The debt-to-peso swap launched by the government on Tuesday continues to cause a stir among economists of various political persuasions. The discussion moved to Expoagro yesterday, where the financial company Allaria organized a panel led by Marina Dal Pogetto, Emmanuel Alvarez Agis and Hernán Lacunza.

It was a lively discussion, which attracted the attention of some 300 people who crowded into a tent (some sitting on the ground) with little air conditioning.

“Providing a double bind that gives the creditor the choice between devaluation and inflation, whichever suits him best, is costly. If in addition to that we give them the option to sell the bond at any time, it is directly a user operation,” said Lacunza.

This was the response of a “ministerial” to Alvarez Agis, who recalled his proposal to make a “Moncloa Pact” which the government and opposition should sign at least as regards debt management. “As long as the government is there, it says what effort it is willing to make.” Agis acknowledged that this is not easy to achieve because there are doves and hawks on both sides “and as far as I know the coexistence between hawk and dove is never good”.

Dal Poggetto intervened with a dose of common sense: “You don’t need a Moncloa. When it comes to debts, contracts must be respected and above all, don’t go around saying through the media that it won’t be paid.” The Eco Go economist said summarized: “It is not a credit problem but a solvency one”.

Dal Poggetto added that “All the debt in pesos will eventually be indexed. The Government got longer terms but it was expensive, because it will pay 8 points above the CER. And as for the put (the BCRA will buy all the bonds that are sold before expiry) said that this is nothing new. It was done last June to avoid a sharp inflationary jump”. Finally, he predicted that this government will avoid exchange rate corrections and leave it to the next one.

And the trap?

For Lacunza it will not be the first measure taken by the next president. Not before a year if things are done right. Lacunza had no qualms about notifying rural producers that they didn’t have to wait for a drop in withholdings in the early days of an eventual government set for change. “I can’t tell you that we will lower taxes: the first thing is to achieve fiscal equilibrium and the stabilization of the economy. To lower taxes, you must first lower spending”.

For its part, Agis specified that the problem it is observing is that the economic policy instruments are ideologised: “Guzmán had to leave because he wanted to make an adjustment and Massa makes the adjustment but badly. We cannot criticize those who come to the ideology”. “. And he closed:” In the country that comes, they take everyone, for six years. The current level of severity is so great that the next government can fail in 40 minutes if it doesn’t act responsibly.”

Dal Pogetto concluded that “There is a margin so that everything doesn’t explode but the rope reaches the neck. How do you define 2024? Cooperation or non-collaboration. With the exchange we have seen a certain collaboration, albeit at a high price. Cooperation will continue “We’ll see. The lack of dollars is what complicates the year. That’s why it’s crucial to increase the horizon and the governability. Otherwise, not even Mandrake can fix it.”