Ezequiel Burgo
08/04/2020 - 6:00
- Clarín.com
- Economy
"Negotiating with creditors was a piece of cake for Argentina compared to what awaits it . " This is how he describes the next stage for the Government and the country, a source aware of the conversations between the bondholders, President Alberto Fernández and the Minister of Economy, Martín Guzmán, in all these months. "Now it is the turn to show the cards and the Monetary Fund will ask Argentina what plan it has. It will be more difficult than negotiating with BlackRock . "
The salient feature of the Guzmán agenda, from now on, will go more mechanically than the etymological of the term economic plan: how he plans to reverse the $ 3 trillion fiscal deficit that the Secretary of the Treasury, Raúl Rigo, projected for this year at a meeting with deputies last week. It will be the first thing that the IMF will ask Guzmán when he requests to kick the maturities for US $ 50,000 million that the country must meet between 2021 and 2023. The IMF will want to guarantee that it will collect that money and will agree to refinance the debt only if Argentina makes an effort. to recover payment capacity and make its liabilities sustainable.
The government's political wing is confident in how Guzmán will carry out the negotiations. At the moment, it is more a hope than the product of a conscientious exercise with numbers. Close to Fernández they argue that Guzmán has "contacts" and a language close to that of the IMF economists, owner of an empathy that perhaps he did not have with the investment fund analysts. “Guzmán spoke to them with the macroeconomics manual and the creditors with the value of the offer. With the IMF staff they will understand each other more, they are more academic . ”
This vision perhaps underestimates the work and the organization of the Monetary Fund that await Argentina. There is no doubt that Georgieva will support the minister. How she has been doing it and how Lagarde did it with Dujovne. The IMF always supports its member countries. It is pro-authorities. It will surely take time to greet the progress the country has made with the private sector and will welcome conversations with its staff.
But in a moment Guzmán's macroeconomic projections will reach the excel of the IMF departments. And the agency will require Guzmán that the plan have the same consistency that the rest of the countries comply with. More now that there will be more members under the orbit of a program: the agency will not be able to make exceptions. "The IMF is a very good institution putting together very large packages in very fast times, but bad at adapting the operation of the programs to the needs of each country," said an important IMF authority not long ago. He knew whereof he spoke. The agency reacted quickly to Argentina's request in April 2018 (for many too fast) but then was slow to respond to requests for modifications to the standby. Would Guzmán have calculated this?
Economist Marina Dal Poggetto, director of Eco Go, gets to the point. Immediately she says that Argentina should give a signal in the fiscal area. "For example, explain how to move to a primary fiscal deficit of the order of 2% of GDP . " It is estimated that this year it would reach 8%. "That would imply a short-term program and a reordering of the macroeconomy: agree with private parties, postpone maturities with the IMF and give a signal on the fiscal side . "
There is a joke about the IMF that says that the acronym of the organization in English (IMF: "It is mostly fiscal" , in Spanish, "It is almost all fiscal" ), honor their eagerness to put in order the public accounts of the economies. And this is something that Guzmán has not yet made explicit and is central to his work: how he plans to lower the largest fiscal deficit since the return of democracy . The reordering of the State will be a task that demands a plan .
