The Government expects an inflation of 33% and a fiscal deficit of 3.3% of GDP in 2022

09/16/2021 12:04 AM

• Clarín.com

• Economy

Updated 09/16/2021 12:04 AM

The Minister of Economy, Martín Guzmán, and his technical team of collaborators sent the 2022 Budget to Congress last night, complying on time with the delivery of the text to Parliament for its treatment, and which assumed a key agreement with the International Monetary Fund.

The expected growth for next year is 4%, inflation 33% (45% this year), the primary fiscal deficit 3.3% of GDP (4% of GDP this year).

Those are the main variables.

The dollar for December of next year is expected at $ 131.10.

President Alberto Fernández had already confirmed this during a ceremony at the Government House, yesterday being the legal date for the presentation of the Budget.

The President anticipated that "by the way, next year external commitments will not have to be met, but the reality that requires a negotiation with the Fund to continue, to achieve it, to achieve it."

In this way, Fernández ratified not only the presentation of the Draft General Law on Expenditures and Calculation of Resources of the National Public Administration, as defined in the Budget, to the Parliament, but also took for granted that the agreement with the IMF will be achieved in the next few months.

“Reality requires us to move forward with the IMF. If that agreement did not exist, the conditions would be different; It would be different in the possibilities that the State has in promoting the development that we want to promote and public works, education, health, credit for the company would be affected, ”he said when presenting the draft Law on Hydrocarbon Investments.

"The truth is that if that agreement did not exist, we have to face the payment of US $ 19,000 million next year and the conditions would be different," explained the President this afternoon, accompanied by Minister Guzmán (see more on page 18) . The text that was sent last night to Congress contains the calculation of the service of the internal and external public debt, and the maturity profile detailing the concept (interests, amortizations, commissions) and type of creditor.

In recent weeks, the Government anticipated that the main guidelines of the 2022 Budget will be oriented to economic reactivation, from which definitions of expenses and income are ordered based on a scenario of growth of the expected Gross Domestic Product, the level of inflation and the evolution of the exchange rate, among the main variables.

Like any budget, the project will also include estimates of the fiscal deficit, and the items that will be allocated in the different areas, taking into account a context of greater economic activity, which is expected to be less affected by the pandemic.

For this year, a growth of between 7.5% and 8% is expected after falling 9.9% last year, a deficit of 4.5% -for which there is an expectation of overcompliance due to the evolution of collection-, with an inflation estimate below 50% and a dollar at $ 102.40.

The Ministry of Economy had started in April the path of shaping the budget while announcing the design of a multi-year budget 2022-2024, and in the previous one, the portfolio was working on a project that would allow “to consolidate economic growth and improve conditions life of Argentines ”,“ During 2022, the national government will direct resources towards policies aimed at productive dynamism, public and private investment and job creation.

Productive synergies with the private sector will be boosted and promotion programs for productivity and competitiveness of companies will be strengthened, with priority on MSMEs ”, highlighted in a cable to the Telam news agency.

Guzmán is in favor of reaching a fiscal balance as quickly as possible.

On the other hand, in La Cámpora they prefer to advance more gradually. The minister advanced in a strong reduction of the fiscal imbalance in the first seven months of the year (0.7%).