The Minister of Economy, Luis Caputo, He assured that The Government has been showing that it can keep the promises it made to the market“During these seven months, we have been busy proving that we were going to fulfill what we said and that is what we have done in these seven months,” he said. He stressed that “We put an end to the myth that Argentina could not have fiscal balance on their own merit.”
In order to calm the pressures for lifting the restrictions, he also stated that “this is a long-term process and we are not going to lift the restrictions in a short time,” but he promised that they will do so. He said this in the framework of a conference and subsequent talk at the Córdoba Stock Exchange that took place this Friday within the Cycle of Economic Situation organized by that entity.
Caputo promised to lower taxes
On the other hand, in the most applauded part of his speech, Caputo promised those present that, “when this Government has money to spare, it will lower taxes and we will get the private sector out of its way.” He said that this will be the way to gain competitiveness.
“We cannot continue lying to ourselves that we are competitive. I don’t know how they manage to pay the huge amount of things we charge them and continue to survive,” acknowledged the minister, who called on the private sector to assume the key role it has in the recovery of the economy.
“We must continue doing exactly the opposite of what has been done in the last 80 years. We need to generate empathy with you so that you understand your role as citizens. You are co-protagonists in this story. Political colors do not matter,” said Caputo. And, in that sense, he called on those present to “build that country that we once were and can be again.”
Money laundering: “The country needs it and I hope they respond,” said Caputo
Caputo then spoke with the former president of the Central Bank (BCRA), Guido Sandleris, who acted as interviewer. And, in that context, he spoke about the money laundering. “It is a key initiative for the recovery of the economy. It is not a duty, of course it is optional, but the commitment to this money laundering is key to solving Argentina’s problems. The country needs it and hopefully they will respond,” he said.
On the other hand, when asked which taxes are going to be lowered, Caputo said that “we started with the PAIS tax because we had promised and we fulfilled it.” He said that he would have liked to move forward with some tax that was shared, but it was not possible and that
Regarding the restrictions, he said that “we are not setting a date, but conditions.” What we are looking for is that when we lift it, absolutely nothing happens and he acknowledged: “The conditions are not yet met. There is no need to worry if the restrictions are lifted a month earlier or later, but we have to be sure that the course is maintained and we have to know that it is very important not to make mistakes in this process.” He assured that, if inflation is reduced and the gap is reduced, we are on the right track.
Inflation, the priority of this administration
Another of the topics that Sandleris touched on in the conversation with Caputo was the BCRA reserves and he asked him what plans he has to recover the reserves. “Reality is going to improve more and more and will validate what we are doing: inflation will continue to fall and the economy will continue to recover. In that context, we must see that we have already generated the surplus necessary to pay the maturities that are coming,” he said. And he assured that these are key elements to reduce the country risk, which will facilitate Argentina’s entry into the global debt market. In that sense, he pointed out that his main objective is to “reduce the most serious tax, which is inflation.”
He promised that the peso will become a strong currency and admitted that he was “very optimistic about inflation.” “We are attacking all the causes of inflation and Argentina is on track to achieve a lower level of price evolution than the one obtained in July.” And, in that sense, he said that “inflation will go down a new step.” In this way, he implied that he expects it to start with 3 in August.
Finally, he defended the evolution of the crawling peg that has been applied to the official exchange rate. “Even those who look at the exchange rate in the historical sequence and say that it is behind are wrong,” he said. He said that the dollar during the Convertibility was at a value close to $550 and that the historical value in times of crisis was around $1,000, so he assured that it is not true that the rhythm of daily micro-devaluations of 2% per month is behind.
Source: Ambito
