Government will travel this Tuesday to Brazil looking for a credit accelerate bilateral trade and reduce the outflow of dollars through imports. The delegation led by Alberto Fernández will keep a meeting with Lula da Silva and his economic team, a meeting which will be attended by the Minister of Economy, Sergio Massa, the Minister of Foreign Affairs, Santiago Cafiero, and the Argentine Ambassador to Brazil, Daniel Scioli.
The tour will come in the wake of last week’s currency run that brought the blue dollar close to $500 and imposed emergency measures to stabilize parallel prices. Among these, the intervention with reserves on bonds, the sharp rise in rates and the acceleration of the official dollar. More restrictions by the CNV to operate with financial dollars (CCL and MEP) are known today, starting tomorrow.
In this context, Massa will play a leading role in the Brasilia negotiations. The minister will arrive with his team, made up of Leonardo Madcur, Gabriel Rubinstein, Marco Lavagna and Lisandro Cleri. Madcur and Rubinstein were due to go to Washington last week to negotiate face-to-face with the IMF for early disbursements, but the minister preferred that they continue the conversations via zoom and go first with him to Brazil.
For this reason it is expected that Tigrense will not participate in the act that the CGT will carry out tomorrow in commemoration of Labor Day. There, a trade union sector was expected to promote his presidential candidacy, even if criticism could also rain on the economic situation. The minister has chosen to appear with Lula -critical of the dollar as a global currency and of the Fund- and, only after the mission, will he send his team to sit down with the agency’s staff.
The government needs to increase bilateral trade with the neighboring country, taking care of reserves. In this context, the Brazilian government has confirmed in the last few hours that it is studying a mechanism to finance exports to Argentina. The aid would come from the New Development Bank e the transactions would be in pesos and reais. However, there are doubts about the convertibility risk of the Argentine currency repay the debt in the future.
The provision had already been discussed in late January during Lula’s first visit to the country. The idea was that it would start between February and March, but it was delayed after criticism from the opposition in Brazil to external financing. “It’s on the side of raising financing to improve reserves, it’s like the yuan with China to not spend dollars, it’s to strengthen reserves through import financing with Brazil,” they explained in Economy.
Among the alternatives to study, there is also talk of “securitization” of exports finance such capital market operations through trusts or other financial instruments. Argentina put it into practice in 2003 before the closure of international banks’ access to credit due to the economic crisis, with operations of modest amounts, in the order of US$ 15 million.
Massa discussed these proposals last Friday during the meeting he held on the fifth floor of the Palacio de Hacienda with executives from the automotive, steel, engineering and food sectors. “It was a short meeting, various ideas were discussed, but we agreed to work together: export securitization and payments in reais,” they said in a car terminal.
In the industry, there are doubts about how foreign trade without dollars will be implemented. Above all, in a context in which they see difficulties in obtaining SIRA permits and the use of the yuan to import from China is still very incipient, a sort of testimonial process. The bilateral agenda also includes the exploration of investment lines that facilitate the construction of the Vaca Muerta pipeline, whose pipes come from Brazil.
The government remains concerned about the loss of reserves and continued dollarization. Despite the stabilization measures, the Central Bank sold US$67 million on Friday. And so far this year, it has amassed sales of $3 billion in the foreign exchange market. In turn, he had to put at least $100 million into the bond market to placate financial dollars. And on Friday the payment to the IMF of 700 million dollars was added.
NS
Source: Clarin
