The numbers on the fiscal front seem to show that the goal agreed with the IMF is getting more and more complicated and, therefore, the possibility of meeting the deficit goal of 1.9% of GDP is receding. And it is that the signals that are giving some data of the last weeks indicate that this objective is falling far away. This Monday the data of the National Public Sector (SPN) will be released which are key for the negotiations with the International Monetary Fund (IMF).
According to private estimates, in the first quarter of the year the accumulated deficit would have climbed to 0.65% of the Gross Domestic Product (GDP). The number arises by approximation to the amount of net financing in the peso market and the assistance of the Central Bank to the Treasury.
The stock exchange company Portfolio Personal Inversiones (PPI) pointed out in a recent report that “in the first quarter of the year the primary deficit was very much in line with net financing.” In that period, the red was $689,000 million, which is equivalent to 0.42% of GDP. “If so, the primary imbalance would continue to deepen to 0.65% of GDP,” the report added.
In January, the imbalance was $204,000 million; in February, $228,000 million; and in March, of $257,000 million. If the incremental logic holds, in April -which is seasonally a month of greater deficit- the red would have to approach $300,000 million. In addition, in that month the government had to resort to $100,000 million in assistance from the Central Bank.
As indicated by the Congressional Budget Office (OPC), the accrued primary deficit reached $1.03 trillion between January and April and the financial $1.8 trillion, with a year-on-year cut in real terms of 9.3% and 2.2%, respectively. Regarding the fiscal result of April, the deficits were $274,432 million in the primary and $324,269 million in the financial, with real decreases compared to the same month of 2022 that reached 23.4% and 36.9%.
The results differ from those of the Treasury for methodological reasons, since the bicameral entity takes into account the accrued result of the National Public Administration and the Ministry of Economy the executed result of the Non-Financial Public Sector, although they mark a trend.
In the first quarter, APN revenues accumulated $6,084,373 million, which implied a 9.1% decrease in real terms with respect to the same period of the previous year. On the other hand, total expenses reached $7.9 trillion and showed a real contraction of 7.6%. Although the Ministry of Finance shows that fiscal efforts are being made, the problem is in income. As a result of the drought, withholdings on exports plummeted 75% in real terms in April, registering just $50.5 billion. Last month, exports fell 29% compared to the same month last year.
In this regard, the chief economist of the Fundación Libertad y Progreso, Eugenio Marí, pointed out that “this promise was far away” from the government to the IMF to lower the deficit to 1.9% of GDP. “The fiscal deficit continues and the government is depending more and more on direct monetary financing (Temporary Advances) or indirect (with the BCRA providing liquidity for the purchase of titles in the tenders),” said Marí.
Source: Ambito
