carlos rodriguezformer Vice Minister of Economy and head of economic advisors at Javier Miley, warned that the key to any economic plan will be the “tax adjustment”because “otherwise it will be very difficult to apply a dollarization”.
“If you don’t have a fiscal adjustment, nobody will lend the dollars to buy the pesos, and nobody is going to release them,” he warned.
He further warned that “Argentines are not going to bring the dollars either if there is no fiscal adjustment”in dialogue with Somos Nosotros, the program hosted by Willy Kohan on Rivadavia radio.
“People are worth more than plans, so leadership and strength in negotiations are important,” explained Domingo Cavallo’s former number two in the ’90s.
He also considered that both Patricia Bullrich and Milei want to promote a majority agreement for a fiscal adjustment, but he doubted that the radicalism wants to advance in a deep cut in spending.
As for the Peronists, Rodríguez estimated that “as they always go after the winner, they will provide support for a fiscal adjustment.”
Milei’s chief adviser recalled that the candidate had already announced, for example, “changes in public works, once the hundreds of contracts that this government will sign are completed.”
He also warned that “with this inflation it is impossible to make a budget.”
“The Government is using a part of what the Fund gives it to repay part of the debts. I hope that the rest will be used to strengthen the reserves,” he said.
“We are at an interest rate of 209 percent, very high, it cannot last long,” he considered.
He said that “if fiscal balance is not achieved we are not going anywhere”, and he distinguished between “dollarization and de-pesification”.
“Here the two things come together, one thing is to dollarize, what can be done on December 11, which is to allow the dollar to circulate without killing the peso. Whether it survives or not is another matter, it depends on credibility, on the package of laws that is presented, how the markets see it. It would be the bimonetarism” that Bullrich proposes, he explained.
But he said that “despesifying is something else. The Central Bank has the promissory notes. You have to redeem them with something, with dollars, with a Bonex Plan, with papers from public companies, whatever…”.
Source: Ambito
