Sergio Massa took office this Wednesday as the new and powerful Minister of Economy of Argentina, and ratified the goal of reducing the fiscal deficit agreed with the IMF, an organization with which he held a “productive” meeting, while committing himself to fighting excessive inflation. .
“We are going to meet the goal of 2.5% of the primary fiscal deficit (ndlr: before the payment of debt interest). We are going to make all the necessary corrections to comply with the word”, said Massa in his first press conference after being sworn in by President Alberto Fernández.
The reduction of the deficit of public finances -the red in 2021 was equivalent to 3% of GDP- was committed by Argentina in a credit agreement for 44,000 million dollars signed this year with the IMF. The goals also imply lowering the deficit to 1.9% of GDP in 2023 and 0.9% in 2024.
“We had a first productive meeting with the IMF, to continue with the planned disbursements” in the program, declared the minister.
Argentina’s new economy minister will take office on Wednesday, asked to avoid speculation about appointments
Massa emphasized that the government will abandon the use of monetary issuance to close the gap in public finances, a mechanism that weakens the peso and fuels inflation.
“We are not going to ask the Central Bank for more issue money,” he said, after weeks of widening the gap between the official exchange rate and the parallel, informal or ‘blue’ one (139 pesos per dollar and 298 pesos per dollar). , respectively)
high inflation
The minister promised to fight inflation, “the biggest factory of poverty” in a country, he said.
Argentina registers one of the highest inflation rates in the world, with 36.2% in the first half of 2022. Poverty reaches 37% of its 47 million inhabitants.
“Inflation is one of the main issues to combat. The month that ends (July) and the one that begins (August) are going to be the most difficult in terms of inflation, and from then on we are going to go through a downward curve, ”he offered.
“We have to solve this double face of Argentina that grows at 6% per year and generates employment, but has a huge lack of confidence in its currency, spending disorder, gaps in public investment and an enormous injustice in the distribution of income,” emphasized.
Massa, a 50-year-old lawyer who has just left the presidency of the Chamber of Deputies, concentrates under his command the merger of three portfolios: Economy, Productive Development, and Agriculture and Livestock.
But before those who call him a ‘super minister’ he warned: “I am not a ‘supernothing’, nor a magician, nor a savior. I come to work in a very committed way”.
His high political profile and his weight within the governing coalition Frente de Todos (center-left Peronism) earned him the support of Fernández and Vice President Cristina Kirchner, whose disagreements in recent months with the president had created turbulence in the economy. .
“A strong figure was needed who could transmit to society and economic agents things that are agreed upon,” he opined to the AFP Hernán Letcher, director of the Argentine Center for Political Economy.
increase reserves
Massa replaces the economist Silvina Batakis, who did not complete a month in office. This official had taken over urgently after the untimely resignation of Martín Guzmán, the architect of the debt refinancing and who served as Minister of Economy since Fernández took office in December 2019.
The minister faces another central challenge: increasing the dwindling available international reserves, which analysts say are at critical levels.
To achieve this, Massa announced an agreement with exporters to advance sales and that some 5,000 million dollars enter the Central Bank in 60 days.
For Víctor Beker, director of the Center for Studies of the New Economy of the University of Belgrano, the announcements “are important, they go in the right direction, but they fell short of expectations.”
“We are still far from having a comprehensive economic plan, far from having answers about how inflation is going to be combated, or how the foreign exchange market is going to work,” Beker explained to the AFP.
Massa’s plan to boost Argentina’s economy, the third largest in Latin America, includes greater exploitation of energy resources, as well as lithium, and boosting agricultural production, the country’s main source of foreign exchange. (YO)
Source: Eluniverso
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