Argentine President Mauricio Macri announced this Monday (3.9.2018) a fiscal balance plan that foresees a drastic reduction of his government, which 22 members are now down to less than half, and drastic measures such as an export tax are in place.
Macri assured that with this he tries to give the markets a Clear signal of spending control to stop deficit and inflation, accelerated in recent days by an excessive depreciation of the peso against the dollar, in addition to banishing corruption forever.
The president, who admitted to having been too optimistic in his forecasts, justified the dramatic reduction of his cabinet “to less than half” due to the seriousness of the moment, which in his opinion requires “compacting” his most direct government team “to give the most focused response to the upcoming agenda.”
Emergency
Likewise, Macri pointed out that "to cover what is missing during this transition that has become an emergency," he will ask that "those who have more capacity to contribute" do so, referring to the fact that export taxes will be increased.
He also said in his message that his change is “root-rooted, deep and true,” he assured that “we all have to give in on something if we want to change” and regretted that, with Argentina being “potentially one of the richest countries in the world,” a third of its population lives in poverty.
External situation
However, after two and a half years of Government, the “situation changed” due to external factors, such as the rate hike in the United States, the Turkish crisis and Situation in Brazil, and internal because “We were not able to show unity in our commitment to advance structural reforms,” which caused those who lent the money to “begin to doubt,” the president noted.
Corruption
According to him, all this was joined by the "notebook scandal", a case in which an alleged network of bribes from public works contractors to officials during Kirchnerism (2003-2015) is being investigated, something that, in his opinion, "in the short term affects the image of the country and raises more doubts.”
Devaluation
The president admitted that, with the devaluation of the local currency, “poverty will increase”, which is why he announced a “reinforcement” of social allocations for the last two months of the year and other measures to try to alleviate the impact on the most vulnerable sectors.
"We must continue together forward, with the determination that it is possible."I have the necessary strength and I am here for you, but I need you more convinced than ever against the preachers of fear," he said.
Source: Reuters
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