Recovering economy

The recovery was so fast that everyone is being forced to modify our growth projections for 2021 upwards. The OECD has just reported that it is raising its estimate (almost half a point) to 8%, increasingly approaching the official expectation. In terms of activity, the last known data, September 2021, is 2.5% above December 2018. The industry production indicator in September showed a growth of 14% compared to the same month of 2019. Construction It is 2.9% above 2019, with the highest level of permits in the last five years. We have 9 months of consecutive increase in registered employment that reaches 18 of the 25 sectors of economic activity. The trade surplus is estimated at about $ 15 billion this year.

The other challenge is very different, that of the crisis left by Macri. Crisis that was necessarily relegated by the emergencies of the Covid. Now that the situation is more under control, those structural problems generated by the previous government emerge. The most obvious is the enormous debt with the IMF, unpayable under the agreed terms: it was not brought by Covid, it was brought by Macri; and as the former president confessed, these dollars were used to finance capital flight. It should be remembered that, on the end of his government, Macri had to resort to interventions in the exchange market, against his will and ideology, after allowing this significant capital flight.

There are other worrisome legacies, such as the setback in education that was known in the UNESCO international test carried out in 2019 and whose results were known this week. Argentina was below the regional average, going back 15 years. This was not because the kids missed school days amid a global pandemic or had problems with virtual classes. The degradation of education occurred earlier, when the Macri government dismantled investment in education, cutting more than 1.3 points of GDP there.

The criticism and fake news factory does not stop

These days, a measure of regulation by the BCRA on the foreign currency position of banks – their own capital, not on the depositors’ dollars – has served to generate false news about the destination of dollar deposits. The latter have a liquidity of 80%, with which there is no reason to doubt that the dollars are available to attend to eventual withdrawals. And although there have been withdrawals after the dissemination of this false news, they have not been significant in relation to the existing stock of deposits.

Those who complain about the subsidies should have applauded the suspension of the financial subsidy for foreign travel. Far from that, the measure was seen as a punishment for the middle class, when in reality the vast majority of the middle class that can vacation has benefited from the Pre-Trip program, which seeks to consolidate the recovery of one of the sectors most lagging behind by the pandemic, local tourism.

After the mid-term elections, the government resumed the agenda it had when it took office, attentive to the health situation but willing to heal the economy from the consequences and atrophies left by neoliberalism.