The recent series of economic measures adopted by the president of Argentina, Javier Milei It marks a crucial turn on the course of the country’s economy. This approach, which includes the elimination of a significant part of exchange controls and the implementation of an Argentine peso flotation system in a range of between 1,000 and 1,400 pesos per dollar, has been interpreted by analysts as an attempt to normalize an economy that has been under restrictions for long periods.
According to the journalist Juan Pablo Spinetto In its column published in Bloombergthese measures represent an effort to make Argentina an economically stable and predictable country.
Reforms and Risks: Milei’s economic plan, under Spinetto’s magnifying glass
In its analysis, Spinetto emphasizes that the lifting of exchange controls is a fundamental step in the right direction, although it also implies considerable risks, particularly as regards inflation and financial stability.
The journalist recognizes that the process is full of uncertainties, but emphasizes that these types of decisions are crucial to restore economic normality. “This is an ambitious attempt to make Argentina a normal country once and for all”Spinetto said, suggesting that Milei’s decisions represent a structural change that could improve the economic situation of the country in the long term. However, he also highlighted the need to have both internal and international support to guarantee the success of the plan.
One of the aspects that Spinetto underlines with special emphasis is the flexibility of the Argentine government to adapt to the changing circumstances of the market. Although it is not known with certainty if Milei’s decisions were part of a premeditated strategy or if they were driven by recent difficulties in financial markets, the author praised the president’s ability to adjust his approach according to the needs of the moment.
“Milei deserves credit for adapting its strategy to changing circumstances, “says Spinetto, recognizing the importance of adaptability in such a volati economic environmentl.
Milei seeks fiscal surplus in 2025 with support from the IMF and geopolitical support
In addition, the Argentine government fiscal commitment, which includes A budget adjustment destined to reach a 1.6% surplus of the gross domestic product (GDP) in 2025, It was also highlighted in Spinetto’s analysis. “It is the opposite of what politicians in search of votes usually do,” he argued, pointing out that this initiative could be key to restoring confidence in the national economy.
According to the column, the government’s financial program has the support of the IMF and other multilateral organisms, which strengthens the credibility of the new exchange structure. In addition, the visit of Scott BesentSecretary of the United States Treasury, to Buenos Aires and the renewal of a currency exchange agreement with China, provide an important geopolitical support. “The sovereign bonds rose, indicating that the plan goes in the right direction“He said.
Spinetto warns of inflationary risks and political challenges of the economic plan
Anyway, the future is still uncertain, as he says. Argentina runs the risk of experiencing an inflationary increase in the short term after the implementation of a floating currency, although it is handled within certain limits.
The journalist also emphasizes that these types of programs do not ensure success, referring to the country’s economic history. “If this is the IMF twenty -three program with Argentina since 1958, it would not be strange to think that the country is challenging historical probabilities“He reflected.
The column also highlights the political context as a crucial challenge. In a country where many of the leaders show distrust of market rules, the author warns about the need for caution: “The government must keep the feet on the ground, avoid unnecessary bluff and be prepared to adjust the program as circumstances demand.” According to your analysis, The success of the plan will depend on the ability to implement structural reforms.
Crisis history and absence of orthodoxy: the diagnosis of Argentina
The journalist explains that Argentina’s economic history was marked by a succession of constant crises. “From hyperinflation to corralitos, devaluations and capital controls, we have seen everything,” he said. And it emphasizes that the only thing that has been absent in this history is the implementation of an orthodox plan that integrates excessive spending and the uncontrolled emission of money.
The current government approach represents, according to the journalist, a marked contrast regarding what he defines as a “Non -orthodox practice and poor management“which has characterized Argentine economic policy in recent decades. In its analysis, it points out that the decision to implement”A large fiscal adjustment – and not after – of the financing of the IMF “could make a difference with respect to previous attempts.
However, he warns that The outcome of this strategy will depend largely on the quality of its implementation and the ability of the government to adapt to both internal conditions and international scenario challenges.
In the final part of its column, Spinetto raises the possibility that the current economic strategy represents a turning point in the country’s trajectory. When reflecting on his experience, he mentions that, at fifty, he has not witnessed a prolonged period of economic stability in Argentina.
However, it emphasizes that the measures adopted could open an unprecedented opportunity: “We could be facing the opportunity to have a macroeconomy that provides financial stability and promotes growth“
