President Alberto Fernández's government presented its first draft budget to Congress on Tuesday evening, predicting that Argentina would see economic growth of 5.5 percent next year, with a primary fiscal deficit of 4.5 percent and annual inflation at 29 percent.
The proposal also predicts that the peso will weaken to 102.40 per US dollar in 2021. It currently stands at 79.36 pesos.
The government says its strategic priorities will be be the reactivation of production, generation of employment, strengthening of innovation capacities and the strengthening of education and health systems.
The government said the public health system would receive an increase in investment 49 percent greater than in 2019, provided by a projected investment of 0.5 percent of GDP. In education and connectivity, an 11-percent rise (on 2019's data, projected for 2021) was promised, equivalent to 1.3 percent of GDP. The budget also foresees a doubling in investment in productive infrastructure, at a rate of 2.2 percent of GDP.
For the first time, the bill also includes ring-fenced funds for the implementation of gender and diversity policies, with projecting funding to the tune of 6.2 billion pesos (about US$78 million at the current exchange rate).
Argentina’s economy has been in recession since 2018 and the International Monetary Fund estimates a 9.9 percent drop in GDP this year. Private estimates think it is likely to be closer to 12 percent.
Economy Minister Martín Guzmán, will present the Budget bill to the lower house Chamber of Deputies next week, expanding on the details in the proposal.