RTL Today – Despite economic crisis: Argentine economy minister pledges to respect IMF deficit deal
Argentina’s new economic “super minister” pledged on Wednesday to respect the country’s commitment to the crisis with the IMF to reduce its public deficit to 2.5% this year.
As part of Argentina’s long-running negotiations with the International Monetary Fund to restructure a $44 billion debt, the authorities had agreed to gradually reduce the public deficit from 3% in 2021 to 0.9% by 2024.
“We will achieve the primary budget deficit target of 2.5%. We will make the necessary corrections to keep our word,” said Sergio Massa, in announcing his first steps as the new “super minister” in charge. economy. , development and agriculture, as well as relations with international organizations.
Argentina has suffered from years of economic crisis, with around 37 percent of its population now living in poverty.
Inflation for the first half of this year alone exceeded 36% and is expected to reach 80% by the end of the year.
Speaking at a press conference after being officially introduced by President Alberto Fernandez in his new post, Massa described inflation as the country’s “biggest poverty factory”.
“Inflation is one of the main issues to tackle. Last month and the one that has just started will be the most difficult in terms of inflation and from there we will start a downward curve,” said Massa, 50 year-old lawyer by trade who on Tuesday resigned as speaker of the lower house of congress to take up his new post.
Massa brushed off the “super minister” moniker, saying “I’m not a ‘super’ anything – neither a magician, nor a savior. I came to work in a very determined way.”
Fernandez, speaking at Massa’s swearing-in, hailed a “new stage of government”.
“I am convinced that we will succeed,” he added.
– Difficult challenges to overcome –
Massa becomes Argentina’s third economy minister in as many months.
In late July, economist Silvina Batakis was fired less than a month after she was chosen by Fernandez to fill the post suddenly vacated by Martin Guzman, the architect of the debt refinancing deal who had held the post for December 2019.
In his speech, Massa pledged to tackle “Argentina with two faces” where there is some economic growth and employment, but “a huge lack of confidence in the currency, disorder in spending, public investment shortfalls and huge inequity in income distribution”.
One of Massa’s toughest challenges will be to increase Argentina’s available international reserves, which analysts say are at critical levels.
On that front, Massa on Wednesday announced a deal with exporters to push sales forward and bring some $5 billion to the Central Bank within 60 days.
For Victor Beker, director of the Center for the Study of the New Economy at the University of Belgrano, the announcements made on Wednesday “are important, they go in the right direction, but they fall short of expectations”.
“We are still far from having a global economic plan, far from having answers on how inflation is going to be fought, or on the functioning of the foreign exchange market,” he told AFP. .
One problem he won’t be able to solve, however, is the ongoing power struggle in the ruling Frente de Todos political coalition between Fernandez and Vice President Cristina Kirchner, herself a former president.