Argentina’s last economy minister warns he’s no magician

Content of the article

BUENOS AIRES, Argentina (AP) — Argentina’s third economy minister in a month was sworn in on Wednesday, and as the first order of business, Sergio Massa sought to lower exorbitant expectations for his resolution to the country’s economic problems.

He made it clear that he would not announce sweeping measures that would immediately change the course of an economy that is suffering from runaway inflation, a shortage of Central Bank foreign exchange reserves and a sharp depreciation of the peso. Argentine.

Content of the article

« I’m not super anything, neither a magician nor a savior, » Massa said at a Wednesday night press conference in which he outlined his main plans.

When Massa was first unveiled as the last economy minister, many were quick to call him a « super minister » because his post would involve leading three previously independent ministries – economy, production and agriculture.

« This team has an obligation to give answers that won’t come in a day or two, » he said. « Magic does not exist. »

Massa, who resigned as leader of the lower house of Congress, the Chamber of Deputies, to take the post of minister, brings political clout to a role that had become a hot potato amid the economic difficulties of the Argentina and the increasingly fragmented government coalition.

Content of the article

He expressed determination to maintain the target of keeping the government deficit at 2.5% of gross domestic product, which was part of the country’s commitment with the International Monetary Fund to restructure $44 billion of Argentinian debt.

Left-wing members of the ruling coalition, including Vice President Cristina Fernandez, herself a former president, have strongly criticized the IMF deal, saying it requires too much austerity and will hamper the country’s ability to grow. Argentina.

Massa made clear he had no intention of tearing up the deal, which was led by then-economy minister Martin Guzman, a moderate who quit in early July, saying he did not have the political support of the ruling coalition. Silvina Batakis, from left, was tapped to reprise the role, but lasted less than a month.

Content of the article

In an effort to combat inflation which is running at more than 60% a year and which is expected to rise sharply in the coming months, Massa said he would no longer use the Central Bank to finance government operations.

« We will be content with the resources we raise through taxes and the funding we can get from the private sector, » he said.

He also said he would continue and expand his efforts to reduce energy subsidies by raising electricity and gas tariffs, which was a key request from the IMF. Argentina is spending billions of dollars to import energy amid rising global prices following Russia’s invasion of Ukraine and pandemic disruptions.

Without going into details, Massa said he would grant special advantages to the agriculture, fishing and mining sectors with the aim of increasing exports and thus increasing the hard currency reserves at the Bank. central.

Content of the article

He said he had no intention of introducing devaluation as well as strict capital controls amid the sharp depreciation of the Argentine currency in recent weeks,

“I want to say it clearly: depreciation shocks only produce poverty and a huge transfer of resources,” he said.

President Alberto Fernandez presented Massa’s appointment as a boost to the struggling government.

“We have a great opportunity as a country. Let’s not let this get away from us,” Fernandez said.

Massa, a powerful former mayor who has long been a presidential hopeful, is seen as a pro-market moderate who has strong political clout and good connections with the country’s business elite.

He served as chief of staff for nearly a year during Cristina Fernandez’s first term as president from 2007 to 2015, but then began to criticize her as he pursued his own presidential ambitions.

Massa will have to play a delicate balance between calming markets that are skeptical of Argentina while addressing social demands in a country where nearly four in ten people are poor and protests are growing to demand more good -be.