Argentina secures $500 million Saudi investment on food, energy

Riyadh: Argentina announced a $500 million investment Thursday from the Saudi Fund for Development, securing some rare international financing as the government seeks to contain an economic crisis.

The state-run Saudi fund is putting money into food and energy projects in the South American nation, including a gas pipeline that’s expected to be finished this year, according to an Argentine Economy Ministry statement, which didn’t detail exactly when the funds would arrive.

Economy Minister Sergio Massa met with the fund’s CEO, Sultan Abdulrahman Al Marshad, in Washington Thursday on the sidelines of the International Monetary Fund’s spring meetings. The outlay comes just two weeks after Argentine President Alberto Fernandez told US President Joe Biden in Washington that he’s seeking to secure a “bridge” of financing to offset losses from a severe drought.

While the Saudi investment isn’t enough to be a bridge on its own, it’s a rare instance of foreign backing in Argentina since the country lost access to international debt markets after it defaulted on private creditors in 2020.

Fernandez’s government is struggling to contain inflation of over 100 per cent as the economy is expected to go into recession this year, exacerbated by the worst drought on record slashing commodity exports almost in half.