Claudio Loser: “Massa sells very well what it promises”

Despite having retired from the IMF as director of the Western Hemisphere, Claudio Loser, born in Mendoza and permanently resident in Washington, is a source of consultation for investors, economists and governments. Here is a summary of the interview with Clarione after Sergio Massa’s tour in the United States.

-Massa got the desired photo with the head of the Treasury, Janet Yellen. But then the Treasury made it known that Yellen had encouraged him to rebuild credibility, how should it be interpreted?

Everyone agrees that there is a serious problem of credibility and lack of trust. Economic policy is not just numerical, but coherent. But Massa was very well received in the United States. I think he’s a very good seller of what he at least promises to do. And this is not a trivial matter. The Fund likes numbers, but it also looks at the support that policies can have, and Massa has insisted on having that support. And specifically with that of Cristina Kirchner. This is what Kristalina Georgieva also saved in her communications.

-How does Washington see the high inflation suffered by Argentina?

– With concern and in three dimensions. On the one hand due to the level of the fiscal deficit where there is some improvement and this implies slightly lower emissions. Also for interest rates. It is important that they are positive or on par with inflation and the Central Bank has done something to increase them. It prevents part of the pesos from raising prices. And it follows the evolution of the exchange rate.

-Are you afraid of a devaluation?

-Massa said he does not want to devalue in this context of high inflation.

-Georgieva plays the role if the plan with Argentina fails?

-It would do a lot of damage because Argentina is the main customer, but there are other countries in difficulty in the middle of a world of high fragility and volatility. There are the cases of Egypt and Sri Lanka.

-The World Bank has said that rising international rates will lead to a global recession …

-The World Bank protects itself in its forecasts. Growth rates are likely to be close to zero in the US and Europe are further complicated by the Russian invasion of Ukraine. We must consider the situation in China, complicated by the Covid epidemics and the real estate bubble that is starting to burst due to paid and never built houses. But in no way will it be a recession like the one caused by Covid in 2020 or the financial crisis of 2008. I am cautiously optimistic. And in the Argentine case, despite having lost the opportunity with the war in Ukraine as a potential energy supplier, the conflict has not punished it so much for the increase in the prices of raw materials.