The virtual Minister of Economy of the white candidate explained the measures that the eventual government will implement to reduce the country’s production and export costs.
The former president of the Central Bank of Uruguay (BCU) and eventual Minister of Economy of Alvaro Delgado —if he wins the October elections—, Diego Labat, He maintained that the competitiveness “It will be a central axis of economic policy in the next government.”
“Competitiveness is very important for Uruguay”, Labat said in an interview with Radio Monte Carlo. The truth is that this is not news to anyone – much less to the economist – considering that the loss of competitiveness It has been one of the most important claims by the export sectors, especially the agriculture, also linked to the situation of exchange rate lag that the country is still experiencing, despite the improvement in the exchange rate in recent months.
For Labat, however – although it is not surprising either – this problem is not addressed from a foreign exchange intervention It has nothing to do with the monetary policy driven by the government in order to control inflation. “It has to be concerned with achieving efficient, or more efficient, and cheaper production,” he said.
To this end, he pointed out that they have already thought about and defined different measures in order to achieve the objective of improving competitiveness: among them, the care of public funds and the orderly public accounts, “because someone ends up paying for the ill-gotten money and that ends up making the country more expensive”; opening of the economy and the search for more markets along with other initiatives such as the reduction of the consular fee that would make exports cheaper; and the debureaucratization and deregulationwhich harms competition in some markets and makes them more expensive.
Finally, Labat also mentioned the importance of continuing with the investment in infrastructure to have a more competitive country.
Low inflation and floating exchange rate
The former president of the BCU He also referred to the country’s exchange rate situation, noting that “the dollar floats three years ago and the State did not intervene”, so its price is and will be “where the market says”.
Regarding the inflation, He said that inflation will close a little below 5%, just above the center of the target range between 3% and 6%, according to the monetary authority’s estimates; and that the two-year projections indicate a horizon of price increases within the target range, around 4% or 5%. Therefore, no adjustment of the inflation target is foreseen in the medium term.
“It is no longer just the Central Bank that says that inflation will be lower, but also the entrepreneurs”, Labat stressed that low inflation is “an asset for the country” because it provides certainty to individuals and companies.
Source: Ambito
