October 18th, 2024
1. Javier Milei closed the 60th IDEA Colloquium
President Javier Milei closed the 60th IDEA Colloquium, which focused on the axes of transformation, investment and sustainability. This event brought together business leaders, politicians and academics to discuss Argentina’s current economic challenges. In his speech, the President mentioned that the hardest part of his economic plan was implemented in the first months of the year. Regarding the exchange rate, Milei stated: “We are allowing supply and demand of dollars to be mapped voluntarily by individuals”, assuring that this approach will avoid abrupt fluctuations that could affect the productive sector. He also highlighted the potential of the country’s energy resources, copper and lithium, to contribute in terms of investment and development. Also present were the Minister of Economy, Luis Caputo, who spoke about the current economic situation and the strategies needed to boost growth, and the Minister of Deregulation and State Transformation, Federico Sturzenegger, who defended the deregulation of the public sector as a way to encourage investment and streamline the economy.
2. September closed again with financial surplus
During September, the National Public Sector (SPN) again recorded a financial surplus of Ch$466.631 billion, as a result of a primary surplus of Ch$816.447 billion, and of an interest payment on public debt net of the intra-public sector for Ch$349.816 billion. This primary result is consistent with an expenditure path considered sustainable, and is generated by revenues related to specific situations such as the resources obtained from the Special Income Regime on Personal Property Tax (REIBP). Thus, in the first nine months of the year, the SPN accumulated a financial surplus of approximately 0.4% of GDP (primary surplus of approximately 1.7% of GDP).
Ministerio de Economía: En septiembre el Sector Público Nacional volvió a registrar superávit financiero, por $ 466.631 millones, luego del pago de intereses por $ 349.816 millones
3. Health insurance will increase by up to 6.9%, above inflation
In November, prepayment fees will rise between 3.9% and 6.9%, depending on the plan and the company, once again exceeding inflation. Companies such as Galeno, Hospital Italiano, Swiss Medical and Accord Salud justified the increases by the rise in medical costs, supplies and services, and seek to maintain the quality of service. Since July, when the prepayment companies were authorized to adjust their prices freely, there have already been five increases during the year, reflecting the inflationary pressure in the health sector.
Ámbito Financiero: Prepagas: en noviembre, los aumentos serán de hasta 6,9%, por encima de la inflación
4. Lowering of tariffs on imported goods is made official
Through Decree 908/2024 published this week in the official gazette, the reduction of tariffs on multiple consumer goods announced by Minister of Economy Luis Caputo was made official. Among the goods covered are motorcycles, tires for cars and motorcycles, small household appliances, coffee, LED lights, etc. In addition, tariffs are reduced on inputs relevant to the economy, such as PET and ABS plastics and synthetic yarns used by the entire textile industry: laicra and polyester. Finally, tariffs on various types of machinery are reduced and the previously announced reductions on molds and dies and irrigation equipment are implemented.
5. Government starts negotiations with the opposition for the 2025 budget
The Argentine government started negotiations around the 2025 Budget, with the aim of achieving approval. The government needs agreements with several blocs to obtain the necessary majority for the approval of the project, and a definitive consensus has not been reached. In a meeting with legislators of the UCR, differences were discussed on several points, such as the resources destined for universities, the mobility of family allowances and the use of funds coming from increases in tax collection. In addition, the radical bloc proposed that the additional funds be used to reduce taxes and asked for more resources for universities. Another relevant point in the discussion of the budget is that the government foresees, as stated in the draft 2025 Budget, an annual inflation rate of 18.5% and an average annual inflation rate of 28% for next year. However, there are consulting firms that questioned these predictions and anticipated an inflation of around 35%.
Ámbito: El blue cayó y perforó la barrera de los $1200, el valor más bajo en más de cuatro meses