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Luis Caputo said that they will compensate for the lack of the Omnibus Law “by deepening the adjustment in the items already known” - Infobae
Source:
February 07, 2024
He maintained that the rule implied a smaller portion of the fiscal adjustment that he is carrying out. He said that between 0.7 and 0.8 points of GDP from the planned cut were affected, and that they will be reached even without the law.
The Minister of Economy spoke with the LN signal
The Minister of Economy, Luis Caputo , minimized the impact that the return to zero of the Omnibus Law will have because he argued that the fiscal objectives of his administration did not depend on it. The official maintained that the original version of the bill “Bases and Starting Points for the Freedom of Argentines” implied between 0.7 and 0.8 points of GDP in terms of fiscal adjustment, of a total of 5 points that will be cut this year. And he stressed that, in any case, the fiscal package had already been eliminated to allow for better negotiation in Congress.
“The particular non-approval of the law yesterday does not affect in the least our economic program, our commitment to stabilizing fiscal accounts,” he said in statements to LN+.
“In fact I had withdrawn the fiscal package from the law. But in putting together that package, most of the adjustment of fiscal accounts was outside the Law. 75% of what we had planned was not included in the project,” he commented.
“It was what I said at the conference regarding the IMF. I said ' I am much more interested as an Argentine than as a minister .' As a minister, I don't have a life in that law because there is very little that we have put there that impacts our fiscal numbers.' They also asked me that if the law did not pass it would imply a greater adjustment, and I also said yes, which is obvious,” he insisted.
“We have already replaced part of what we had originally put in the law. Don't forget that the Fuel Tax has already been updated, which replaces the withholding part. There is 0.2 less deficit just because of that,” the official added.
“So what we are different from what was in the Law in the beginning is 0.7 or 0.8 [of the GDP],” Caputo minimized.
“Like how are we dealing with it and how are we going to deal with it? Well, simply deepening the adjustment in the already known items ”, she stated.
This morning doubts about the ability of Javier Milei 's government to obtain consensus for its agenda in Congress have a notable impact on the market with Argentine stocks and bonds falling sharply . In that context, Caputo was very emphatic that the course is not altered.
Without sufficient consensus, the Omnibus Law returned to committee (Gustavo Gavotti)
“We may not be politicians but we are not stupid either. We know that we are fighting against a handful of legislators, the caste, who do not want change in Argentina. “We knew there was a possibility of this happening,” he said.
In fact, the official stated that they are already achieving better fiscal numbers than expected.
“January, which is a more financially sensitive month due to the payment of interest on the debt, we are already in financial balance. Lawless. We are not improvised, that is why I withdrew the fiscal package from the Law,” he commented.
“The law is something else. It is not for us, it is for the Argentines. It is to deregulate, to remove the State's foot from people's heads, to eliminate kiosks. Whether it happened yesterday or in a month or two, it is not a big problem,” he said.
“Inflation is already falling, most economists predicted December 30%, January 30% and February 20 percent. Well, December came 25%, January 20% and February below 20 percent ,” stated the Minister of Economy.
“It is coming in significantly below what was expected, very high but below. The most important thing to rescue is the signal that the fiscal anchor is working. It is already bearing fruit. That is very important for us because it checks that we are going on the right path and makes us more optimistic that we are probably going to have a much calmer second semester. We must not lose our way, we must understand that we are in rehabilitation, we are a patient addicted to deficit but we are in recovery. It is already working, and that is a peace of mind,” he argued.
Source:
February 07, 2024
He maintained that the rule implied a smaller portion of the fiscal adjustment that he is carrying out. He said that between 0.7 and 0.8 points of GDP from the planned cut were affected, and that they will be reached even without the law.
Caputo le restó importancia al impacto fiscal de la Ley Ómnibus
El Ministro de Economía habló con la señal LN+
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The Minister of Economy spoke with the LN signal
The Minister of Economy, Luis Caputo , minimized the impact that the return to zero of the Omnibus Law will have because he argued that the fiscal objectives of his administration did not depend on it. The official maintained that the original version of the bill “Bases and Starting Points for the Freedom of Argentines” implied between 0.7 and 0.8 points of GDP in terms of fiscal adjustment, of a total of 5 points that will be cut this year. And he stressed that, in any case, the fiscal package had already been eliminated to allow for better negotiation in Congress.
“The particular non-approval of the law yesterday does not affect in the least our economic program, our commitment to stabilizing fiscal accounts,” he said in statements to LN+.
“In fact I had withdrawn the fiscal package from the law. But in putting together that package, most of the adjustment of fiscal accounts was outside the Law. 75% of what we had planned was not included in the project,” he commented.
“It was what I said at the conference regarding the IMF. I said ' I am much more interested as an Argentine than as a minister .' As a minister, I don't have a life in that law because there is very little that we have put there that impacts our fiscal numbers.' They also asked me that if the law did not pass it would imply a greater adjustment, and I also said yes, which is obvious,” he insisted.
“We have already replaced part of what we had originally put in the law. Don't forget that the Fuel Tax has already been updated, which replaces the withholding part. There is 0.2 less deficit just because of that,” the official added.
“So what we are different from what was in the Law in the beginning is 0.7 or 0.8 [of the GDP],” Caputo minimized.
“Like how are we dealing with it and how are we going to deal with it? Well, simply deepening the adjustment in the already known items ”, she stated.
This morning doubts about the ability of Javier Milei 's government to obtain consensus for its agenda in Congress have a notable impact on the market with Argentine stocks and bonds falling sharply . In that context, Caputo was very emphatic that the course is not altered.
Without sufficient consensus, the Omnibus Law returned to committee (Gustavo Gavotti)
“We may not be politicians but we are not stupid either. We know that we are fighting against a handful of legislators, the caste, who do not want change in Argentina. “We knew there was a possibility of this happening,” he said.
In fact, the official stated that they are already achieving better fiscal numbers than expected.
“January, which is a more financially sensitive month due to the payment of interest on the debt, we are already in financial balance. Lawless. We are not improvised, that is why I withdrew the fiscal package from the Law,” he commented.
“The law is something else. It is not for us, it is for the Argentines. It is to deregulate, to remove the State's foot from people's heads, to eliminate kiosks. Whether it happened yesterday or in a month or two, it is not a big problem,” he said.
January inflation
Caputo also made room to anticipate to some extent the January inflation number, which will be officially published on February 14.“Inflation is already falling, most economists predicted December 30%, January 30% and February 20 percent. Well, December came 25%, January 20% and February below 20 percent ,” stated the Minister of Economy.
“It is coming in significantly below what was expected, very high but below. The most important thing to rescue is the signal that the fiscal anchor is working. It is already bearing fruit. That is very important for us because it checks that we are going on the right path and makes us more optimistic that we are probably going to have a much calmer second semester. We must not lose our way, we must understand that we are in rehabilitation, we are a patient addicted to deficit but we are in recovery. It is already working, and that is a peace of mind,” he argued.
