The former minister of Economy, Jorge Remes Lenicovwarned that a “integral program” that he have the support of Congress to overcome the crisis, because “it is not enough just to devalue” the currency to improve the economic scenario.
“When one has to attack the problem of inflationmust be attacking all factors. One cannot say that ‘public spending must be lowered’ or ‘you only have to devalue’, the program has to be comprehensive and it has to be all at once,” he added.
The economist, who led the exit of convertibility in 2002said that there is a “crisis scenario, although without explosion”but maintained that the current government “already gave what it had to give and has no capacity to make any changes.”
“We are in crisis. There is no outbreak. In 2001 we came from three years of crisis because the recession began in the middle of 98 and broke out with some measures such as the corralito. Now measures are being taken to arrive, but there is no comprehensive program“, said the economist in statements to channel A24, in the framework of the presentation of his book “115 days to disarm the bomb”.
Remes Lenicov recalled that during the management of eduardo duhalde in front of the Presidency “he got out fast because there was a political agreement with Alfonsín and later because there was a comprehensive program”.
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Courtesy: Impulso Negocios
“We had begun to put together the program for the 1999 campaign“, he indicated and added: “When we arrived at the Government we had the laws well armed and in 60 days we were able to apply all those measures. That should be taken into account for the next Government“.
Even so, he warned that the current scenario makes it difficult “to agreement between the two largest groupsbut that does not mean that you cannot put together a consensus to have a majority in the Congress, because who defines the laws is the Congress. It is essential to make a political agreement.”
In turn, he maintained that a comprehensive program requires political leadership and “not jumping stages”: “One cannot grow at 8% without money or reduce poverty with plans. There has to be an instrument for each problem. I didn’t do any dirty work, I did what I had to do.”
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About him exchange rate delay of official dollars over financial ones, the former minister emphasized that “it cannot be devalued if there is no comprehensive program”. “If one devalues as was done not so long ago or does it gradually and does not accompany it with a fiscal, monetary and income policy accordingdevaluation is useless. Because it generates more inflation and eats up the real increase,” she warned.
Regarding the proposals of the dollarization of the Argentine economyrecalled that during his time at the Palacio de Hacienda he had “a lot of pressure from banks and exporters”, but that “when you dollarize you lose policy instrumentsand a country like ours needs the whole dashboard, not a piece.”
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“If you dollarize, you have no monetary or exchange policy and you tie your situation to the situation of USA, that if it goes well and productivity increases, your currency will be revalued. I disagree with that policy. The problem is that there are words that sound good and synthesize a whole thought that is not made explicit, and people buy that. Dollarization was done by small countries like Hong Kong either Ecuador“, he said about the project proposed by the pre-candidate javier milei.
I consider that “Changing the monetary sign does not solve your real problems, you do not increase productivity, competitiveness or social problems by changing the monetary sign. The currency is essential that it has its stability to allow one to design in the long term”.
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(Photo: Freepik)
What do they say from the Government
Referents of Government they maintain that although the economic situation is difficultthere is a scenario of job creation and recovery of productive branches, and rule out the possibility of a devaluation.
“The economy has problems but it continues to generate jobs: in January we had the highest level of private formal employment for at least the last 14 years (when the series begins),” said the secretary of Productive Development and Industry on his Twitter account. Jose Ignacio de Mendiguren.
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Telam
“The industry has been a great lever for formal employment. In January it increased again and accumulated 32 months of consecutive month-on-month growth. 21 of 24 industrial branches exceeded the job levels of December 2019. We are concerned and busy every day to improve the purchasing power of wages, impacted by inflation. But nothing is built or fixed on models that destroy jobs. This year we have to discuss those models in white on black,” he added.
For his part, the chief of advisors to the presidency Antonio Aracresupported the idea against a devaluation: “A devaluation process is a devaluation leap. And that is impoverishing. In Argentina when you devalue, with the degree of bimonetarism that exists, we have a passage to inflation of 80, 90, 100%. Poverty increases and purchasing power is reduced and the recovery of wages after this inflationary process is very slow. That is why when Patricia Bullrich says that she wants to lift the stocks immediately, they should ask her how that is in the short term, because it implies a devaluation jump “.
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“We are avoiding it,” Aracre stressed. “If you look at the numbers for public spending and the fiscal deficit since 2020, you can see a fairly significant reduction. In 2020 we had to face a horrifying pandemic. Other countries could resort to borrowing, we had to issue (the equivalent of) 10% of GDP and that still hits us in terms of inflation. We must take into account in what conditions we received the country and what happened to us later with the pandemic, the war and the drought, the impossibility of getting into debt, ”he added.
Source: Ambito
