The demand steady and flowing dollars brings together various protagonists ranging from individuals up to the same National Stateso the question arises as to what tools the Government has to keep the national economy afloat without compromising the response capacity of the Central Bank of the Argentine Republic (BCRA).
Likewise, it should be noted that satisfying the demand for dollars for each of the sectors with the current currency flow it turns out to be impossible. So the government starts to make use of the available tools to more or less maintain the flow of foreign currency and avoid destabilizing movements.
Disbursements from international organizations
The Government can persist in the search for financing of international organizations such as the Andean Development Corporation (CAF), the Inter-American Development Bank (IDB) and the world Bank (BM). In fact, he has been working hard on this path, with frequent trips by the Minister of Economy, Sergio Massaseeking to achieve new funds in recent months.
This funding source allows the current management to obtain dollars at a lower cost than through other methods, in addition to the advances that could come from the International Monetary Fund (IMF). However, it is also necessary to continue negotiating with said body to make booking goals more flexiblereduce this year’s net payments and expedite disbursements, so that the account of Special drawing rights (DEGs) is not negative and the BCRA you do not have to use your own reserves to make payments to the agency.
Foreign trade and investments
The government also has the option of resorting to different economic organizations international organizations, which present great potential in terms of investment and increased trade, with the aim of obtaining significant financing to put an end to to speculation on the value of the currency.
However, this implies seeking additional resources through the financial leg, using international financial organizations.s, the Saudi Fund, investments from China, activating and using swapsas well as carrying out negotiations with Brazil to gradually eliminate the use of dollars in bilateral trade.
However, this does not imply the direct obtaining of dollarsbut it seeks to avoid the exit of North American currencies using swaps or real through a direct conversion mechanism to those currencies to compensate the seller of the other country.
Lithium and hydrocarbons
There is a strong expectation that commercial income in dollars increase through exports of hydrocarbons and mineralssuch as lithium and other metals.
The Government expects that this year the income from investments and exports of the mining sector will amount to US$6 billionwith an important impulse in the explorations of the so-called “White gold“.
The commissioning of two new lithium projects and the expansion of the other two of this type that are already operating in the national territory, will allow, according to official data, the entry of approximately US$ 6,000 million in 2023. According to data from the Ministry of Economy, this figure is made up of income for US$2,000 million of investment and an increase in mining exports, which, according to official projections, will amount to US$4,000 million this year.
Dollar soy four?
The government got a break at the close of the soybean dollar in its third versionwhich allowed the Central Bank to strengthen the reserves, which continue in negative groundfor which reason it is already speculated that a fourth edition of the Export Incentive Program (PIE), which contemplates a differential exchange rate for agricultural settlements, that contributes foreign exchange almost like no other sector.
It is very likely that the government I already contemplated a fourth edition of the programmaybe for August or September, since he took this path three times to earn dollars and strengthen reserves of the Central.
It should be noted that in the above schemes the Central managed to retain 65% of the value of soybean dollar 1 and 74% of the value of the soybean dollar 2while , the soybean dollar 3 contributed US$5,086 million in this third edition, thus surpassing the US$5,000 million foreseen by the Ministry of Economy when the tool was relaunched, on April 12.
The dollar and a complex panorama
The dollar outlook presents an extremely complicated situation. Argentina was already limited by an agreement with the IMF, which was difficult to comply with in normal circumstances due to the very complications on the external front of our country. This complexity was further aggravated by the problems caused by the severe drought.
As a result, in an election year and with little room for maneuver Due to the weakness of the current administration, the Government is forced to resort to possible sources of income of dollars, although are not largewith the aim of easing the situation until the elections.
Source: Ambito
