Buenos Aires Times

argentina EXCLUSIVE INTERVIEW

De Narváez: 'Neither Macri nor Cristina should run for the presidency'

Some three years after leaving his seat in the lower house behind, businessman and politician Francisco de Narváez says he has solutions for the crisis facing Argentina – and he’s ready to help put the nation back on track.

Saturday 22 December, 2018
Businessman and politician Francisco de Narváez, pictured at the offices of Editorial Perfil, during an interview with Agustino Fontevecchia.
Businessman and politician Francisco de Narváez, pictured at the offices of Editorial Perfil, during an interview with Agustino Fontevecchia. Foto:PERFIL/ PABLO CUARTEROLO

After quitting his seat in Argentina’s Chamber of Deputies in 2015, Francisco de Narváez has remained on the sidelines, in something of a self-imposed exile. Today aged 65, the Argentine-Colombian has gone through many phases, from budding businessman to gubernational candidate in the all-important Buenos Aires Province.

Yet the moment that has marked de Narváez’s career the most, particularly as a politician, is undoubtedly the 2009 midterm elections, in which he defeated Néstor Kirchner in the race for a seat in the lower house, running in coalition with Mauricio Macri and Peronist Felipe Solá. While the narrow victory didn’t mark the beginning of the end of Kirchnerismo, it was nonetheless a momentous victory in the nation’s most-populous province, one that historically been viewed as the bastion of Kirchnerite support.

De Narváez has always been a divisive character. A wealthy businessman, affiliated with the Peronist party, traditionally associated with the working classes. A tattooed man that wears suits. The owner of the América TV broadcast channel and El Cronista, an economic daily newspaper. Yet, he has always spoken his mind and rolled up his sleeves. He is unafraid of getting dirty.

Today, the businessman breaks his recent silence with the Times to propose a set of solutions that he believes would lead the country out of the current crisis, which he says is much more than just economic.

In 2015 de Narváez unsuccessfully sought to set up a coalition between Macri and Renewal Front Leader Sergio Massa, in order to beat Daniel Scioli, former president Cristina Fernández de Kirchner’s handpicked candidate for the presidency. Now, he is once again looking to construct a political space, one that goes beyond polarisation, he tells the Times.

What moved you today to express your thoughts of the current situation?

I never left politics. I [have] remained silent for a couple of years. It’s time to talk. I’m seriously worried and preoccupied by what’s going on in Argentina. We are in a crisis, it’s already with us. Inflation is destroying salaries by the hours. It’s a crisis. The issue is how we cope with it.

Three years into Mauricio Macri’s government, inflation is at a similar level to what it was when he took office. The peso is substantially devalued, economic activity has stalled, and we have some US$100 billion in foreign debt. What is your take?

After three years, which is a good [amount of] time to show fundamental results, president Macri’s economic policies have disappointed not only Argentines but the world. The economy is declining at a rate of 10 percent. Inflation is above 60 percent with [high] interest rates. The IMF agreement, the second one, it’s a bluff. It’s impossible to comply with and everybody knows that. The world knows that. By 2020 the question is when are you going to default. We have an electoral year that is very crucial for Argentines and the rest of the world.

We could talk about the number of people living under the line of poverty but I don’t like to talk about percentages, I like to talk about families. It’s a big crack, to have hunger in Argentina, the supermarket of the world. Fifty percent of our children don’t finish high school and the 50 percent that do, half of them think they wasted their time. Those are the signs [that are] more relevant than the economy. If you go to a public hospital you won’t receive the proper care, if you go to a police station sometimes you feel more scared than in your house, justice doesn’t look [to be] independent, drug-trafficking has taken control of whole cities.

The most significant sign is that we have lost our inspiration for the future. People think that tomorrow is going to be worse than today. The have good intentions [but] Macri hasn’t fulfilled his promises as a candidate.

While the economy under president Cristina Fernández de Kirchner appeared to be closing in on itself, Macri’s economic plan was based on opening our markets. Regardless, inflation remains a major problem, how would you tackle it today?

Looking backwards it’s easier to understand what happened. Basically Macri didn’t change much what he inherited from Kirchner. He only supplied money to the financial sector. The idea was borrow 40 billion [dollars] per year, get the money and that will give us money to maintain populism on a more educated way.

