Tuesday, July 16, 2024

ARGENTINA | 28-06-2024 16:34

Monetary shift, Sturzenegger in – Milei talks up new stage for his government

President says PAIS Tax "could be repealed in August" and confirms that ex-Central Bank governor Federico Sturzenegger will be joining his Cabinet.

President Javier Milei has declared that “the zero deficit stage" of Argentina's government "is over,” highlighting that an imminent "change in monetary regime is coming.”

He also trailed that the PAIS levy (“For an Argentina of Inclusion and Solidarity") introduced by the preceding Alberto Fernández administration "could be repealed” as early as August.

"The zero defict stage is over, now the change of monetary regime is coming,” declared the head of state in a television interview following congressional approval of his 'Ley de Bases' reform package. 

He also confirmed that ex-governor of the Central Bank during the 2015-2019 Mauricio Macri administration, Federico Sturzenegger, “is joining the Cabinet next week" in a new ministerial post.


President Milei on:


Approval of 'Ley de Bases'

“Argentina has just triggered 800 structural reforms. In terms of economic freedom, we’ll be climbing 90 spots. Argentina begins to be more like countries such as Germany, France and Italy. It puts us in a position to quadruple our GDP per capita, which means reducing the number of poor and destitute people and improving quality of life."

Fiscal situation

“Up until May, the numbers were significant, despite the consistent forecasts that ‘it was only a month, and it would fall the next one.’ We have hope that figures in June, which has seasonality against it given the payment of the half-bonus, will give surprising numbers and that will leave us a very big margin to face interest payments in July. 

"Fiscal consolidation is ongoing. The zero deficit stage is over, and now we move on to the zero printing stage, the change of monetary regime. We have achieved a real 30-percent fall in public expenditure. That’s for ignoramuses who are always cheating people with consultancies. It’s not my fault that analysts do not understand and have plenty of reading to do."


“The economy found a floor and is bouncing back. In six months we avoided hyperinflation and made the biggest adjustment in the history of humanity. That’s why the achievement is huge. The fall was lower than could have been expected. The economy is moving. Some go first and others will come next. There is a basis for us to start a solid recovery."


“Real salaries are above November levels. We’re better than when we were inaugurated."

PAIS tax

“When the regulation of the law finishes and income starts coming, it will start. When everything’s working, and money’s rolling in, we’ll lower it. I guess that could be in August. We need to regulate the laws, but we also need to cash flow to be working."

Federico Sturzenegger

“He will be joining the government next week. Yesterday we worked together for three hours. We’re going to create a Ministry which takes care of State reform. We have 3,000 more reforms Sturzenegger will be in charge of."

Dollar and the exchange rate

“I’m not worried about the dollar value. It’s the politicians’ fault who made a lot of noise in the bonus market. Now comes a period when seasonally we lose foreign currency. It’s only natural. Besides, half-bonuses are paid and people tend to buy. We won’t devaluate, it would be outrageous. We’ll gain competitiveness by lowering taxes. The idea is to simplify the tax structure and to go from 170 taxes to 10. That’s why the 'Pacto de Mayo' is very important. We have plenty of reserves."

Private health insurance

“If private health insurance companies commit excesses again we’ll once again resort to [interverntion to ensure] defence of competition. They did it once and we did so, and if they do it again… that manoeuvre had political intent. The owner of one company has links to the man who lost the election. He aimed at attacking an age group, which is the core of our voters. What we discovered is there is a group of degenerates who don’t care about destroying the population to wield power. The previous government stole US$45 billion. They spent it on populism."


“Dollarisation will happen naturally. The peso won’t necessarily disappear. What is needed is to keep it from growing so there is no problem which leads to disinflation. Monetisation will happen with the presence of new currencies. The ratio between other currencies and the peso will be so big as to become neglectful. It’s a process that will occur over time."


“I’m not worried that [it’s above five percent for the month]. There is a downward trend. Yet believing that there is no saw is a huge conceptual mistake. What we have to look at it the core and wholesale inflations. There is a two-percent floor which is the [Central Bank’s] devaluation rate. In the middle there is a rebuilding of relative prices, which is not inflation."

Quarrel with Lula

“The truth is it’s a very small quarrel, of preteens. It’s the same mechanism as with [Colombia leader Gustavo] Petro and [Spanish Prime Minister Pedro] Sánchez. Lula actively meddled with our election campaign. The things I said are true. Wasn’t he incarcerated for corruption and isn’t he a communist? Are we so diseased with political correctness that we can’t tell the truth? Do the people who lied during the campaign and actively participated demand an apology because they were told the truth?”

Pope Francis

“I got it wrong with the Pope. His thought has to do with his Jesuit visión. And I don’t agree with some things" the pontiff says.



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