WASHINGTON — The Board of Executive Directors of the Inter-American Development Bank (IDB) approved $750 million in financing to support fiscal stability in the provinces of Argentina through improved efficiency of public spending and revenue collection.
The operation is the first phase of a $1.5 billion conditional credit line for investment projects (CCLIP) designed to advance fiscal coordination in Argentina. The program seeks to strengthen institutional frameworks and improve fiscal performance incentives for provincial governments, supporting greater fiscal sustainability.
“This operation directly supports one of the key priorities of the IDB Group’s 2025–2028 Country Strategy for Argentina: strengthening fiscal sustainability and improving the efficiency of public spending,” said Viviana Alva Hart, IDB Group Country Representative in Argentina. “By working with provincial governments to strengthen fiscal management and own-source revenue collection, we are helping build stronger institutional capacities and more efficient public management at the subnational level.”
The program will provide up to 15 participating provincial governments with performance-based grants as financial incentives to implement management measures aimed at improving expenditure efficiency and strengthening the collection of provincial taxes.
This innovative initiative complements the system of intergovernmental fiscal relations in Argentina with an incentive-based instrument aimed at improving fiscal performance. The program will also support capacity building for participating provinces and Argentina's National Treasury.
Participating provinces are expected to strengthen controls over personnel expenditures through measures such as centralized payroll management systems and tools to identify and reduce spending inefficiencies. The program will also support efforts to reduce operating deficits in state-owned enterprises and enhance oversight of pension payment systems.
On the revenue side, provinces are expected to modernize taxpayer registries to broaden provincial and property tax bases. The program will also promote greater fiscal transparency by supporting compliance with reporting requirements established by the National Treasury.
The IDB’s $750 million loan has a 25-year repayment term, a five-year grace period, and an interest rate based on SOFR.
About the IDB
The Inter-American Development Bank (IDB), a member of the IDB Group, is devoted to improving lives across Latin America and the Caribbean. Founded in 1959, the Bank works with the region’s public sector to design and enable impactful, innovative solutions for sustainable and inclusive development. Leveraging financing, technical expertise, and knowledge, it promotes growth and well-being in 26 countries. Visit our website: https://www.iadb.org/en.
Romina Nicaretta
Communications Lead Specialist
