The president Javier Milei He always made clear his contempt for public workassures that he considers it the true “political expense”, since he assumes that in every investment in which the State intervenes there is some irregularity. That’s why he The Budget item called Capital Expenditure totaled only $248,143 million in November of this year, which marked a nominal drop of 35% compared to the same period last year.
He withdrawal of the state from investment in infrastructure can take its toll later to the national government, when it wants to speed up the conditions for an exit from exchange restrictions and speed up a commercial opening, since the fall in investment itself It reduces the systemic competitiveness of the economy.
Esteban Domecq, economist and director of the consulting firm Invecq, He pointed this out a few days ago in a meeting with businessmen: “Public works are 80% down. If a route is not made, will companies be more or less competitive?”
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These are the details of capital expenditures as reported by the Ministry of Economy for November
That is what even economists closer to the ideas supported by the Minister of Economy, Luis Caputo, that the fiscal adjustment in investment in infrastructure will end up affecting the recovery and the capacity for economic growth for the future.
When analyzing the National Public Sector data from November, the Center for Argentine Political Economy (CEPA) points out that “capital expenditures continue practically paralyzed, with a drop of 76%, highlighting the reductions in housing of 84% and in transportation, of 76%. ”.
“There are no signs of reactivation of public works, failing to comply for now with the obligations established by the National Congress in the Bases Law. In the Bases Law, an article was finally incorporated to force the Executive Branch to resume those works that are more than 80% physically executed or that have international financing. It remains to wait for its effective implementation.”indicates the report.
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Public works have been suspended since Javier Milei took office.
The CEPA states that, “with regard to the expenditures for energy works, there is a moderation in the fall in expenses (-20%), driven by the reversal of the Northern Gas Pipeline” which is the little that remains standing.
The report detects that in the 11th month of the year the intensity of the “chainsaw” changed according to the items accumulated for the year. Of every $100 adjusted, $24 corresponded to public works. The second place in importance is occupied by retirements with $22.1. They are followed by social benefits that contributed $13.9, then the State’s operating expenses with $12.8 and subsidies with $12.2.
That is, at the end of 2024, due to the new pension adjustment formula, pension spending became the second vector of the adjustment. Now the pruning stops for public works.
How many works were paralyzed in December 2023
According to data from the previous management, in December of last year, the national government had a total of 2,308 works in progress throughout the country under its orbit. worth $310,000 million in November 2023. Today it would be about $824,000 million, if the effect of inflation is taken into account.
It is worth remembering that at the beginning of the administration, Milei signed more than 20 agreements with governors for the transfer of the projects at the provincial level. According to data from the former Ministry of Public Works, The largest number of paralyzed works were in the province of Buenos Aires, with 899 projects in execution. The second is Córdoba, with 197, third Entre Ríos, with 148 and fourth is Santa Fe, with 144.
In Connectivity and Road Infrastructure, there were about 514 in execution, in Integrated Water Resources Management, about 1,031 and in Urban, Rural and Care Infrastructure, about 763.
Source: Ambito

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