So far it seemed that everything was to ask for the government, which had the land raided to adopt decisions from aggressive economic policylike the 118% devaluation In December 2023, the Fort adjustment In public spending, a new indebtedness with the IMPthe elimination of evil called “stocks“For human people, and the essay of different exchange schemes. But averaging half of the mandate, the economic program has finally encountered a wall called”reality”
The exchange balance that the BCRA elaborates shows a part of the situation table that the Argentine economy reached by government policies. For example, during the thick harvest he gave fiscal incentives to exporters to advance their liquidation thanks to the – then – temporary decrease in withholdings. According to the Oil industry chamber (Ciara) and the Cereal Exporters Center (CEC)in August the liquidation dropped 25% Regarding the same month of the previous year.
On the other hand, the liberalization of imports and exchange delay were used as an anti -inflationary policy, but they ended negatively impacting the merchandise balancel. Before being president, Javier Milei had already warned that with the import opening local producers were going to compete offering “better quality or best price goods, but will go bankrupt”Unfortunately, it is what is happening, they are breaking. When the imports will be reversed at some point, imports will stop, but the damage is already done. If the local producer broke, it is not easy to start again.
Even more serious for external accounts was that human people be allowed freely accessing the change market. Thus, in the accumulated result of the first seven months of this year, oilseeds and cereals generated net currency income by US $ 19,955 million –Steguidos in part thanks to the decline in the retentions already mentioned -, while the net purchases of foreign people of human people reached US $ 19,045 million. Almost the same amount as He entered the country through one door.
This structural tension in the exchange market, far from being reduced, was overestimulated for a measure like the migration of the BCRA Lefi to the Treasury. Excess liquidity increased pressure on the dollar. To counteract it, the “Monetary squeeze”, Such as the rise of bank lace that resulted in the increase in rates, with harmful consequences for production.
Guillermo FrancosChief of Cabinet, admitted that “In these months the consumption can fall a bit, product that interest rates are high and people do not want to borrow”. To people and companies have a hard time taking loans because rates rose more than wages and income, within the framework of a depressed economy. An indicator of this situation is the increase in default in the consumption segment.
The anti -productive bias of the model is notorious. It is not a limited reality to SMEs. Every week news of big companies comes out in trouble.
With the rates, The fall in the activity will be greaterdragging the collection, which was already losing strength due to the reduction of taxes granted by the Government in export rights, the end of the country tax and the decline of the aliquots of the personal property tax. This lower collection compromises spending financing. The Treasury has been compensating for Lecaps tenders and other public titles, some of these subscriptions were induced through the rise of paid lace. The interests of these letters capitalize so as not to show themselves in the current deficit, as they are paid at the expiration. It is still a constant growth debt, and feeds the fiscal problem.
All these policies have not been harmless, the economy has been felt and, therefore, also the society.
In this framework, the adverse results for the Government in Congress They are not due to a dismissive vocation of the opposition. It is not about “fiscal degenerates”, or “of the armed arm” that exercises “economic terrorism”, nor to “break the rules of democratic play and generate instability”, as stated from the government.
The resistance in the streets and in Parliament is an expression of the contradictions of the model itself, which threatens the production, employment and income. The limit begins to mark the adjusted.
Source: Ambito
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