Government optimistic over budget deal
Interior Minister Rogelio Frigerio expressed confidence Thursday that the government would win the broad support of the nation’s provincial governors over the 2019 Budget, predicting a deal could be sealed as early as next week.
Government officials were finalising a draft document yesterday, with a meeting scheduled for Tuesday with President Mauricio Macri.
“There were some doubts about some numbers,” Frigerio told reporters Thursday. “We are going to evacuate them bilaterally speaking with them in the coming days.”
Speaking yesterday, the governors of Salta, Juan Manuel Urtubey, and Chubut, Mariano Arcioni, called on “everyone to work responsibly” to approve the budget for the coming year.
On Monday, the president described the country’s current economic situation as “an emergency” and announced the temporary restoration of a series of export duties.
Argentina is one of the world’s biggest exporters of corn and soy oil. Addressing rich agricultural exporters who will face export taxes, he said: “We know its a bad tax, but I ask you to undertstand that it’s an emergency.”
The Mauricio Macri administration remains optimistic that the provincial governments will agree a deal as a means of sending a strong message to international markets about Argentina’s political and financial stability. The vote on the Budget in the Lower House is scheduled for October 24 while Senators should vote on it on November 13.
“We’re close”, government sources told Clarín this week. “We will not touch spending any more and with the measures we have announced, we should get there.”
Despite the turbulence stemming from the huge slump in the value of the peso and strong calls from the opposition, the government does not intend to restore the $26-billion-peso (US$675 million) Soy Fund, which affects the finances of the provinces and particularly municipalities.
Peronist mayors on Wednesday demanded the restitution of the fund. However, the government is sticking to its offer of lines of credit through the ANSES welfare bureau.
The national government also intends to transfer $43 billion pesos (US$ 1.1 billion) in public transport subsidy funding to provincial governments and another $14.5 billion (US$375 million) in electricity subsidy funding, meaning provincial governments can decide how to apply subsidies, if at all, in those sectors.
MASSA RETURNS
After several months in the shadows, dissident Peronist leader Sergio Massa returned to the public eye on Tuesday to demand that President Mauricio Macri establish a broad political working group to address the country’s economic problems.
Massa met with provincial leaders, legislators and Peronist union leaders at the Federal Investment Council (CFI). Peronist mayors and Peronist Majority Leader in the Senate, Miguel Angel Pichetto, also attended.
“The first thing the Government should do is call governors to a political working group to see how we can care for regional economies and achieve fairness in the taxation system”, he told reporters. “Otherwise, it is workers, producers and investors who end up paying”.
On the topic of the government’s deal with the International Monetary Fund (IMF), Massa said: “Approaching the Fund was a grave mistake. Now, with this reality, we must work together. But further down the line, we need to resolve it”.
Massa has been keeping a low profile after his front’s dismal mid-term election results in October last year. At the top of the senatorial ticket for his alliance, he secured just 11-percent of the vote in the key battleground of Buenos Aires province.