Works, funds and fiscal deficit, Silvina Batakis’ problems with the governors in a shorter meeting

For the second consecutive day, the government tried to resume its relations with the governors and expand political support for Economy Minister Silvina Batakis. The official received a small group to review the situation of the public works, funds and needs of the provinces in the midst of major tax restrictions. But the photo was much more concise than Monday’s: it was there fewer leaders and the meeting was shorter.

The one-hour summit on Tuesday was held in the office of the head of the Treasury, accompanied by the chief of staff, Juan Manzur. From Economics highlighted that visitors “have expressed their support for the economic guidelines” government, following the announcement last week of a spending control regime, the freezing of public employment and the centralization of surpluses in a single account.

The delegation was made up of Sergio Uñac (San Juan), Gustavo Bordet (Between the rivers) and Ricardo Quintela (La Rioja), who expressed their concerns around an octagonal table, smaller than the oval table in the Scalabrini Órtiz room, where five governors were received on Monday. Among them, Axel Kicillof of Buenos Aires. The Province had been one of those that he had warned about the “serious” situation and asked for urgent measures.

There are currently no new meetings with the governors. We will see. “They come what they can, it was never said that everyone would come, now the meetings with the mayors will continue”, explain the official sources.

Although Alberto Fernández promised on Monday that the adjustment of the accounts “will not come at the expense of the interruption of public works”, the provincial leaders fear that the arrival of funds and the execution of the works will be affected. The maneuver modified by decree in fact provides for an increase in capital expenditure by 74% in 2022, below the inflation projections of between 80 and 90%. And the execution in May shows an advance of only 26%.

Batakis sees a complex scenario in the coming months, as Clarín reported over the weekend, characterized by strong demand for dollars to cover energy imports and a decline in foreign exchange inflows due to grain retention by soybean producers. All of this feeds the exchange rate gap and makes it difficult for the Central Bank to accumulate reserves. For this reason, the Executive tries to show political support for the minister’s plan.

A week after the announcements, the social movements have already mobilized, the campaigns and governors are on hold. Basically they claim the distribution of the resources of the federal partnership, the management of social plans, inflation and the lack of diesel. These were the issues that united the league of governors before the resignation of Martín Guzmán, as a sign of estrangement from the leadership of Alberto Fernández.

Batakis’ agenda will continue this Wednesday with his first cabinet meeting and the publication of the June fiscal deficit. The Public Bureau of Congress (OPC) reported that it reached 1.9% of GDP in the first six months, a 92% jump year-on-year in real terms due to the sustained increase in spending and the lower growth of GDP. collection.