The world has changed. China has slowed its growth. The US has grown much faster than what it was supposed to. Both things have affected Argentina.

I don’t see an open economy, it’s closed. You can’t borrow money, Argentina is being penalised because of not fulfilling its debt [obligations], we have corruption, credit is forbidden.

If you see the trade balance, imports have slowed and exports increased because of the devaluation. They devalued 120 percent and prices increased a lot, the effect of devaluation has been dramatic, especially on salaries, which are among the lowest increases in South America in dollars and unfairly distributed. Macri hasn’t changed that much. The structural change that has to be done – it has not been done.

And the fiscal deficit?

Not only that. We have to cut state expenditure by a third or even half. That’s what we can pay for. People in the social [welfare] system that have never provided money to the system get the same benefits as those who contributed. It’s unfair. You can’t pay teachers that don’t teach, doctors that don’t cure, policeman that don’t work.

In the last 16 years, beginning in 2003, I haven’t seen many changes. The leadership of the country should say what they want and propose things.

I have a proposition. Macri and Cristina shouldn’t run for the presidency. If we continue discussing whether it’s Macri or Kirchner, the results will be the same. Argentina is going to suffer. We need three presidential terms without re-election. Presidents who commit themselves to a common agenda. That’s what other countries did, they didn’t change overnight.

We have to speak the truth, [this is] no time to lie. If we reach an agreement on education, healthcare and other issues, support agro-business, energy, fishing, tourism, construction, we have a lot of advantages compared to other countries.

I’d like to propose the national, provincial, municipal elections are held on different days. If not, it’s the same system. Why hasn’t Macri changed the voting system, which he questioned.? We are going to vote next year with the same ballots.

My interpretation of the plan was that we borrow to finance so we can stop printing to lower inflation. Then we reduce the size of the state gradually and, in parallel, we generate productivity to invest. But what happened is that investment took a long time. Do you think there’s anything that could have been done in the short term to generate productivity?

I agree with your description of the master plan. They forgot that there is politics in between.

It’s a naïve approach to just say what you plan on doing, you actually have to make it happen. Between what you express and what you do there’s a big gap. Ideas are great but you are not making it happen. They lost the opportunity and people are fed up. Governments can make a lot of mistakes but when you lose trust you’re gone and it’s hard to regain it.

There’s no doubting the potential of Argentina. We need an agreement between all sectors – unions, private sectors, churches, NGOs, the political sector. An agreement on five main issues to pursue in the next 10 years. Let’s bring Argentina back to be a leading country in public education. We are hitting 10 percent unemployment.

If the world receives a signal from Argentina that there’s an agreement, and that Cristina and Macri are not running, an open and transparent election will deliver a candidate that commits to that agenda, only running for a period. If we do what we said, we’ll regain trust and inflation will drop.

I would also like to propose to use any type of resources regarding drug-trafficking, even the military forces. The dictatorship happened 40 years ago, let’s use the resources of the country properly. We need any and all types of resources.

January 2016: the PRO party generates a coalition with the Radical Civic Union (UCR). They win and are looking to govern the nation and say no to a coalition with Sergio Massa. That allowed Macri to win the 2017 midterm elections, but limited his capacity to pass legislation, meaning his reform agenda remains delayed. The agreement you propose, do you believe it is possible with PRO or without them?

Political parties are dead. It’s old-fashioned. We are now talking about persons and ideas. It has to be lead by persons that share a common view of Argentina, whichever party. It would take us nowhere discussing parties. I’m affiliated to Peronism but it’s outdated. My generation is 65 years old and we should bring other people to the table.

There’s a big difference between a political project and an electoral one. The Kirchners had a political project. Cristina disappointed me and that’s my limit. Macri didn’t fulfil his promises. Kirchner had a vision that meant 20 years in power: One term for Néstor, two for Cristina, and one more for Néstor. They were not in office to win elections, they were in office to exercise power.

Macri and his electoral team are good at elections but lousy at executing ideas. We can’t blame our failure on the US economy heating up and China slowing down, that’s not being a leader.

Let’s change the equation and create a programme that’s feasible for Argentina. Nobody wants to keep financing this joke. We have to create investment to create real jobs. We are not giving people the tools to become entrepreneurs. Eighty percent of jobs are being created by small- and medium-sized companies but we are destroying them with these interest rates.

