The Minister of Economy, Luis Caputo questioned the governors last night, after the negotiations for the omnibus law became tense and the project fell in the Chamber of Deputies. “One of the problems of the negotiation is that the provinces made a poor evaluation of their negotiating power. They believed that “They had much more bargaining power than they had,” evaluated in dialogue with Luis Majul, on LN+. Furthermore, the official warned: ““Everything is a job in this country.”
“Now that I have the Infrastructure area, I see all the companies and everything is a job. Let it be clear to people, that’s how it is. There are kiosks everywhere. and this law, to a certain extent, is also going to combat that,” defended the head of the Treasury Palace.
He maintained that “between 70% and 75% of the fiscal package was not in the law” and remarked: “We are dealing with people who do not want change.” “We have been tougher with all the items with the transfers to the provinces and with public works,” said Caputo.
After the project fell in the lower house, the minister gave details of how the negotiation with the governors was frustrated and referred to the anger on the part of the President. “The majority thought ‘minister, you are going towards fiscal balance and you have to achieve 1.4% of GDP, You are going to come with a tired horse.’ Y I had a plan B and I saw that we were going to zero deficit even without the law”, said. Along these lines, he ratified the economic plan, even without the Base Law: “We have on the one hand what the economic package is and on the other hand what the law is, and they play two different roles.”
In relation to the discretionary transfers to the provinces that the Government is cutting, he said that the money that legally has to go to the provinces “is going.” “The other day he heard complaints from the government of the province of Buenos Aires, but without sense. We are making the same policy for everyone. The money that belongs to you is going. I manage the discretionary ones, which is the money that the Nation used to give to the provinces to do politics.” And he said: “There is no need to get angry, “Each one defends his own thing.”
Also, he returned to his statements after the setback in the Lower House, where he asked “not to dramatize.” And he explained: “What happened yesterday is not a disaster. I imagined the people on the other side – being brutally honest – with a concern that I as a minister did not have. So the interpretation out there seemed to me to be, as far as our plan was concerned, exaggerated.”
“We know that We are dealing with a lot of people who don’t want change. We more than anyone We knew we were going to have resistance, That’s why the design already took that into account. Most of what the fiscal package is was not in the law precisely because one of the possibilities – not low – was that it would be delayed,” he specified.
The minister once again defended the omnibus law project, which is expected to be withdrawn from Congress, as the President anticipated this Wednesday. “It was for the Argentines, it was not for the Government. It was for another purpose, more medium or long term, so that once the economy was stabilized, the foundations would be laid for the private sector to push the country as best and as quickly as possible. Take the foot of the State out of the people’s heads. Deregulating, eliminating kiosks, simplifying tasks, things that people suffer.”
Inflation and prices
Caputo anticipated that the January inflation rate will be close to 20% and maintained that the Government is not responsible for this number. “It’s obvious,” he said, which is why he accused the previous management of the “paid plan, that are having their effect now.”
“Inflation slows down due to a combination of several things. We stopped hitting the machine. In fact, since we took office, the monetary base has not grown even in nominal terms. What is the broad base, which is the entire issuance of pesos from the Central Bank (normal base plus remunerated liabilities) fell 20% in real terms. We are strongly rebuilding the BCRA’s balance sheet. Liabilities fell 20% in real terms and reserves grew 20% as well,” stated the Minister of Economy.
And he continued: “The fiscal anchor works like anchor of expectations. It is the commitment that We are not going to spend more than we collect. That is to say, the BCRA is not going to be issuing pesos to the Treasury so that it can spend spuriously. Besides, People are watching prices. We did not see inflation as high as the economists said because we knew that people were not going to validate it.”
“Weekly inflation for the last two weeks gave 1.5% per week, when we assumed it was 1.5% daily. “Clearly we are seeing a significant slowdown,” Caputo highlighted. And he stated: “There was no better solution than this and things are turning out better than we thought.”
“There has to be a change and those who do not support do not want changes. You’re going to have to get through this difficult time. There are no alternatives, the option is much worse and this time it will give results. We are not fooling people, “We are going to solve the problem and things are going to go well for us,” he concluded.
Retirees
The minister assured that “the income of retirees “The last government liquidated it” and that “they lost between 15% and 40% in real terms of their purchasing power.”
In this regard, he announced that the formula for updating pensions will be changed because “they lose money” and specified that it was taken out of the bill “to be sent in a new fiscal package.”
“If I didn’t give them a bonus and we didn’t change the formula directly we eliminate the retirees. “What we are proposing is to change that formula, which is very bad,” said the minister.
Themes
Other news from Luis Caputo
:quality(70)/cloudfront-us-east-1.images.arcpublishing.com/lanacionar/QFNCQAESWRAN3B43JAJ4AQ5TOQ.jpg)
Controversy by the group. What is the impact on the provinces of the removal of Government subsidies?
:quality(70)/cloudfront-us-east-1.images.arcpublishing.com/lanacionar/EQ4BVK5Q2VFKXP7FRY2PZ7WKL4.JPG)
Maximum tension. The removal of the transportation subsidy outraged the governors, who interpret it as revenge
:quality(70)/cloudfront-us-east-1.images.arcpublishing.com/lanacionar/PELKP7JBOJG7TJ5VOHDOLVIBJQ.JPG)