The Government will today launch its plan a lighten reserves with the debut of the “sour dollar” and a sanctions regime intended to speed up exchange settlement. These are some of the measures with which Sergio Massa tries to recover part of the Reserves of $5.8 billion losses that the Central Bank has lost so far this year and which complicate the implementation of the program with the IMF, despite the recent easing of targets.
The minister reached an agreement with the grain companies last week after major tussles. In essence, he stands firm in his resolve to avoid a sharp devaluation in an election year. The cost was that in the first three months the BCRA sold just over US $3.4 billion in the foreign exchange market, one of the exchange rate’s highest levels in years. The rest vanished with debt payments to the IMF and private bondholders, plus bond buybacks.
In this challenging scenario, the package that will enter into force today contemplates a first DNU with a third round of the soybean dollar for 45 days and one dollar for regional economies for five monthsin both cases with an exchange rate of $300. This is a price 42% higher than the current official dollar and an improvement in real terms compared to the value of the incentive in September and December, according to calculations by EcoGo.
In this way, the Government expects to liquidate around 15,000 million dollars between April and September, a calculation that could suggest the launch of a fourth version of the incentive for exporters, ie higher than that envisaged by private individuals. balance estimates a settlement of US$8.9 billion over the next five months and EcoGo, for a total of US$9,200 million in the first quarter, including the outstanding balance due to the commercialization delay.
To access the benefit, exporters must meet several requirements, including have exported in the last 180 days. Regional economies must participate in the official price schedule, maintain employment and ensure volume and supply in the schedule. And for soy, the Central Bank it will maintain restrictions that make access to credit more expensive because it maintains a grain stock of more than 5% and prohibits the purchase of finance dollars.
Grain companies are waiting to hear the fine print on how withholdings will be recorded and paid. For now the measure it will increase costs for animal feed and field rents. A second decree, however, will suspend the CUIT and access to the official foreign exchange market (MULC) for companies and directors who not liquidate their currencies in the stipulated timewith the goal of bringing in US$3.7 billion (0.6% of GDP).
The initiative will be closely monitored by Washington, where Massa will travel on Thursday to participate in the spring assembly of the IMF and the World Bank, and will continue the negotiations on the “bridge” that Alberto Fernández spoke 10 days ago with Joe Biden in the White House. After that talk, the IMF relaxed and reduced its reserve target by $2 billion. Now they seek US$3,000 million from multilateral organizations and trade agreements.
In its latest staff report, the Fund estimated the impact of the drought at US$5,000 million – less than private companies expected – and warned of increased risks to the program due to the accelerating inflation, lower global growth and higher spending represented by the pension moratorium. Despite the change in reserve targets, analysts estimate the government will struggle to meet them.
The Central Bank must accumulate $4,177 million in March, $9,077 million in June, $9,477 million in September and $10,277 million in December. On March 23, the Fund estimated net reserves at $3.2 billion, and the BCRA then sold $500 million on the market. Because of this, economist Fernando Marull estimates it was closer to $2.7 billion in March.
That means it should ask for a waiver“(exception) in the July review, but Massa tries to avoid it with his trip to the United States.
Source: Clarin
