-“Things are going better than expected”admits the economist Marina Dal Poggetto.
-“Will the reforms come out? Patience”asks Federico Sturzenegger what the prospects are for the deregulation that he proposes with the DNU and the Omnibus law. “It will require a process and for that the Australian model of the 1990s is worth remembering.”
It seems like the world is turned upside down. Hand. Dal Poggetto, an economist who is critical of Milei’s proposals to eliminate the Central Bank, remove rennet stocks anddollarize, recognizes the results from December to the date of the economic plan. And Sturzenegger, champion of shock, cites Australia’s economic take-off under the command of Bob Hawke and Paul Keating: it was something that did not happen overnight but gradually, as he explains in his book I don’t want to leavewhere it says so The key to the Australian miracle was a gentlemen’s agreement with the unions to carry out economic reforms.
The counterintuitive and non-obvious positions of Dal Poggetto and Sturzenegger invite something unusual: think. And the government moves in a clear direction, trying to avoid obstacles that come in its path and instead of resorting to orthodox tools, it chooses unconventional ones. And if you stop to think about it, when you talk about a billiard player like Milei, it makes sense to talk about Dal Poggetto and Sturzenegger.
“Milei always doubles and it’s not bad -says Dal Poggetto-, His fiscal adjustment is orthodox but his economic policy has heterodox components.”
Sturzenegger and Dal Poggetto spoke on Friday morning at an event organized by the IAE Business School, the business school of Austral University. Also present was the chief economist of the BlackToro fund, Fernando Marengo,
“The Government devalued but without removing the shares, it increased the PAIS taxallowed importers to pay in installments, lowered the interest rate and he gave priority to fixing the Central Bank instead of eliminating it -Dal Poggetto listed-, they are all heterodox components that have led you to move away from dollarisation, from the closure of the Central Bank and for now from the exit from equities.
Economists, in general, today agree on this pointThe results in the first hundred days have exceeded most expectations. THE inflation lower than expected, the government recovered the twin surplus and the country at risk fell 1,000 basis points. In any case, the split between analysts occurs because while for some Milei’s successes are due to fiscal orthodoxy, for others, including Dal Poggetto, they derive from what the economist Silvana Tenreyro, a former official of the Central Bank of England, according to which Argentina It was necessary: not to close the Central Bank and cause a shock by announcing a plan and a gradual implementation.
“Negotiating with reality”we read in this week’s Vectorial report from the consultancy firm directed by Eduardo Hecker, former director of the Central Bank in the previous government, also appealing to the Tenreyro concept: the fiscal adjustment for President Milei is non-negotiable, as is the shift at 2% -Do not move the official dollar until the harvest currencies come in- and at the same time postpone the increase in gas and transport tariffs from May to April. “All this comes on top of intervening in joint negotiations and conversations with supermarkets in what constitutes a disorderly and unorthodox move.”
For their part, the economists of the consultancy firm 1816 also agree with Dal Poggetto and Vectorial: “Both Milei and Caputo talk about aiming for mid-year (NE: in reference to the dismantling of the trap) but in reality they are very cautious”. “Until now The $200 million per day restriction by the NVC hasn’t even been lifted, neither communication A 7340 of the BCRA which requires banking dollars resulting from the sale of securities nor RG 959 of the CNV which prevents the purchase of foreign currency with collateral. Furthermore, last week the Central Bank made a sharp cut in deposit rates, giving the impression that the main priority in terms of monetary policy is to advance the liquefaction of equities and that the release of checks can wait […] It is difficult for us to see exchange rate unification happening in the second quarter of the year unless there is external financing.”
Economist Camilo Tiscornia, of the consultancy firm C&T Economic Advisors, explains that the positive result of this week’s financial tender allowed him to obtain pesos and with this he will purchase dollars from the Central Bank to pay the debt service. “This is partly explained by the fact that stocks persist, companies cannot buy foreign currency in cash without losing access to the single market and with the bonds offered by Finance at least they earn interest.”
The market chooses to believe as well as knowing whether in recent months it will be a chip that they have played and won almost 20% in dollars, or whether this time it will be different like the book by Carmen Reinhart and Ken Roggoff.
Source: Clarin
