Miguel Ángel Broda: “If the government obtains a majority in Congress, our path to Venezuela is paved”

Economist Miguel Ángel Broda made harsh predictions about Argentina’s economy after the election and anticipated that the election results will be key to changing Argentina’s future: “If the official party gets a majority in Congress, our path to Venezuela is paved“, He anticipated.

“These are very important elections. The main decision for Argentina’s future is to prevent the official party from gaining a majority or being close to a majority in Congress, in order to do what it wants. This is crucial. Otherwise, our road to Venezuela is paved. We must prevent the Government from obtaining a majority in the deputies. It is clearly a primary objective that will change the future of Argentina, ”he said Thursday in statements to Radio Miter.

The opposition does not have a strategic economic discourse to get out of decadence; but it may be that a triumph of the opposition opens a small light at the end of the tunnel

“The opposition does not have a strategic economic discourse to get out of decadence; But it may be that a triumph of the opposition opens a little light at the end of the tunnel and we have a chance to be a normal country. Today Argentina is isolated from the world. Nobody cares about Argentina and we have to change that. Doing what the rest of Latin America has done, which has 3%, 4%, and 5% inflation, a growth rate, attracts investment. Everyone has already done it. The election can give hope and that this acceleration of the decline can be stopped ”, declared the economist.

Regarding the US government’s report on the Argentine economy, where he speaks of “economic uncertainty and interventionist policies,” Broda noted that Argentina’s economic policies are highly predictable. “The economic model is an ideologically anti-capitalist model, isolated from the world, with friends like Nicaragua, Venezuela, Cuba, Russia and China. He is an incompetent model. All that has been announced is sarasa and the results are the opposite. There is extraordinary mediocrity in management, ”said the economist in dialogue with Radio Miter.

According to Broda, the Argentine model is predictable because it opposes any common sense model. The economist has predicted that the government has entered the “electoral key”, so it will try to avoid a currency crisis, that inflation continues to fall and will have a “very expansive” fiscal and monetary policy for the payment of wages. , pensions, pensions and social and economic subsidies.

“We have experienced five months of fiscal and monetary austerity but now we are at a turning point where the program enters an electoral key. (The Minister of the Economy) Martín Guzmán wants to survive and adapts his history so that it is tolerable by the Instituto Patria. We are going to have a primary deficit of 4 points; we are going to broadcast 17 times more in the second half of the year than in the first and we have significant tension. The K model is absolutely incompatible with any agreement with the Fund, ”said the economist.

We have experienced five months of fiscal and monetary austerity but now we are at a turning point where the program enters an electoral key

Broda warned that the IMF, beyond the changes it has seen in recent years, demands fiscal, currency and exchange rate consistency and announcements of liberalization of controls. “This goes against the goals of Cristina Fernández de Kirchner and Máximo Kirchner. We had the first five months of the year of fiscal and monetary austerity and already in June the tip of the iceberg began to appear. We consider a very expansionary budgetary and monetary policy which, without a serious program, will increase the rate of inflation for next year, ”he anticipated.

“The numbers are there. An effort has been made but the socio-economic situation and the sanitary failure require expansionary policies to increase consumption and accelerate the recovery ”. In the aftermath of the parliamentary elections, Broda spoke of a major macroeconomic mess to come. “After November 15, you have a cold down your back,” he said. And he predicted that in the second half of the year, the central bank will switch from buying to selling dollars.

According to Broda’s forecasts, in 2022 the country will have 11% less GDP per capita than in 2017. human and physical capital that jeopardizes our potential growth rate. If we do not return to normal, to return to the GDP per capita of 2017, it will take us 30 years, ”he predicted.

“This government’s methodology is absolutely temporary, without strategy; looking at the symptoms of the problems and not the causes. When listing official announcements, or sarasa official, all the results are exactly the opposite of the desired objectives. We are restructuring debt to replace debt, and today that is not possible. The volume of exports is decreasing. We are talking about lowering inflation and the rate is 58% annualized. We are talking about recovering the real salary and the economy has fallen and the real salary has fallen, ”he summed up.

Argentina is the only country in the world that is accelerating its decline, with the exception of Venezuela

“In my opinion, the debt was sustainable and we should not restructure,” Broda said. Heterodox statism found it inexorable. The last part of Mauricio Macri’s government was also not satisfied with this issue. This is the only case in the world where after restructuring we have this risk that prevents us from borrowing. The truth is very difficult to find success from this government. His story is magnificent, but the numbers are exactly the opposite of what he was looking for ”.

On the future of the country, Broda painted a grim picture. “Argentina accelerates decline, making stagnation and inflation a chronic problem. Argentina is the only country in the world that is accelerating its decline, with the exception of Venezuela, “he said. And he regretted that the electoral discussion did not talk about what are the instruments that can make Argentina a normal, stable country with sources of growth and employment which can attract investment.

“We are the world record for macroeconomic crises. In the past 12 years, there have been five recessive periods. It started in April 2018, when savers who funded the record deficit for us realized the infeasibility of the economic program, ”he added.

However, Broda has indicated that he does not expect a currency crisis before the election and that the inflation rate will drop slightly. “Later we will see if we can make a deal with the IMF, which is absolutely necessary. What the Fund does is disburse in the morning what it has to collect in the afternoon. It needs a conditionality of common sense which seems very far removed from the economic program K ”, he underlined. And he recalled that in March a debt of $ 4,000 million expires. An agreement would therefore allow 2022 and 2023 to go through a great crisis. “Today, the result is open,” he concluded.

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