New Economy Minister Sergio Massa is preparing a series of measures to solve one of Argentina’s main problems: a chronic shortage of dollars that has caused the American currency to rise in parallel exchange markets.
Massa, who was appointed by President Alberto Fernández last week to head an expanded and empowered economy ministry, is expected to unveil incentives for exporters as well as policies to attract more foreign investment and capture additional tourism revenue, according to people with knowledge. of the regime.
On Monday, he called on Raul Rigo, who resigned just a month ago along with former economy minister Martin Guzman, to return as treasury secretary. Lisandro Cleri, the head of the fund management arm of the country’s public pension fund, will serve as vice president of the central bank. The new minister also appointed former policymaker Daniel Marx to the ministry’s debt markets committee.
Massa will continue to announce squad members during Monday and Tuesday, and said he will begin announcing policies at a press conference on Wednesday after his swearing-in.
Central Bank President Miguel Pesce is expected to continue in his role.
The plan is being finalized with a renewed sense of urgency. The gap between official and parallel exchange rates reached the highest level since the hyperinflation era of the 1989-1990s last month before narrowing in recent days. Foreign exchange reserves are very thin as Argentines, fearing an escalation in the crisis that claimed the lives of two economy ministers last month, continue to withdraw dollars from their accounts.
Among the measures being considered are some aimed at improving conditions that would encourage farmers to sell their crops, which are the main source of hard currency for the country, the sources said. This could include some kind of tax incentives for farmers, said one of the people, or the possibility that they could access a lower exchange rate than the official rate, said another. No official decision has yet been made.
Massa’s team is also studying measures to ensure that foreign currency brought in by tourists enters the formal financial sector.
A Massa spokesperson declined to comment.
Search for support
In a bid to bolster the government’s credibility abroad, Massa will travel to Washington, New York, Paris and Qatar the third week of August for meetings with international investors and creditors, one of the officials said. people. IMF staff met last week with Massa’s predecessor, Silvina Batakis, who only lasted three weeks in office.
At some point this week, Massa plans to meet powerful Vice President Cristina Fernández de Kirchner, according to one of the people with knowledge of the matter.
The former economy minister had no such meeting with Kirchner, exposing the nervousness that stems from a rift within the ruling coalition over economic strategy that has eroded the government’s credibility. Investors are looking to see if Massa’s political influence allows him to implement a more conventional economic framework that the ruling coalition has resisted so far, including spending cuts, devaluation and less money printing.
by Bloomberg / Patrick Gillespie & Ignacio Olivera Doll
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