Dal Poggetto analyzed the Government’s economic program in the panel “The Short Term” at ExpoEFI. There, he stated that “the BCRA is bankrupt.”
The economist and director of EcoGo, Marina Dal Poggettoanalyzed the current economic situation of Argentina and assured that Although “fiscal consolidation” is a necessary condition to stabilize it, “it is not sufficient”. In this context, he pointed out that “convertibility was the only stabilization program that worked and had macro, micro and governability”.
Dal Poggetto analyzed it within the framework of the ExpoEFIwhich one Ambit is “media partner”, in the panel “The short term. Analysis of the economic program”.
Microeconomics and devaluation
In this framework, the economist continued with the “microeconomic agenda”, which highlighted that it does not depend solely on the approval of the Law Basesbut is much more comprehensive, it also includes the productivity and background changeswhich “ensure fiscal consolidation.”
In this context, he defended the devaluation “with capital control,” as inflation slowed. “We can discuss whether it was necessary to add the PAIS tax, release all prices and liquidate 20% of the expos in the CCL. But inflation went down. It was necessary to liquidate the ‘overhang’, monetary surplus, of pesos,” he noted.
Marina Dal Poggetto: “The BCRA is bankrupt”
Regarding the Central Bank (BCRA), the economist said that “it is broken”“The discussion is not only about flows, it is also about stocks,” he said. In that sense, he highlighted that the monetary authority buys dollars. Even so, he stressed that the Central has negative net reserveswhich estimated them at US$2.3 billion.
“And there are maturities of US$4.7 billion this year, including Bopreal, always assuming that private debt is renewed and that China refinances the ‘swap’. The migration of debt to the Treasury cleans the BCRA’s balance sheet, but the Treasury debt must be refinanced. First they stretched terms with debt with ‘puts’. Then they shortened deadlines and issued Lecaps,” he explained.
As for the question hovering over the market about whether “Can the trap be opened?“, Dal Poggetto argued that there are three contradictions:
- “Reserves remain negative.
- The dollar is falling behind.
- “The real rate is negative.”
For this reason, Dal Poggetto asked himself: “What is the interest rate at which Argentina can access external credit? What is the medium-term financial program?” “The recession that is needed to achieve this has two limits: a social one and a fiscal one”he concluded.
Source: Ambito
