The management of Nicolás Dujovne in figures: dollar, inflation, deficit and activity

Nicolás Dujovne took command of the main chair of the economic team in 2017, after the resignation of Alfonso Prat Gay and when the economy began to recover after the recession of 2016, with inflation of 1.3% per month and a dollar just above $ 16. After 31 months, most economic variables declined, including economic activity, which experienced another sharp fall throughout 2018, a spike in record price increase since 1991 and a currency near the $ 60.

The outgoing finance minister was the guardian of the two agreements signed by the national government with the International Monetary Fund, in June and September 2018, with the aim of reducing the currency crises that shook the economy. The IMF's badistance program included a central element that Dujovne filled from month to month: reduction of public expenditure to reach the end of the year the zero deficit.

The magnitude of the proposed cost reduction in the state accounts led him to say that "An adjustment of this magnitude has never been made without the fall of the government".

Dollar

At the beginning of his tenure, Dujovne received a dollar just above the $ 16. The US currency had made a big jump at the end of 2015 after the exit of the exchange rate, but it maintained its stability throughout 2016 and even in 2017 thanks to the entry of dollars into the economy by the foreign investments but also by the debt issues that it has generated. The State in the international market.

The two exchange crises of 2018 – late April and August – caused jumps in the price of the currency. The rapid exit of investors from Argentine badets caused this monetary escalation which forced the government to ask IMF badistance.

In 2019, after a certain instability of the dollar at the end of March, from April to mid-July, the exchange rate remained controlled, even down. But with the negative result obtained by the ruling party in primary elections, the currency has again risen sharply, which brought it last week to a ceiling of 63 dollars. Friday, after the last exchange wheel before the resignation of Dujovne, the greenback closed at $ 58.12. This represents during your management a dollar rise of 263%.

L & # 39; inflation

As of January 2017, monthly inflation was about 1.3%although, in the following three months, it averages 2.5% for adjustments to utility rates. Until December of this year, the consumer price index was still lower than the 2%but in the last month of the year, he jumped up to 3.1%. This development is accompanied by a rise in the exchange rate during the latter part of the year, which has accentuated the pressures on the general price level.

The year 2018 was one of the disappearance of the inflation targets expected by the government. The objective pursued by the Central Bank was at the origin of 15% for the whole year, but the two strong variations of exchange rate this year pushed the dollar and the therefore, the rate of price increase.

In this way, the inflation of all 2018 ended up being 47.6%, an unpublished figure since 1991, when the economy emerged from hyperinflation. The CPI even experienced a spike in 6.5% per month in September of last year. The price increase accumulated during his tenure was 84.8%.

Economic activity

The recession that the economy suffered in 2016 due to the rising dollar after the disruption of the exchange rate and the thaw of tariffs eased at the end of 2016, so that During the first months of 2017, the economy has already posted its first positive figures. Except in February, Indec's year-to-year activity measure reflects progress made.

But in 2018, successive dollar increases and an inflationary recovery plunged the economy into a depression. The red numbers in the Monthly Economic Activity Estimator (EMAE) appeared continuously from April 2018 to May of this year.

The worst time for the economy came in the last months of last year, when the city experienced interannual landslides. 7.5% in November and from 7% in December. During his tenure, Dujovne ended with 15 months with a growing economy and 14 with falls.

Fiscal deficit

The agreements signed with the IMF were among its decisive points the condition of adjustment of the accounts of the State. In this way, the Monetary Fund sought to reduce the need for the country's debt to cover this fiscal gap. The goal for this year was reduce this deficit to zero.

Dujovne has done this by reducing different branches of public spending, mainly subsidies, transfers to the provinces and public works. A little over a month ago, he had even announced that during the first half, the Treasury had exceeded its budget target since it was "the first time in eight years that the national non-financial public sector has a first semester with a primary surplus ".

The latest financial data from its mandate reflected a Surplus of $ 30,000 million for the first six months of the year. In any case, the series of measures announced last week by the national government to mitigate the consequences of the exchange rate rise will put pressure on the account adjustment trajectory initiated by Dujovne, which, according to some private calculations, will result in expenses of approximately 100,000 million dollars.

Poverty and unemployment

On the social indicators side, the last two and a half years, during the management of Dujovne in front of the finance palace, have had setbacks. Regarding poverty, the official indexes marked towards the end of 2016 a 30.3% poor people all over the country. In 2017, the indicator fell to 25.7%.

But according to the latest official data, by the end of 2018, he still hit up to 32%. Private estimates speak of one 35% in the first quarter of this yearAlthough the measures of poverty are half-yearly, the figures for the first six months of 2019 will be known in September.

With regard to unemployment, the measure in the first quarter of 2017 gave the following result: 9.2% Average across the country. Two years later, with data for the first three months of 2019, this percentage had risen to 10.1%. Thus, unemployment reached double digits for the first time since 2006.