The Minister of Economy, Luis Caputo, sent a recorded message to the IDEA Colloquium held in Mar del Plata, where he highlighted the achievements made by the administration, outlined the axes of the second stage of the economic program and asked the business community to maintain support for the Government’s direction.
The Minister of Economy, Luis Caputo, He transmitted a recorded message to businessmen within the framework of the IDEA Colloquium in which he thanked the Government for its support during the first 20 months of management and defended the economic course implemented since the beginning of the administration.
The head of the Treasury Palace highlighted that Argentina left behind a fiscal deficit model financed with taxes, debt and monetary emissionwhich—as he maintained—caused “the depreciation of the currency, devaluations, higher inflation and lower salaries.”
“We have dedicated ourselves to fixing these distortions and we were able to do so without breaking contracts, without freezing deposits, without devaluing or going into default, as was done in the past. Today we are in a much more predictable economic context,” noted Caputo.
Fiscal balance and reduction of inflation: Caputo mentioned the achievements of the administration
The minister stressed that The country managed to stabilize the macroeconomy and achieve the long-awaited fiscal balancesomething that —he said— “was not achieved a hundred years ago.” In addition, he highlighted the reduction of inflation to “more normal” levels, although he recognized that prices are still highwith a trend that “will converge towards international inflations.”
Caputo stated that poverty was reduced by more than 26 pointsdescribing this progress as a “fundamental objective,” and highlighted that it is observed a recovery of real wages along with a tax reduction. “It is clear that this is the path by which all Argentines are going to benefit,” he said.
Second stage: labor and tax reforms
The minister announced that a second stage of structural reforms is beginning, focused on the labor and tax areas.
“The labor reform is fundamental because we come from an archaic, rigid and unpredictable regime, which you – the businessmen – are the first to suffer. That is the reason why employment has not grown since 2011. We need a more agile labor regime,” he said.
Regarding the tax reform, he explained that the objective will be eliminate distortionary taxes, reduce others and simplify the systemin addition to promote incentives for domestic savings. “The Government no longer has a fiscal deficit; all that savings is going to be channeled towards private sector investment,” he said.
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Competitiveness without devaluation
Caputo was emphatic in rejecting proposals that associate competitiveness with a weak currency. “I consider it archaic to think that the only way for Argentina to be competitive is with a weak currency. Competitiveness must come from deregulations, lower taxes, labor reform, tax reform and long-term financing at more reasonable rates,” he stated.
Finally, the minister called on the business sector to continue accompanying the process of economic transformation: “I invite you to accompany us in this change. I know that for many it is difficult. We must be able to build a new country; “It is fundamental for the 45 million Argentines.”
Source: Ambito
