The problems that the Minister of Economy has to solve, Silvina Batakis they are not few: the price of the different exchange rates that, this Wednesday accelerated their rise after the statements of both the spokeswoman, Gabriela Cerruti –for the vagueness of when the measures would be announced; such as those of the Minister of Tourism, Matías Lammens, with the announcement of a possible split for the tourist dollar.
This exchange rate tension, with the consequent transfer to prices and the uncertainty it causes by paralyzing various activities due to the lack of prices, leads to decision-making becoming imperative, analysts say.
So far, the Minister of Economy, both in the cabinet meeting and those held with governors and mayors, tries to convey the “delicate economic situation that will face these months “ what translated means “We must be very careful with public spending.” Because of the winter and the war in Ukraine, spending on economic subsidies to the energy sector has increased dramatically. There were two situations “greater consumption and the rise in international prices.”
At an official level, they estimate that this tension, which will affect the resources of the Treasury and the demand for dollars, will continue for a couple of months.
Specific austerity measures in the domestic sector are yet to be known. One piece of information that the minister transmitted in the different meetings is that “Public works are not going to be paralyzed” but everyone will have to spend the funds they “they already have”, that is, there will be no extra money.
A measure that the minister has wanted to apply for days is the “to ban public officials from traveling abroad” –With few exceptions – to give a clear sign of austerity and also exemplify the use of the scarce good that is dollars. Nevertheless, still waiting for the government to put it into practice.
The message of austerity transmitted by Batakis, although it is listened to with attention in some cases they tend to be minimized.
Optimism
It is that during this first semester the checks flowed without problems from the Palacio de Hacienda, since the former minister Martin Guzman“curiously” did not warn about the need to reduce spending.
On the contrary, both in his public speeches and in cabinet meetings he gave an “optimistic” message about the economy.
He even stated, some officials recall, that “this year the GDP would grow by more than 7%”; that “inflation will begin to decline in the second semester”; that “”the debt in pesos has a profile of absolute sustainability”, among other optimistic forecasts.
For this reason, while the Batakis try to be as realistic as possible, in some areas, while they hear the message of austerity, deep down they believe that “It’s not that bad.” In addition, when the DNU of the budget for this year was prepared, no substantial reduction in public spending was observed.
On the other hand, at all times both Guzmán and President Alberto Fernández preached that the agreement with the IMF “it did not imply any adjustment or structural reforms”, Both premises are not true.
Precisely the critical situation of the Argentine economy is that during this semester public spending must be reduced at a rate of 8%, significant savings must be made in economic subsidies (particularly in energy matters) and it must be had by the end of the year a reform project for the pension system in order to make it sustainable, to name just a few points.
In the Batakis environment they rescue the support of the governors such as the mayors and the silence of the members of the coalition. They do not feel that they do not have support from the vice president or the Campora “silence is a tacit support for the measures that must be implemented,” they explain. “It would be rare for them to go out publicly to celebrate an adjustment” reflected an experienced politician.
With an eye on inflation, the Batakis administration has already given an indication of how they will deal with this situation. The adjustments will be based on inflation, but they will be requested to be a little less, as the Secretary of the Interior anticipated this Tuesday, Martin Skirt. That is to say, the producers at least will not have prices so far behind. In this way, an agreement was reached with medicines and it will continue with other sectors.
Source: Ambito
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