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Coronavirus: Argentina unveils stimulus package; ample support from the political system to the strategy

Thursday, March 19th 2020 - 08:59 UTC
Full article 6 comments

Argentina unveiled this week a 700 billion Pesos (some US$10 billion) stimulus package to try to sustain economic activity, avert shortages of food and medical supplies, help companies and protect workers and vulnerable groups affected by the worsening Covid 19 pandemic. Read full article

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  • DemonTree

    Sounds reasonable, and not dissimilar to what other countries are doing, but where is the money coming from?

    Mar 19th, 2020 - 08:14 pm - Link - Report abuse 0
  • Chicureo

    DemonTree

    Very easy. The Banco Central releases more money into the economy. You can see the direct result on the currency exchange rates. Currency deflation will impact Latin America hard.

    The scary situation is exports are severely declining as markets have slowed dramatically.

    ¡Salud!

    Mar 20th, 2020 - 06:52 pm - Link - Report abuse +1
  • pgerman

    After deeply reading the economic announcements, I must admit that I totally agree with “chucureo”.

    Comparing Argentina with countries such as the USA or France is to ignore the base problem of the Argentine economy. Argentina does not have a reliable currency to have an expansive policy.

    The attitude of the Argentine government is extremely dangerous. Having a very high inflation (50% annually), entering the default with an oversupply of Argentine pesos in the market but a zero demand for Argentine pesos, the chances of accelerating inflation are extremely high.

    The continued recession since 2011 may accelerate this situation. Actually, I see that the current Argentine government is very disoriented and simply taking short-term measures that have already failed.

    Argentina had a fiscal deficit of 0.45% in 2019. It was time to continue working on reducing the deficit and the weight of the state that drowning the economy.

    I really don't get it, it's suicidal !!

    Mar 21st, 2020 - 09:41 pm - Link - Report abuse +1
  • Chicureo

    Pgrman

    Actually I was being polite by not making derogatory comments about the reckless political mismanagement of what should be one of the greatest economies in the world.

    Quantitive easing of Argentina's currency has been a tried and true short term solution to quickly solving problems that ultimately results in hyperinflation. (All of my generation remember ALL our country currency crisis.)

    Chile is in serious economic trouble because our primary export market is China, but the economic fundamentals remain strong. We have a independent central bank and a conservative emergency fund for disasters, which will help bridge this crisis. Yet we recognize we're in trouble.

    Argentina lies somewhere between enormous disaster and complete economic collapse unless the government takes swift changes in monetary policy. But on the bright side, Argentina is not Venezuela...

    The legacy of Juan Peron continues.

    ¡Salud!

    Mar 22nd, 2020 - 04:25 pm - Link - Report abuse 0
  • Enrique Massot

    The Argentine government injects some US$10 billion to keep the economy going, while ensuring access to food and medical supplies, help companies and protect workers as the pandemic grows.

    And what PGerman and others say?

    They cry foul!

    “I really don't get it, it's suicidal!! exclaims Mr. German. ”It was time to continue working on reducing the deficit.”

    Newsflash to you, German. There was a change in Argentina last December; there is now a government looking after the well being of the people and the economy, unlike the gang of zombies and thieves that were in place before.

    This new government knows it has to inject some cash to keep the economy alive, while helping those who are going to suffer the most during this pandemic.

    Obviously this not your concern. You don't even take notice a tragedy is in the works; you want the government to squeeze whatever people still have in their pockets and don't care about anything else.

    The current government's direction is suicidal, says PGerman.

    Many Argentines believe they did avoid collective suicide by electing Alberto Fernandez and sending Macri and his gang to oblivion.

    Mar 24th, 2020 - 04:46 am - Link - Report abuse -2
  • pgerman

    Dear Enrique

    Argentina is a country whose economy has been in recession since 2011 when CFK was ruling the country. As an aggravating circumstance, it has high inflation for more than a decade and a fiscal deficit that (in 2019 was “only” 0.45%) consumes all of society's resources. As a result, it does not have its own currency (the Argentine peso is rejected by its own citizens) to the point that populist governments have to ban the sale of foreign currency to prevent workers from protecting their savings. In other words, they force workers to be exposed to inflation.

    In this situation you believe that injecting an impressively large mass of Argentine pesos (simple painted papers without any backing or trust) will “activate” the Argentine economy. Well, it is what the last Argentine governments have done without any success ...

    At this point I already wonder whether you, Mr. Enrique Massot, are a rational person with whom it is possible to discuss reasons and ideas or you are simply a childish fanatic without the slightest reasoning ability ...

    Mar 24th, 2020 - 01:39 pm - Link - Report abuse +1
  • Enrique Massot

    Oh come on, pgerman, stop your paternalistic ramblings.

    Argentina's current government presided by Alberto Fernandez is not, of course, going to ever get your approval and that's fine.

    In fact, if I ever saw you clapping on any of Alberto Fernandez government's measures, I would be alarmed.

    Conversely, the more I see you ranting, the more I trust Alberto. He is working real hard to undo the damages inflicted during the last four years by Macri and his merry gang of highway robbers (don't forget to check on the progress of related judicial processes).

    In the meantime, you can keep reciting your Chicago Boys dogma to entertain la galerie.

    Mar 25th, 2020 - 05:08 am - Link - Report abuse -2

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