The Minister of Economy, Sergio Massaassured this Sunday that “the objective of halving the inflation we received did not change”while stating that the agreement with the International Monetary Fund is “enforceable”.
“The most difficult thing is to manage expectations, especially since I had to assume a political and economic crisis: inflation of 7.4, negative reserves, with a huge deterioration in the trade balance; and also with relative prices that are absolutely out of place,” he said at the program connect2 in CNN in Spanish.
For Massa, “the need to respond, to use time well so that these responses are forceful and not magical, sometimes collides with the expectation, with the desire of the markets, of the workers to recover their income, of society for living with a much more logical inflation and not with the one we have to live with today”.
“The first challenging constraint we have for the next 12 months is to imagine How do we find a point at which we are attractive to all that is the Argentine agro-export sector?, because that weighs us in reserves; because Argentina needs to accumulate reserves, but also how we use them to sustain the level of activity,” he said.
The head of the economic portfolio raised the need to understand that “it is important that each Argentine SME, that each Argentine company that produces goods, have the dollars to increase the supply of goods because, ultimately, part of the inflationary problem has to do with two and a half years without access to credit, financing ourselves with issuance, with a 6-point deficit only leveraged on assistance from the Treasury”.
“You had to support companies, you had to support the income of people who were in the informal sector and had to pay their minimum bills at the end of the month; and well, all that is like at home: if you finance yourself with the card and not you have income and you do not generate income with work, there is a moment when the card interest item becomes a mountain difficult to absorb and it is time to stop the ball, to put order, to work seriously, “he explained.
Therefore, he added that it is necessary to “take measures that are not the most pleasant: when one becomes rigid when it comes to controlling spending, when one becomes methodical when it comes to meeting the objectives that Argentina has signed internationally, when one becomes obsessive that public investment has a real impact and does not It is simply the distribution of weights to jurisdictions, it has to do with using well, with using the resources we have in the best possible way”.
Regarding the multiple exchange rates, he indicated that “Argentina has to move towards simplifying this process, trying to balance the input and output piles of production goods, consumer goods, and trying to balance the piles of what are products of luxury or products that already have prices in some way dollarized”.
According to Massa, “the objective of lowering inflation to half that we received, which is somewhat the initial message that we gave, did not change. At the time we planned, we did not think that we were going to have a drought that (…) it changes everything.”
In another order, he affirmed that “the debt in pesos is absolutely sustainable and it will also be clear and demonstrated in the next few days, when we finish closing the second quarter, which is the only one this year that has, let’s say, a strong component, not intra-State, but a strong component of the participation of banks, mutual funds and insurance companies”.
“Not only is it not unpayable, but after the second quarter, the next government will have a much better profile and curve for 24 and 25 than this government had when it started in terms of product,” he remarked. .
When asked if the agreement with the Fund is enforceable, he stated: “Yes, of course, yes, yes”, while clarifying that “the proposal has to be how we multiply the generation of dollars from the four advantages that Argentina has for the next years. And that has to be the fundamental discussion of Argentina”.
“The challenge of stabilizing by lowering inflation without generating damage is a challenge that all of us who assume responsibility for this crisis set ourselves and no bad result in a game is going to get me out of the fight in the championship to lower inflation,” he concluded. .
