One of the maxims of the former Uruguayan president, Julio María Sanguinetti, is that “In a democracy, what you avoid is much more important than what you do.”. What did Sergio Massa try to avoid with the repurchase of a small part of the debt?
The provision, just in the week in which truck drivers and protesters attacked supermarkets, was read as an attempt to regain the initiative in a climate of “turmoil” with the rise of blue and its impact on inflation. A shadow on the economy.
They say the economics team has been analyzing this for some time. Has anyone leaked the secret? On Tuesday, 24 hours before the announcement, there was a higher volume of bond trades. A few have made a difference by buying them at an ignoble price to resell them to the Treasury.
Difficult to identify who they were in an Argentina where AFIP knows everything. But the National Securities Commission shrugs when it points out in the case of transactions that are concluded abroad can’t go beyond the broker’s name.
Lisandro Cleri, deputy of the Central, motorized this repurchase where the body will be an intermediary in a transaction where sacrifice 10% of your net reserves in the name of narrowing the exchange rate gap.
These offices appreciate the recent swap concluded with China and which was made official at the meeting of central bankers in Basel, Switzerland. They say they are US$5,000 million freely available due to the US$ 8,000 million trade deficit that Argentina has with the Asian giant.
Its use is expensive with a rate that private companies place at 8%, 2 points higher than what is paid to the IMF today.
One banker rated the buyback as a test ball for the size, which is small as it amounts to 1,000 million dollars, but important as a signal: “It shows that they are willing to honor the debtin a context that due to the size of the deadlines there were too many doubts towards 2024”.
Part of these fears are fueled by the debt in pesos that reaches 14% of GDP, half in the public sector risking pensioners’ money. The other half is distributed between banks, mutual funds and insurance companies. If there is trust it is manageable, assures the banker who concludes:“They come, it doesn’t explode.”
For Andrés Borenstein, chief economist of Econviews, “the goal is to reduce the gap. The idea of improving the debt profile is fine, but it will not be possible to access the markets and dollars that do not exist are used”.
In other areas, such as mass consumption, what is no longer there is trust. A chief executive said they didn’t even contact him to warn him that “heavy inspectors” were on the way, despite a daily report. They pile up all kinds of reproaches. Curious, because in those companies they describe Massa as a minister who respects agreements and advises when he cannot do so.
Against this background, the report of an analyst of an investment bank attracted attention. “There is internal chaos and movement that is part of ingratiating yourself with Cristina Kirchner. The main problem is inflation, if they bring it down it will reactivate. But an outgoing government doesn’t sign price and wage deals to stop indexation.” Without this possibility, there are truckers to punish.
In warehouses and supermarkets they noticed coordination as they were deployed simultaneously and without warning at the appointed time. Private individuals experience it as a provocation in the midst of a competition with supermarkets that they ensure that the producers do not send what is requested amidst the high demand for fairly priced products.
There are complaints of orders that are at best half-completed due to production bottlenecks and the ability to sell them at a higher price in self-service shops that do not participate in the programme.
There are other curiosities. Neither the truckers nor the protesters went to the food producersS. This explains why Copal, which brings them together, has not issued a statement of repudiation. Nor did the super ask for solidarity in the face of Pablo Moyano who they know very well because they live protesting the unionization of employees.
For the economist Pablo Madanes, “a fundamental element of Massa’s resistance plan consists in having an index around 4% stabilized for April. It is one thing to achieve this through a change in expectations resulting from deficit reduction, monetary issuance and a real influx of dollars. And another is with major crackdown on price controls and increased inventory turnstile, multiplying differential exchange rates and increasing the chaos of relative prices”. One fact: in Economics prepare a dollar of soybeans for march 3.
The UIA, on the other hand, is preparing for Lula’s arrival next Monday. In the industrial center they took note of what happened in the powerful Fiesp which expresses the industrialists of São Paulo. They ousted the president, José Gomes da Silva, by 47 votes to one. none other than the son of José Alencar, who accompanied Lula as vice president during the 8 years of his administration.
A way to mark distances in the midst of a fractured Brazil. Paulo Skaf, former president of Fiesp for years, has openly declared himself pro-Bolsonaro. The news was a bucket of cold water for Daniel Scioli.
The Brazilian lands with a large delegation of industrialists, many of them in the fields of refrigerators and textiles with a strong presence in Argentina. “Lula at Planalto can help better integration of Mercosur into the world. In particular, it can revitalize the Mercosur-European Union agreement, which would be fundamental for an Argentina which, since the crisis of 1930, has been affected by European protectionism. In such a polarized Latin America, Lula also plays a stabilizing factor”, commented the former rector of Di Tella, Ernesto Schargrodsky.
Vernacular industrialists seem to have taken note. They decided it is better to continue with Daniel Funes de Rioja as president than to try some changes in this challenging 2023 and before the start of a new government. There will be a list of units and a renewal by acclamation for those who said they would only serve for two years.
In view of all this, Guillermo Michel of the Dogana shows that he wants to “break the big business that consists in operating on the exchange rate gap”. The new mode for imports detects if a precautionary measure has been requested and in this case it is automatically excluded.
Thus, it eliminated $2.6 billion in court orders. And opened a special green channel for Vaca Muerta, medicinal supplies and fertilizers for the camp. Michel confesses that he receives constant requests from governors such as Bordet of Entre Ríos for resins for the forest industry.
Much is left out. In a letter to Sergio Massa, Trinidad Tizado, president of Tubos Trans Electric, a leader in large electric transformers, revealed another aspect: the delays in more than five months in approving the procedures to be able to import.
These are the INTI’s Temporary Import Classification Certificates. “These inputs are needed for production, delays are generated, and the continuity of electricity supply in power plants and wind farms is at risk, as are high-value-added exports to hard-to-access destinations such as the United States,” he said. described .
“Later, we wondered why no investments came in,” another businesswoman was dumbfounded when she said a Brazilian fund that came in to add a company at a ridiculous value stalled the bet last December.
Of course, at the world’s largest investment fund, BlackRock, with stakes in YPF, they deny that Argentina is off the radar. “We analyze everything, always. Even a broken clock shows the correct time once a day.”, slide into an obvious allusion to the functioning of the country.
In the meantime, it was decided to issue larger denomination banknotes. It will be $2,000 and $5,000. In this way a maxim of Cristina’s who always opposed the most valuable ones in order not to officially validate inflation is broken.
In the midst of an economy that won’t give up, there have been hours of debate over who the faces of the new bills will be. It has even been proposed that they were writers like in Uruguay. They opted for heroes. Unlike what happened with the repurchase of bonds, with a secret that stood up for the benefit of a few, this time the name of those heroes, women and men, is well preserved.
Source: Clarin