If Macri really wants to be part of history he can call for a national agreement. Kirchner should be part of it as well. The rest of the leaders should also have an opinion.

Are you a candidate?

No.

Who would you propose? I hear a speech of political agreement a lot. Duhalde and Alfonsín proposed Lavagna. He seems to be the candidate for them. Is Lavagna yours too?

If we start with names we get nowhere. Why don’t we start by good ideas. Do we agree that the size of the state is unaffordable? If the answer is yes we are on one side of the table. Do we have to recover our free, high-quality education system? If people agree then we begin to build consensus. Then you can start a debate. I have a lot of respect for Lavagna, but I would hurt him by saying if I support him or not. The process must be different if we want to have different results. In Argentina we have to stop dreaming and talk about reality.

Your proposition requires social and electoral consensus. Yet those close to Cristina most probably would not participate, and we know Macri isn’t fond of an alliance with the Peronists. Is this actually possible or just a pipe-dream?

It’s totally possible. I don’t read polls, but I listen to people. What I hear the most is that many dislike Cristina and they are also disappointed by Macri, so choosing what is best for the country is which one of the two causes the lesser harm. I want to change that equation.

What we’re talking about is a game-changer: putting together a coalition thinking about the future without constantly questioning the past. Is the private sector willing to sacrifice five years of profits to improve the country? The answer should be yes, as they are in it for more than five years. Each sector has to commit to this.

Our Judiciary has always been friendly with those in power, as they were initially with the Kirchners, whom they now investigate ferociously. With the so-called ‘notebooks’ corruption case, we have the first investigation that looks at both the previous government and the business sector.

It’s good that it happened and it’s definitely a breakthrough. [La Nación journalist] Diego Cabot did great work. Either you are corrupt or you are not, there are no grey areas. People that form part of the system who pay bribes in order to win a bid for a public works project are corrupt, I see no excuse.

In the past, Judge Bonadio threw out accusations against the Kirchners, only to later publicly claim he has a personal issue with Cristina. Does that discredit him in such an important case or do the ends justify the means?

I have no evidence that he has a personal issue with the Kirchners. He’s been very courageous to start this process, calling some very powerful people to testify. He is very much alone, he doesn’t have much support. I was a member of Congress when [AMIA Special Prosecutor Alberto] Nisman was going to testify, before he was killed.

I went to the march protesting his death, but I haven’t seen a march for Bonadio. We should support Bonadio. In Brasil it was a long case with Lava Jato [Operation Car Wash], I hope in Argentina this case becomes a factor of change as happened in Brazil. We have to delete corruption in Argentina and this is a step toward that.

Paolo Rocca, owner and CEO of Techint, was supported by the Argentine Business Association days after his righthand, Luis Betnaza, man admitted to paying bribes, with President Macri in the audience. A few days later, Macri visited Rocca in the Vaca Muerta shale formation. What explains the government’s implicit support and the Judiciary’s lax treatment of Techint?

That called out to me as well. The best way to hide an elephant is in a pack of elephants, I would say.

The Conurbano has the highest concentration of poverty and crime, the weakest educational system, and the biggest debt. What steps should be taken there?

It’s four-and-a-half million kids. Public schools have many more social reasons than educational ones there. They organise the way people live.

For some of us we can enjoy vacations, for others these are difficult times because schools are closed. Schools are places where children are left for a few hours, are fed and have some kind of education.

If the discussion is of teachers’ income or the number of school days we won’t solve the problem. We need to have full days of schools, not half-days, to invest a lot in new schools and work with teachers. Many teachers have retired, let’s bring them back and get rid of the ones that just protest.

The problem with the Conurbano is that it’s growing toward Obelisco. If we work around highway six and the second and third cordon, creating industrial parks, hospitals, schools and entertainment centres, instead of compressing toward the Obelisco, then people can get jobs right there.

Who pays for it and how?

If we reduce the size of the state by a third and we commit to an austere administration, Argentina has a lot of potential, to produce and collect funds through taxes. Money won’t stop flowing into Argentina if we get into a positive trend. International funding is willing to help us, yet our cashflow issue prohibits it. We can’t help ourselves, why would they help us? We need to fix our strategy and eliminate the deficit. We have a future, I have no doubt.

Are you sure you won’t be a candidate?

No.

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