Martín Guzmán resigns: the academic who arrived from Colombia with the recipe to renegotiate the debt and part criticized by the harsh Kirchnerism

The office that Martín Guzmán had in Columbia University’s Uris Hall contains more than twenty books. Most were written by his mentor, Joseph Stiglitz (Nobel Prize in Economics). Others are co-authors of both. If the Argentine has to choose one to give to his visitors, he takes a hardcover one, with the title ‘Too little too late’. In Spanish it means something like “too little, too late”. It is available in English only and is a collection of technical articles. But it gives a good idea of ​​the road map Guzmán wanted to follow.

The book’s contention is that countries that fail to meet their debt burdens in the bud impose “huge” costs on their societies and depress the conditions for economic recovery. It is estimated that since 1970 more than half of the restructuring and re-profiling experiments with the private sector have been followed by another restructuring or insolvency within five years.

The now former Minister of Economy of Alberto F. and his co-authors proposed in the book contractual reforms and negotiations through international associations and organizations (such as the International Capital Markets Association and the United Nations), to clear the horizon and prevent economies from sinking into recession and legal conflicts. First fact to be taken into consideration with the appointment of Guzmán: Alberto Fernández does not want what happened to Cristina in 2011-2015 to happen to the economy.

The Fund was “looking forward” to working with the new business team. Guzmán understood that the country’s central problem is debt. And that if he doesn’t fix it, there will be no way to put in place a macroeconomic program that will allow him to recover. “Argentina needs a much more elaborate and complex negotiation than that of other countries”.

Guzmán negotiated a meaningful haircut with private creditors, but a year and a half later the country’s risk is the same as before the swap. He has negotiated with the IMF but the Fund itself does not believe in what he has signed. Meanwhile, the gap with the dollar has widened to 100% and inflation aims to close the year at least 80%.

The pandemic got in the way, the collapse and rebound of activity and a horizon full of doubts, heightened by the fracture exposed in the Frente de Todos.

That fracture limited the room for maneuver, because Christianity It prevented him from advancing the cuts in energy subsidies and even denied him the change of officials who were in his sphere of responsibility.

A denial of autonomy that ended up expelling him from the government.