The economic team hadIn July the first negative data in the State accounts, although it does not put at risk the fiscal anchor and the balanced result for 2024. Last month had a financial deficit of $600.957 million, a relatively high figure for a month.
The first deficit was expected in June due to the payment of bonuses, However, due to some timely measures taken by the Government, such as moving the payment of June salaries to the first days of the following month or increasing the floating debt, the negative data was postponed to the seventh month of the year.
Somehow, the Minister Luis Caputo admits the June move. “This result is better than expected, considering that In July, bonuses were paid and the interest paid doubled the average monthly interest estimated for the year,” the Ministry of Economy said in a statement.
Caputo had already warned the main executives of the stock exchange companies of the country, a couple of weeks ago, that July was going to have a financial deficit due to the payment of debt interest.
Official information indicates that “in the first For 7 months of the year, the National Public Sector (SPN) has accumulated a primary surplus of approximately 1.4% of GDP and a financial surplus of almost 0.4% of GDP.” It is the first time in 5 years that a primary surplus is reached in the month of July.
Economy indicated that “In the first 7 months of the year, primary spending accumulated a 31% year-on-year reduction in real terms.”
“Economic subsidies were reduced by 39% despite the fact that in July the payment of the transaction of CAMMESA May, a month that was particularly cold and had a significant increase in electricity generation costs”the Treasury Palace stated.
It is also noted that “the reduction of almost a third in public spending in real terms is“It was achieved by prioritizing the most vulnerable sectors.” The official statement indicates that “the resources allocated to the Universal Allocation for Social Protection have increased by 100% in real terms since this Government took office and together with the Food Card they cover 99% of the Basic Food Basket.”
“Social programs have been strengthened and reach the most vulnerable population without intermediaries. In addition, transfers to PAMI have increased by 4% in real terms,” said the Ministry of Economy.
According to lAccording to official information, the SPN’s total income in the month reached $9.3 billion. with a nominal increase of 245.5% year-on-year. Regarding tax collection, it showed a growth of 259.7%, mainly explained by the variation of the PAIS Tax and the income corresponding to Contributions and Contributions to Social Security (233.8%).
On the other hand, Primary expenditures of the National Public Sector reached $8.4 billion with a nominal increase of 177.5% compared to July 2023.
According to the Argentine Institute of Fiscal Analysis (IARAF) in a report “of the analysis from the cash-based budget execution of the SPNNF of the month of July It appears that total revenues had a negative real year-on-year variation of 5%. This is based on the fact that the Tax revenues fell by 1% and non-tax revenues fell by 37.5% in real terms.” On the side of the Primary expenditure, which fell by 23.6% year-on-year real.
IARAF highlights that “interest spending fell 1.1% in real terms compared to the same month last year” since “the fiscal deficit went from $754 billion (in July 2023) to $600 billion (July 2024).”
Source: Ambito
