The president of the Central Bank (BCRA), Miguel Pesceassured this Sunday that “Argentina is showing signs of improvement and reactivation”after the signing of the agreement with the IMF, although he recognized the effect of increases in international prices on the import of energy and other inputs for production.
In this sense, Pesce maintained that Argentina had come “of two critical years (2018 and 2019), with a lot of inflation, then the pandemic and the war appeared” that complicated the scenario in terms of price stability and growth of the public debt in pesos, although he pondered that “last year, the product grew more than ten percent” and that “This year it is giving a growth of nine percent.”
“Argentina has strong potential in the future. It is a country rich in energy, but we are also food producers and we are beginning to exploit its mining and knowledge industry wealth. That is where our country will emerge and grow.”Pesce said in dialogue with Radio 10.
To promote this process, he said that it is essential to develop the capital market in pesos, to transform the savings of millions of Argentines into investment in infrastructure.
“Today the Central Bank has 5 trillion pesos in fixed terms, which is 45,000 million dollars. Argentines have the capacity to save to carry out investments. We have a complex situation that must be faced, which has to do with the fact that Argentina it had not been growing, that it had to face the pandemic and now we are with this problem that the war has generated”Fish said.
“The global imbalances regarding the problems we brought have maintained inflation levels that do not seem positive to us. We hope that when these external shocks cease, inflation will moderate and we will be able to grow with stability.”Miguel Pesce
Regarding the price level, he stated that “The global imbalances regarding the problems we brought have maintained inflation levels that do not seem positive to us. We hope that when these external shocks cease, inflation will moderate and we will be able to grow with stability.”
Asked about the price of the dollar and the narrowing of the gap with the parallel prices, he pondered that the agreement with the IMF made it possible to clear the “two precipices, which were the maturities of US$ 19,000 million in 2022 and 2023 with the IMF that were impossible to face”.
“That was immediately reflected in the price of the dollar against titles or in the illegal market”Pesce assured.
Regarding the levels of international reserves, he said that the country is “with very high import levels, due to economic growth, but also due to the rise in international prices and the dismantling of logistics chains and the increase in freight costs that make it necessary to face very high prices”.
Regarding the debt in pesos contracted in recent years, he said that “The Government had to face the pandemic and with public spending, the drop in income and consumption that the pandemic produced was partially compensated. This was partially compensated with public debt and in part with Central Bank issuance. In both cases, has moderated.
“Argentina needs to develop its capital market and there is no capital market that develops without having a solid and liquid public securities market. And part of that has to do with debt issuance, which corresponds to a strong presence of the State in investment in infrastructure, such as the Néstor Kirchner gas pipeline or the updating of nuclear power plants”hill.
