; IMF supports targeted fiscal support for regions/sectors facing adjustment.
- Mexico:
  - Bank of Mexico cut its benchmark interest rate to "6.75 percent" at its March meeting.
  - IMF assessment: the cut is not considered to pose risks given current conditions; however, the evolving inflationary environment from higher global energy prices warrants a "wait and see" approach and possible pausing of future rate cuts until greater clarity emerges.

### Analytical findings, projections, and numeric highlights
- Regional macro themes:
  - Pre-shock: growth close to potential, output gaps largely closed, inflation at target (general statement).
  - Shock impact: universally higher inflation; distributional losses concentrated on low-income households.
- Specific numeric figures and program targets mentioned:
  - Argentina: March inflation "3.44 percent"; inflation expectations 12-month ahead "around 25 percent"; central bank purchases so far this year "$6 billion"; reserves accumulation target this year "by at least $8 billion"; earlier bond issuance "$4 billion"; spreads "around 400 basis points"; Board timing "early to mid-May."
  - Ecuador: Fifth Review expected to provide access to "about $400 million."
  - Mexico: policy rate at "6.75 percent."
- IMF operational stance:
  - Staff teams in place for Venezuela and other engagements; IMF will deploy cross-departmental resources (Statistics, Fiscal, Monetary and Capital Markets) to assist members.

### Policy recommendations and priorities (summarized)
- Monetary policy:
  - Preserve central bank credibility and anchor inflation expectations.
  - Consider pragmatic "wait and see" approaches given uncertain external shock amplitude/duration; avoid premature loosening if inflationary pressures persist.
- Fiscal policy:
  - Resist broad, untargeted subsidy reintroductions; preserve reforms that replaced subsidies with targeted safety nets.
  - Use fiscal support judiciously and focus on vulnerable families, farmers, and businesses most affected by energy and food price shocks.
  - For permanent tax cuts (e.g., Chile), ensure offsets via revenue measures or expenditure adjustments to preserve debt sustainability (keep debt below "45 percent" where applicable).
- Structural and medium-term reforms:
  - Prioritize reforms that raise productivity (multiple reforms across labor markets, product markets, investment climate).
  - Improve fiscal institutional frameworks and credible anchors to increase resilience to shocks.
  - For small and tourism-dependent economies, build buffers and targeted social protection to shield vulnerable groups.
- Country-specific implementation notes:
  - Venezuela: immediate priority is diagnostics and capacity rebuilding before decisions on programmatic financing or debt restructuring.
  - Argentina: continue toward program completion at the Executive Board after pending technical measures are finalized; pursue multi-pronged financing strategy to rebuild reserves.
  - Ecuador: consolidate subsidy reform gains and target fiscal measures to protect the vulnerable while enabling public investment.

### Contact / press details (as provided in transcript)
- MEDIA RELATIONS — PRESS OFFICER: Julie Ziegler
  - Phone: +1 202 623-7100
  - Email: MEDIA@IMF.org
  - Twitter handle referenced: @IMFSpokesperson

*Press Briefing Transcript: Western Hemisphere Department, Spring Meetings 2026 — IMF Communications Department, April 17, 2026*

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_Source: https://www.imf.org/en/news/articles/2026/04/18/tr-04172026-press-briefing-transcript-western-hemisphere-department-spring-meetings-2026_