In a more cordial climate although with several darts of own and foreign, the Minister of Economy, Martín Guzmán, along with other officials from the economic area, presented the agreement with the IMF before the Budget and Treasury Commission of the Senate. Although it is presumed that the vote will once again be favorable to the Executive, the debate once again left material to cut in relation to the internal politics suffered by the Frente de Todos. There was also reference to the withholding situation, where the rise for agricultural by-products is evaluated. Guzman said that the extraordinary situation of international prices due to the war it requires the State to have more intervention tools.
First it was the turn of the presentation of Minister Guzmán and the Chief of Staff, Juan Manzur. “The agreement will allow build certainties in a context of uncertaintiesbased on being able to count on financing to face agreed maturities in 2018 and give continuity to the strong economic recovery that Argentina is experiencing,” Guzmán said. He stressed that “being able to give it legislative treatment was of great value. For the first time in Argentine history we can have this debate, which is a step forward for our republic when it comes to strengthening ourselves as a nation state. It is not healthy that a government in office can act without broad support.”
Likewise, Guzmán stressed that “andhe agreement reached by the Government with the IMF staff is different from the previous onessince it does not provide for a labor or pension reform, none that will remove rights.” “From the macroeconomic point of view, the agreement has three objectives: the accumulation of international reserves, a fiscal path and monetary strengthening,” added the head of the Treasury.
For its part, Manzur considered that “this agreement, which is here today in the National Senate, is the best possible agreement” and repeated the hint to his own troops that he launched in Diputados saying that “A critical look is no reason to encourage a vote against at this particular juncture.”
Cruces I
On the opposition side, Victor Zimmermann (UCR-Chaco) highlighted the will of the Executive “to avoid a default of the debt and the opposition of Deputies in accompanying the initiative”. He consulted the Government about possible tax revaluations, increased withholdings and rate variations. He also questioned that the program agreed with the IMF aims to establish real interest rates, which would complicate financing for production.
Guzman replied that “the fiscal deficit will be reduced on the basis of a policy that underpins the economic recovery. A moderate expansion of real spending is sought, more investment in public works and the reduction of energy subsidies.” Meanwhile, the head of the AFIP, Mercedes Marcó del Pont, said that “We are considering the rise in income by improving the tax base of the higher-income sectors.” He referred to the personal property tax as a progressive tribute and to the decision to revalue Buenos Aires real estate by multiplying the values by four.
Meanwhile, Gladys González (Together for Change-Buenos Aires), asked Guzmán how the Government is going to reduce subsidies in the current scenario of strong rise in international prices and in the midst of the increase in the number of households receiving benefits as a result of the cold zones law passed last year.
“There is a firm commitment to reach the objective of reducing subsidies”, Guzmán repeated, and recounted that after his meeting with the oil companies in Houston, United States, he received messages of interest to invest in energy production and infrastructure. He also said that the energy sector requires easy access to the foreign exchange market “so that there are investments of scale.”
For its part, Alfredo De Angelis (Together for Change-Entre Ríos), asked Guzmán if the Government is going to raise the withholdings or not. The minister said that the world is experiencing a food price shock and that “Doing nothing implies that this situation results in additional pressure for millions of Argentine households. The decisions that are made have to do with the nature of the problem we face, which has few precedents at a global level.” Meanwhile, Manzur said that “we have to understand this in a context of absolute exceptionality”.
Martín Lousteau (UCR-CABA) asked Guzmán to “explain clearly what the consequences of a non-agreement would be” and recalled the position of the ruling party in Deputies, which did not fully support the Executive’s proposal.
Crosses II
Inside his own troops, Maurice Closs (Front of All-Missions), said that “it is not an easy agreement to vote on because no agreement with the Fund is easy to vote on, although it is extremely necessary in this state of affairs in the country“. He asked Guzmán “at what point did he realize that he was not going to be able to achieve either a reduction or longer terms or a reduction in surcharges.”
Guzmán responded that “the Fund does not make haircuts, for there to be changes in general conditions there must be willingness on the part of the countries that make up the organization. Argentina raised in the multilateral arena the importance of a line of resilience and sustainability and the G20 supported that premise. It goes towards that. On the subject of surcharges, the discussion is still going on.”
Senator Guillermo Snopek (Frente de Todos-Jujuy), asked Guzmán if “the Ministry of Economy knows how many Argentines sleep on the street” and questioned the Ministry of Labor “for not having a labor inclusion plan.”
The head of the Treasury replied that “youEverything we do seeks to solve the problems of poverty and homelessness and that there are better job opportunities. For that, it is important to resolve the main macroeconomic problems and prevent a situation of enormous damage to Argentina from materializing.”
For his part, Marcelo Lewandowski (Frente de Todos-Santa Fe), told Guzmán that “the increase in the cost of the basic food basket is worrying, beyond the war in Ukraine” and added in relation to the issue of raising withholdings that “hopefully the measures reach the table of the Argentines, because many times there are more distortions than the benefit that ends up being generated”.