It is not that the president is in charge: Management is in charge. I have the political responsibility of the company. It is a company that quotes in the stock market and, in doing so, we have all the transparent numbers so that the public decides whether or not to invest on the activity. I always say that we sell confidence: we are the universal custodian of all titles and values in Argentina, and we use technology for that.
We are in a country circumstance with an interesting potential because now the real economy must be financed. Before, we all worked indirectly for a central bank that absorbed much of the banks of the banks and the market. Much of the volume was bonds adjusted by inflation or dollar Linked. Now, if there is fiscal surplus, the central needs less financing and that opens the way to the real economy.
Q.: How do you qualify the level of financial education in Argentina? Are we a country that knows investment?
CZ: By DNA, the Argentine has a lot of financial education. The taxi driver knows the value of money, everyone knows what inflation is and understand the definition of present value. I don’t have to explain it. The problem is fear, because the Argentine was scammed many times: inflation, fixed deadlines that they did not cover, rental contracts that did not serve.
To this is added the lack of institutionality: it is not trusted in justice, in political power or in the media. A check, a mortgage, a value title are institutions, but people do not trust. The biggest problem is cultural: the distrust we have between us. And it is not that the outside does not trust: the Argentine has more money outside the country, declared.
Q.: How does the capital market react with surplus and low inflation?
CZ: Before the market worked as coverage: the media notes were on how to cover the weights or protect themselves from inflation, buying yields, dollar MEP, ruling, etc.
My profile and my training as a Bachelor of Business Administration lead me to focus on the real economy. Now I have to convince you to invest in a negotiable obligation of an SME or in an action.
Q.: What assessment does criticisms about how the tax adjustment is carried out?
CZ: The capital market finances in the long term. Infrastructure, for example, should be financed by this route, because it is a long -term commitment. If not, the current taxpayer pays a work that will not use. Before we didn’t have it because there was no long -term currency. The mere fact of being able to talk about deadlines of 6 months or one year is already an advance. And if Argentina leaves inflation and maintains the surplus, the capital market will have a key place.
Q.: The IMF calculates 1.2% deficit when considering the interests of the LECAPS, where the government sees surplus. How do you position yourself in front of that difference?
CZ: It is a matter of methodology. If it is always measured in the same way, the evolution can be compared, even if the numbers are different. What matters is the consistency in the measurement, not so much if an organism already surpasses another deficit.
Q.: The Government seeks to repatriate funds to turn them to the real economy. What conditions are needed to achieve it?
CZ: That will give time. Trust is won with acts. Not only does it depend on the Executive: there are three powers and everyone has to work well, not one.
Q.: Is it another laundering?
CZ: I do not see it as a laundering: if someone has money outside and pays their taxes, the country collects. Even outside more taxes are paid than in Argentina. While being declared, each one is free to use their capital as they want.
Q.: In this context, what changed from the proposal of dollarization to the current monetary program?
CZ: Today we are what the government calls “endogenous dollarization.” According to how it is defined, it can be seen as a process in stages: first, second, third … and in the end the citizen will choose in which currency stay.
If you look at the deposits in a fixed term, in dollars, and the relationship between reserves and quantity of pesos, today we are much closer to dollarizo than before. Perhaps the weight still makes sense because the wages are paid in pesos, but the previous duties were done.
Something similar happened with the Central Bank: before closing it, it was necessary to clean up, otherwise people were harmed. The debt of the Central Bank was everyone’s debt, and ordered it.
Q.: Do you think it is more convenient to dollarize or maintain your own currency with good monetary policy?
CZ: I prefer to have your own currency with very good monetary policy. If monetary policy is healthy, you don’t need to dollarize. Dollarization is like putting a knife in the steering wheel to a distracted driver: avoids certain errors, but does not protect you from all risks.
To dollarize, in addition to credibility, you have to have a very manageable fiscal order. In the 90s, he tried without meeting these conditions. If you are tax ordered, the currency is worth.
Q.: In recent weeks there was exchange volatility, damping by the rate rise. Symptom of unsustainability or conjunctural issue?
CZ: The most important thing is trust. The strongest anchor is the fiscal surplus. When laws are approved that can generate deficits or decisions are prosecuted, noise and fear of that anchor is lost.
If the government does not emit, as is the case now, the exchange rate can be maintained without moving strongly at prices. The recent jump responded to political noise, more pesos and dollarization of portfolios, but if the transfer at prices is low, it is a sign that the situation was accommodated.
Q.: Don’t you count what some analysts pointed out as “lack of timing” in the disarmament of the Lefis?
CZ: The disarmament of the Lefis could have had a timing problem, but I do not like to judge the time of the measures of the economic team. I do not see a risk of the foundations of the economy and that is only. For many, it was more comfortable to give to the Central Bank than to a company or the Treasury. The change led some to prefer to stay liquid.
If this volatility was maintained, it would be a problem for the real economy. But if it is transient, it is an adjustment that the market absorbs.
Q.: To what extent can Carry Trade sustain the stability of the exchange rate?
CZ: It is different from the past. Before the Central Bank, owner of the machine, offered risk without risk. Today, to make Carry Trade, you have to buy a bonus, which can rise or lower price. When the rate goes up, the price of the bonus drops. That is why it is not a business without risk: the interest rate is based on the risk assumed.
Q.: The government buys dollars above $ 1300 to accumulate reservations, but when it was closer to $ 1000, it dismissed this option. Because?
CZ: The decision was that the Central Bank did not intervene, unless the dollar touched the band of the band, but the Ministry of Economy can buy. The difference is that economy does not emit: buy with surplus.
This was agreed with the IMF. The central has as its main function to take care of the currency, and in this scheme that task is more limited. Economy buys dollars when it has room, as happened recently.
Q.: What weight does the market give to the political factor and the conformation of Congress?
CZ: First, no one is “the market”: the market is all. There is no single voice that speaks for him. What matters is what most people think. Once, in a round with foreign investors, they told me: “I don’t care what a government does, I care if society supports or does not endorse.”
It is not a matter of one party or another, but according to basic things. There are left and right countries that grow if there is consensus. In Argentina, for a long time, half wanted to go to one side and the other half for the other. If 70% go to the same direction, no matter the speed or manners: there is a common vision. If there is division, the investment is stopped because it is not known where the country is going.
Q.: Argentina could be financed abroad in 2026?
CZ: I should do it. It is key to the real economy and for SMEs. Today Argentina has one of the minor debt/GDP ratios in the region. It is not a stock problem, but of access to credit. To fund again, the country risk should go to 450-500 basic points. That can be achieved with ordered elections, credit rating improvements or fiscal continuity signs.
Q.: Regarding the latter you mention, how do you see credit dynamics?
CZ: The credit was already braking. More than the exchange rate or rate value, you have to look at how it impacts the real economy. If the credit is stopped due to this volatility, there may be a negative effect. But if the movement lasts a few weeks and stabilizes, it should not have a lasting impact.
Source: Ambito
