Why don’t more investments arrive in Argentina?

Economist Juan Carlos De Pablo highlighted the anti-inflationary plan, detailed why more investments are not coming to Argentina and assured that the Minister of Economy, Luis Caputo, has an advantage that allows him to make decisions.

With these definitions, he referred to the economic context of the country, and also made reference to the Base Law.

“People are talking about the Bases law and I say stop: first, let it be approved, second, let the official content be published. Once the text is there, let’s talk to the experts on each bit of it. I understand the political point of view that Yes, no, the markets, but the reality is that it has not yet been approved. First it is approved, then it is published and then we do the analysis,” said the economist about the norm that will be debated next week in the Chamber. of Deputies.

In that framework, It minimized the anticipated celebration in the markets with the dollar and the rise in stocks in New York. “All of these are rationalizations for one side and for the other, I don’t even give a damn to those who speak from one side. The world of rationalizations is not useful for making decisions. The first thing you have to look at is a counter, there are First, look at what is happening to you and why you think it is happening to you, what is happening to you. Second, look at what is happening to those who are in the same sector as you,” he explained.

The importance of everyday life in the economy

De Pablo also did not recommend not seeing beyond the day to day. “When someone tells you ‘how do you see September?’, I don’t see next week. Let’s stop screwing around, this is absolutely fluid,” he responded in dialogue with Radio Con Vos, and referred to the stabilization plan, the anti-inflationary plan is not a plan

“Everyone is talking about recession. INDEC last week said in both industry and construction, adjusted for seasonality, April was better than March. FIEL just said with the same criteria, May was better than April, although that month gives you a negative result. What we are seeing is whether this begins to turn around or not, the rule is heterogeneous. You talk to the mining sector and they are celebrating, the guy who sells blenders wants to kill himself,” he analyzed.

The economist gave his opinion about the arrival of investments in the country.

The economist reiterated that in economic policy must have “concrete things” as a reference which are the laws, decrees, resolutions and communications, and asked to downplay the importance of the statements. “I don’t care about the rest,” she said.

Furthermore, De Pablo assured what is the only tool that Javier Milei clings to. “The President has no governors, no mayors, he has few senators, few deputies, few economic policy instruments, that is why the fiscal balance clings, because he has no alternative. It is as if you were on a sailboat in the middle of the Río la Plata , with a terrifying storm and your rudder and sail broke and you are clinging to the only thing you have: there is no money in this and that’s it, let everyone rate it however they want,” he said.

“The President talks about substantive things when he tells legislators: ‘you can vote for any law that compromises the fiscal balance, I will veto it,’ and if he has to veto it, what he has to do. Here’s the thing , this is not from the Austrian School, this is from a grocer, with the forgiveness of the grocers, but he also asked for those two objectives to which he clings, let’s say, like the air he needs to breathe. He is close to achieving it,” estimated the specialist. , author of several books, who recently presented the latest “The Kitchen of Argentine Economic Policy” (Ed. Sudamericana) co-authored with Ezequiel Burgo.

In that line, celebrated the slowdown in price increases and the anti-inflationary effect. “The inflation rate was 25% monthly, then 20%, 15%, when now it was 4.2%. I have no problem if the June inflation rate was 6%. I don’t know if from a political point of view it is wants to kill, or what would be worse, they begin to freeze for fear of thinking that 4.2% in May is the ceiling. Today you have a systematic fall, it is evident that the anti-inflationary fight has caused a phenomenal fall in the rate of inflation. inflation,” he stressed.

The arrival of investments in the country

When asked about the arrival of new capitals for the approval of the Incentive Regime for Large Investments (RIGI), De Pablo assured that everything is always latent in Argentina. “They tell me ‘assure me that Cristina does not return in 2027’, and I am the one to assure you that. God created businessmen so that they think little and do a lot, and thank goodness. If Mr. Tesla comes here it is not because Milei finds it funny, but because it is a business opportunity“he clarified.

Along these lines, he explained why fewer investments arrive in the country. “They come here to set up a car factory until they do the paperwork, get the land, build the factory and when four years pass, this man, who everyone says is very intelligent, Is a real investment going to condition me on removing the stocks? In four years we Argentines took out the trap, we put it in, we take it out, we put it in. What is the problem? Based on the same uncertainties that we generate ourselves, any national or foreign investor to make an investment has in mind an expected rate of return higher than that of a more stable country. For this reason, there are fewer investments than would be expected in a more stable country, that is Argentina,” he said.

When mentioning his latest book and comparing other economic periods from Arturo Frondizi to Mieli, De Pablo said that the President “beyond the fact that he is an economist by profession or style” is “really convinced of what he does.”

“I am not in the meetings where (Luis) Caputo is with the President, so I don’t know how they design economic policy, But I can tell you based on the experience that is included in that book that a Minister of Economy who does not have a President behind him to support him is in serious difficulties. It’s an elementary thing. Caputo is encouraged to say things and do things because he has Milei behind him,” he stressed.

 
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