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FILE PHOTO: Argentine President Javier Miley looks on as he attends a Hanukkah celebration in Buenos Aires, Argentina, December 12, 2023. REUTERS/Tomas Cuesta//File Photo
BUENOS AIRES, Argentina (AP) – Argentina on Tuesday announced major cuts to its budget and cuts to energy and transportation aid as part of a surprise measure that new President Javier Miley said was needed to deal with an economic crisis.
READ MORE: Argentina’s new President Miley has warned of a sudden change in the economy
The Minister of Economy Luis Caputo said on television that the Argentine peso will depreciate by 50% to 800 to the US dollar from 400 pesos to the dollar.
“For a few months, we’re going to be worse off than before,” Caputo said, two days after the libertarian Miley was sworn in as America’s second economic president in South and early warning about difficult procedures.
Milei said that the country has no time to think about other ways.
Argentina is suffering 143% annual income, its income has fallen and four out of 10 Argentines are poor. The country also has a financial deficit, a trade deficit of $ 43 billion, with an outstanding debt of $ 45 billion to the International Monetary Fund, and $ 10.6 billion due to multilateral and private creditors. April.
As part of the new measures, Caputo said that the government is canceling the tenders of any government jobs and eliminating some state jobs to reduce the size of the government.
He also announced the reduction of energy and travel aid without giving details or saying how much, adding that the Milei’s administration is reducing the number of departments from 18 to 9.
The governor said that measures are needed to reduce spending which he believes is the cause of the country’s economic problems. including inflation.
“If we continue as we are, we will definitely move towards hyperinflation,” said Caputo. “Our mission is to avoid a disaster.”
The IMF welcomed the measures, saying they provide “a good basis” for further discussions with Argentina about its debt with the organization.
“These first bold actions are intended to improve public finances in a way that protects the most vulnerable in society and strengthens the management of external transactions,” said IMF spokesperson Julie Kozack in an explanation. “Their implementation will help stabilize the economy and lay the foundation for a more sustainable and private-sector-led economy.”
Major figures in the former Peronist government of Alberto Fernández did not comment on the measures announced on Tuesday.
But the socialist leader Juan Grabois, who is close to the former center-left president Cristina Fernández (2007-2015), said that Caputo announced “a general massacre without the threat like a psychopath will kill his victims.”
“Your salary in the private sector, in the public sector, in the popular, social and economic cooperation, in cooperation or in the private sector , for retirees and retirees, you will get half off at the supermarket,” he said. “Do you really think people won’t object?”
“There’s no money,” is a common word in Miley’s speeches, used to explain why a graduation system is unfounded. But he promised that the adjustment will almost certainly affect the state rather than the private sector, and that it represented the first step in regaining prosperity.
Miley, a 53-year-old economist, appeared on television to lash out at what she called government policies. He parlayed his popularity into a congressional seat and, just as quickly, into the presidential race. The dramatic victory of the “anarcho-capitalist” he declared in the first year of August sent shock waves in the political situation and shocked the race
Argentinians who were unhappy with the economic situation proved to accept the ideas of a foreigner to solve their problems and change the government. He won the election on November 19 second with certainty – and sent the accumulation of Peronist political power that has ruled Argentina for many years. However, he is likely to face strong opposition from the Peronist movement’s lawmakers and the unions they control, whose members say they refuse to lose wages.
On Sunday, Miley was sworn in at the National Assembly, and President Alberto Fernández gave him the presidential sash. Some of the assembled politicians shouted “Free!”
Many Argentinians are wondering who Miley will rule their country, the person who uses the chain, the opposition to the establishment of war from the way of competition, or more his humble president-elect emerged in recent weeks.
As Milei’s candidacy, he pledged to rid the political system of corruption, abolish the Central Bank which he accused of printing money and stimulating the economy, but instead the peso is rapidly depreciating against the US dollar.
But when he won, he called Caputo, a former president of the Central Bank, to be his minister of economy and one of Caputo’s partners to lead the bank, it seems that his plans were put on hold. more for financing accounts.
Miley has shown herself to be an ardent fighter against social injustice around the world, just like former US President Donald Trump, whom she admires.
He said during his opening speech, however, that he had no intention of “oppressing anyone or appeasing the old people,” and that any politician or union leader who wanted to support his project would a “received with open arms.”
His apparent superiority may stem from honesty, given the scope of the great challenge before him, his political inexperience and the need to using alliances with other parties to implement his agenda in Congress, where his party is a distant third in the number of seats it holds.