After the meeting of Council of Ministers special convened by President Luis Lacalle Pou to finish define the priorities of the next Accountability Law which will be presented to Parliament this Thursday, June 30, the Minister of Economy and Finance Azucena Arbeleche spoke at a press conference about the general guidelines.
The Ministry of Economy and Finance (MEF) had projected in February of this year a growth of the economy of 3.8% for this year, however, This Monday, Minister Arbeleche announced that this figure will rise to 4.8% (1 more point). This data is six tenths above the 4.2% projected by economic analysts in the latest Survey of Economic Expectations of the Central Bank. However, other analysts use a figure closer to 5%.
Also, the government expects the economic expansion planned for 2022 to generate 40,000 jobs.
“This greater economic activity is going to happen with the creation of jobs, around 40,000 for this year,” Arbeleche declared.
The hierarch highlighted the good growth that the activity had during the first quarter with a year-on-year expansion of 8.3%, while highlighting the good performance of leading indicators such as exports, slaughter and harvest of summer crops during the second quarter (April-June).
Arbeleche rescued the “very good performance” that the Uruguayan economy had during 2021 with a growth of 4.4%, a figure that exceeded the expectations of different private analysts, he said, and also of the government itself. “There were even those who called these projections optimistic,” the minister recalled. The head of the economic team also commented on the drop of 1 point that poverty had last year.
Poverty in Uruguay closed 2021 with a rate of 10.6% and improved 1 point compared to the first year of the pandemic (2020). Thus, around 35 thousand people left their poor condition last year. In 2019, before the pandemic, the poverty rate in Uruguay had been estimated at 8.8% of the population. In 2020, the pandemic had left a balance of 100 thousand more poor people in the country, a figure that was partially reversed last year.
On the other hand, the hierarch assured that the “fiscal goals remain unchanged” according to what was projected in the previous Rendering of Accounts. The government hopes to bring the red of public accounts to 2.5% of GDP by the end of 2024.
Regarding the president’s announcement to reduce the IRPF and IASS burden if the economy grows as projected this year, Arbeleche indicated that this commitment is maintained but that it will not be part of the Accountability Report that will enter Parliament this week. The GDP growth data for 2022 will be known in mid-March 2023.
Regarding the Accountability project, the minister avoided confirming the incremental spending data but confirmed that the priorities will be educational transformation, security and salary recovery for public officials.
“In the Accountability that we are discussing today, we consolidate the educational transformation that the country has been carrying out and that is now going to be strengthened, and we consolidate the protection of our citizens from the Ministry of the Interior. We also talk about salary recovery in public officials, which is beginning to be observed in this Rendering of Accounts. This was a commitment of this government”, said Arbeleche.
