The Minister of Productive Development, Matias Kulfasconsidered this Sunday that understanding with the International Monetary Fund (IMF) “It is a good agreement, a necessary step for Argentina to move forward in normalizing its macroeconomic situation and it will also dispel the possibility of a default that would have very negative consequences for the country.”
In statements to Rivadavia and Del Plata radio stations, the minister stated: “the problems we have, which are not few, would worsen. A default scenario would imply the loss of financing for imports, the risk that dollar prices would skyrocket which means more inflation, more poverty. All this is dissipated”.
Kulfas highlighted three points of the agreement with the IMF. “The first is that it implies financial relief, allows to postpone payments, and that Argentina in the next three or four years has all the efforts to grow and reduce poverty. The second is that does not have any of the neoliberal reforms to which the IMF has accustomed us. No labor reform, which removes rights from workers, or pension reform. And third, it arises reduce the fiscal deficit not through spending cuts or adjustments, but through growth“.
Later, the minister explained that “the expectation is that the opposition accompanies because we have had an absolutely broad and democratic attitude, we did not make an agreement behind the scenes, but rather the whole negotiation was explained in successive steps, and now it is being taken to the Congress. It is clear that it is an agreement that serves Argentina, it adds to it. We appeal, as on many occasions, to dialogue. We hope that the interest of the country prevails, because this agreement is not for a government, it is for Argentina and it will to have implications for several years.
Three key points of the agreement with the IMF according to Kulfas
– Implies financial relief
– It does not have any of the typical neoliberal reforms of the organism
– Reduction of the fiscal deficit not through spending cuts or adjustments, but through growth
Kulfas highlighted that “this is the best possible agreement. May all the compañeros and compañeras remain calm, may the Argentine people remain calm. We are not going to adjust, on the contrary. let’s grow and, as a result of that growth, just as Néstor Kirchner proposed, we are going to achieve the long-awaited economic recovery, reduce the fiscal deficit, which is also something important, I do not think it is good to always live in deficit, we must achieve a balance fiscal, but it must be done with growth, not with adjustment”.
In relation to employment, the person in charge of the productive portfolio explained that “every week I visit factories, and there I talk to workers who tell me that they were unemployed and now have a job in that factory, in that home the situation changed drastically. In that household had no income, or had a very precarious income and now there is a wage income with labor rights such as in a factory. On the other hand, there are people who came from a social plan, which we know is not a solution, and today we are seeing that he is getting a job. That is the first way to bring dignity, recovery and that it effectively reaches the Argentines.”
Referring to inflation, Kulfas noted that “unfortunately, Inflation has multiplied in the world, in recent months as a result of the rise in international prices of commodities. We are working with different schemes, trusts, with forms of intervention in the markets, but I insist that it is an extremely adverse scenario.”
On future salary negotiations, the minister stated that “last year income beat inflation by very little, this year the bet is that this gain will be much more significant so that there is also more reactivation and more social inclusion on the income side”.
Later, he pointed out that “the parity guidelines around 40% are the starting point, but in no way are we going to be passively looking for the salary to be below inflation, quite the opposite. We are going to work very actively so that that does not happen. We are totally convinced that this year all the conditions are in place for wages to be above inflation. We confirm that the industrial sector has margins so that with greater growth it can reduce what it earns per unit of product and earn by greater volume, and distribute this growth positively in favor of the workers”.
