Mary Church
08/25/2020 - 20:17
- Clarín.com
- Economy
- Economy
With generally antagonistic profiles and ideologies, the economists Emanuel Álvarez Agis and Daniel Artana agreed on various aspects in relation to the dollar, rates, request for dollars from the International Monetary Fund and characteristics of the recovery in Argentina.
Regarding the exchange gap, Álvarez Agis, who was Vice Minister of Economy in the management of Axel Kicillof, acknowledged that it is at unsustainable levels to which he found two ways out . "Stick or carrot," he diagnosed in ironic style. The first would be to cut the $ 200 per month, but dollar deposits would end up falling, he reasoned; and the second would imply understanding that there are two markets: the official and the parallel. "So if you believe in managed administration, you have to do it in both types of changes," he said.
Dollar
Specifically, it would be necessary to raise the interest rate, offer instruments tied to the dollar and that the Central Bank, after the debt swap, sells bonds that it has in its portfolio , he mentioned in the webinar "Economic challenges after the debt agreement" , organized by Ad Cap.
Artana, an economist at the FIEL foundation, agreed that "you have to try to use all the instruments . " Asked about a possible split, he described that in his opinion it would be a better scheme than the current one (even with the problems it would pose) and that in a scheme in which he predicts that inflation will accelerate in 2021 to 60% per year , which implies With a CPI of 4% per month, the dollar should keep pace with this rate of change.
“The Government always thought of the stick. It complicates because the game that is being played is not well understood ”, he added, a point that made a difference with Alvarez Agis, who does not believe that a higher rate of devaluation will be useful because of the impact on inflation of this possibility.
This economist, director of the consultancy pxq, described as "crazy" that the government has publicly discussed the saving dollar, and reiterated that he sees a devaluation unlikely.
Rates
After more than a year in which the rates for public services, such as electricity and gas are frozen, both Artana and Álvarez Agis agreed that progress should be made with an update scheme, maintaining social rates (and that these are even perhaps more extended, given the impact of the pandemic).
“The Treasury will not have more money to put . At some point you will have to give a signal. You have to apply what is good regulatory practice: you have to have a moment of transition, but you cannot live off the fantasy of giving away electricity and gas, " said the FIEL economist.
“Anything that freezes today is more headaches tomorrow. If you have to pay a huge fee, you will pay a huge cost, "added Artana, to which Álvarez Agis added:" We are in complete agreement. " And he described that there is a segment of the population in Argentina that must be raised by 75%. “They have been frozen since April of last year. Electricity and gas except for those who cannot pay, for the rest it has to be somewhat expensive . Even from the heterodox point of view: they are dollars that I save to import screws ”, he exemplified.
Post pandemic
Both economists see that the economy has begun to walk the path of recovery , although they warned that this rebound will find a limit.
"Our impression is that it is going to begin to draw a square root shape," Álvarez Agis mentioned in relation to the form of the recovery, when a graph is shown. “The offer was not that it was destroyed but that it froze: that is why the rebound is going to be fast. But our impression is that the demand shock is not going to keep pace, "he warned.
In a similar vein, Artana mentioned that the economy will rebound in 2021, with consumption that will do so at a slower pace, but even so next year it will only recover half of the fall of 2020. "Exchange controls and regulations they will continue, beyond what could be justified. This exchange control has damages on the economy. It is exaggerated, it is not normal. You have to see if you can relax, "he added.
Negotiation with the IMF
When the Government prepares to begin negotiations with the International Monetary Fund, to refinance the debt with the agency for US $ 49,000 million (between capital and interest), both Artana and Álvarez Agis consider that Argentina should ask for fresh dollars, beyond of the refinance itself.
"Some points of the financing needs for next year should come from the IMF, despite the government saying no," he reasoned. And he said: "They started the negotiation well, saying they did not want extra resources."
Artana also recognized that in the IMF negotiation it would be good to get extra dollar financing . "The maximum we can aspire to is that they give us to cover interests with the IMF and international organizations next year, about US $ 3 billion," she calculated. “That they gave us US $ 44,000 million was a political question, not a technical one; something out of the ordinary ”, she calculated in relation to the loan that the agency gave to the Government of Mauricio Macri.
Public accounts
Daniel Artana calculated that next year the primary fiscal deficit (the one calculated before paying interest on debt) could be 4% of GDP. And he celebrated that the data for July, the latest available. “It is auspicious; a reduction is noted and there is a certain fiscal prudence. The question is if they will be able to maintain it in the electoral year, "he said.
Álvarez Agis stressed the changes that should be made in the pension system. "It doesn't matter if the IMF asks for it: the government has to do something with pensions," he said.
