It is more than evident that once the Minister of Economy, Sergio Massaachieved the disbursement of the $7.5 billion of the International Monetary Fund (IMF) and devalued 20% on August 14 due to an agreement with the organization, now its government actions are being oriented based on the October elections. For example, according to a report from the Congressional Budget Office (CPO).he accrued spending of the National Public Administration (APN) recorded its second consecutive year-on-year increase in real terms in Augustboth primary and total.
This is a turn in the cutting trend that occurred between July 2022 and June of this year. Last month, primary expenditures amounted to $2.86 trillion, with a nominal increase of 132.4% and a real increase of 3.6%, while total expenditures were $3.18 trillion, with an increase of 127.8%. at current values and 1.5% at constant values.
In the accumulated of the first eight months, primary expenditures totaled $18.17 trillion with a contraction of 6.8% in real terms. while the totals amounted to $20.2 billion and decreased to a lesser extent (4.8%), as a consequence of the real increase reflected in the payment of interest on the debt (16.7%).
The most relevant real decreases were recorded in family allowances (26%), in energy subsidies (19.5%), in transfers to provinces (19.2%) and in social programs (17.6%).
The OPC indicated in this regard that “in the case of the item retirements and pensionsalthough the real decrease was more limited (3.2%), it was the fourth item with the greatest contribution to the reduction of total expenses given its participation in the structure of primary spending (39.2%).”
As for the income, in August the current denominations registered a total of $2.7 trillion, with an increase of 149.9% nominal and 11.4% real. In the first eight months they accumulate $15.5 billion, which indicates a nominal improvement of 104.4% and a real decrease of 3.3%.
The OPC clarified that “this variation is reduced to -0.2% year-over-year if $400,000 million that the Central Bank of the Argentine Republic (BCRA) transferred to the National Treasury in the months of July and August for the distribution of profits.”
Several market operators indicate that, to the extent that Massa was making tax reduction announcements last week, the Treasury Palace is ignoring the parameters agreed with the IMF for 2023. If with the adjustment of the accounts it is already I thought that the primary deficit was not going to be less than 2.4% of GDP, compared to a goal of 1.9%, with the announcements already foreseeing no less than 3% of GDP for the year.
On the other hand, as of August 31, the total accrued expenses represented 54.6% of the current budget credit. In current expenses, 55.1% was executed while 49.1% in capital expenses. In most items of current spending, a lower level of execution was observed than that recorded last month as a result of the approval of DNU 436/2023 of August 30, which increased the expense budget of the National Administration by $7.6. billions.
Source: Ambito
