BUENOS AIRES (Reuters) -Argentina's Economy Minister Sergio Massa said on Monday the country will not use "a single dollar" of its own reserves to make a $2.7 billion repayment to the International Monetary Fund (IMF) due this week.
Massa, who is also a presidential candidate in this October's election, said in a speech that it would be possible because of an extended swap deal with China and a new loan from the Development Bank of Latin America (CAF).
Massa confirmed the repayment will be made with a $1 billion bridge loan from CAF and $1.7 billion coming from the second tranche of a swap with China, a move Buenos Aires recently made to complete part of its June payment to the IMF.
Argentina, which has been grappling with a severe economic crisis with sky-high inflation and falling central bank reserves, needed to avoid a default with the Fund, with maturities of $2.6 billion due on Monday and almost $800 million due on Tuesday.
"I want to bring you peace of mind - Argentina is not going to use a single dollar of its reserves to pay today's maturity," Massa said in a televised speech.
The challenge for Argentina now, he added, is to "continue to take care of the (foreign currency) reserves while maintaining the economic activity levels."
(Reporting by Eliana Raszewski and Gabriel Araujo; Editing by Bernadette Baum and Alexander VIllegas)
