According to a report by the Mediterranean Foundation, 30% of the Argentine gross debt would be generating interests that are not registered monthly In the result of the national public sector (SPN), which so far accumulated a primary surplus of 0.8% of GDP.
That part of the debt includes a 24% in bonds and letters adjustable for inflation (CER) and a 6% in letters and capitalizable bonds which are the ones used by the Ministry of Economy to withdraw weights from the market. The institution estimates that the capitalizable debt and the adjustable debt by inflation add up to US $ 139,662 million, equivalent to 16% of GDP.
While the Mediterranean states that Analysts usually put their gaze on LECAPS and BANCAPS at the time of determining what the true fiscal result would be if interests were counted as an expense, consider that The same should be done with the bonds.
The reasoning is that in the Bonds tied to the evolution of prices “The capital balance is systematically adjusted by the inflation of the period.”
In that way, Neither the interests of the CER bonds nor the capitalizable titles are taken into account when the Government informs the fiscal result every month. They become new debt automatically and do not affect the result.
The controversy due to the sustainability of the scheme
In the former Five months of 2025 The national public sector achieved a primary surplus equivalent to 0.8% of GDP and a financial one of 0.3% after the payment of debt. The difference of Half point is payment of other debt interest.
The report clarifies that “the discussion about the level of Accounted interests ‘on the line’ In the execution of the budget, it should have already been raised as necessary for many years. ”
The Mediterranean recalls that one of the rules of the administration of the macroeconomy is that The interests of the debt do not exceed the primary surplus, because in that case the debt raises, but it states that also It is necessary to put the debt against GDP.
“If the GDP growth rate is positive and exceeds the interest rate of debt, inclusive There could be a primary (and financial) deficit and be sustainable, if the relationship between debt and GDP does not increase, ”he explains.
For example, the work indicates that the consolidated debt of the Treasury and the Central Bank It went from 63.9% of GDP in November 2023 to 52.2% of GDP in May 2025, which marked a drop of 18.2%. In absolute terms to constant currency, it went from $ 542,145 billion to $ 535,444 billion in the same period with a 1.2%drop.
Debt/GDP: There may be errors
But the former director of the Central Bank Jorge Carrera warns that the use of debt/GDP indicator “Throughout a temporary sample it can lead to important errors if the real exchange rate situation over time is not taken into account.”
He points out that the real exchange rate affects heterogeneous both with GDP measurements and debt. “The type of appreciated or depreciated change can increase or decrease GDP “says career in a post of the social network X. in the same clarifies that this variable also “It affects the valuation in pesos of the debt in foreign currency.”
A fact to keep in mind is that When the government devalued in December 2023, the PBI debt ratio went from 63.9% to 101.1% and from then on it went down every month, a period that It coincides with the appreciation of the exchange rate.
The key is to maintain growth
Eugenio Marí, chief economist of the Foundation Freedom and Progress, He estimated that when the sustainable model “at the end of the day the important thing is if the reforms can advance for the economy to grow. 5% grow the debt problem is accommodated,” he said.
As he pointed out, One of the problems of Argentina that is still in a stage of “Liabilities Administration”in reference to the large mass of debt in local currency that the treasure has. For example, in August they beat at least $ 28 billion. Marí considered that it is a “fine balance.” “The demand for money is growing, but not so much to release that liquidity,” he explained. If this would be released, it could cause a strong devaluation.
Source: Ambito
