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ARGENTINA | 26-11-2023 18:05

Luis Caputo: Economist Macri dubbed 'Messi of finance' lines up with Milei

Despite Javier Milei’s backing, the potential arrival of Luis Caputo to the Econony Ministry has sparked unrest within the ranks of La Libertad Avanza and underlined the influence of Mauricio Macri on Argentina's next government.

The once-familiar face of Luis 'Toto' Caputo has emerged as one of the leading candidates to take charge of the Economy Ministry in president-elect Javier Milei’s new administration.

Caputo, 58, a former governor of the Central Bank and ex-finance minister, has been praised by Milei in recent television interviews. 

Caputo’s possible appointment in an area of vital importance for the new government would confirm the strong influence of former president Mauricio Macri on the composition of the Cabinet which will accompany the president-elect in power.

“Caputo is someone in a position to hold this post, with the necessary experience to dismantle the situation we’re in,” said Milei in a recent interview.

“He has the necessary expertise to solve the monetary problem and provide a solution from financial markets to get out of the issue of the Leliqs and ending foreign exchange restrictions,” the La Libertad Avanza leader concluded.

Caputo is expected to put the libertarian’s dollarisation plans on hold and seek a “non-disruptive roadmap” for the short-term that will win over markets.

Rumours of his arrival to Milei’s top team has created unrest within the ranks of La Libertad Avanza leader. The head of the president-elect’s economic advisory team, Carlos Rodríguez described Caputo as “a finance man” who is “not minister material” and specialises only in “the speculation of financial assets,”

What’s more, last Thursday rumours began circulating that economist Emilio Ocampo – once seen as Milei’s point man for dollarisation – would no longer be taking charge of Argentina’s Central Bank, with most analysts putting the decision down to Caputo’s prominence.

Economist and university professor Diego Giacomini – former best friend of the president-elect – said last week that Milei had “always looked down on Luis Caputo because he knows nothing about economics and can only put citizens in debt and make money by gambling.”

A graduate in economics from the University of Buenos Aires (UBA), Caputo spent much of his career in the private sector, accumulating experience with US banking giant JP Morgan and later, Deutsche Bank. He is currently the head of Anker economic consultancy firm and has been advising Milei on economic matters.

The likely economy minister is the cousin of Nicolas ‘Nicky’ Caputo, a construction businessman who is one of Macri’s closest friends. His brother is Claudio Caputo, the late father of Santiago Caputo, the 38-year-old political scientist who worked intensely on the La Libertad Avanza election campaign and whom Milei called the “architect of victory.”

 

Return to prominence

If he should become the next economy minister, this will not be Caputo’s first rodeo. During Mauricio Macri’s 2015-2019 administration, he was finance secretary and then finance minister until 2018, when he lost his post to take over the Central Bank after Federico Sturzenegger’s exit (incidentally, the latter is also a candidate for the economy minister post).

Under Macri – who once dubbed Caputo the “Messi of finance” – as finance secretary he renegotiated an agreement with the so-called “holdouts” for around US$16.5 billion that allowed Argentina to return to international credit markets. Caputo also issued a controversial 100-year bond.

During his time in office, Caputo famously took part in negotiations with the International Monetary Fund over the record US$57-billion loan granted to Argentina in 2018 under Macri’s Cambiemos government.

Caputo is one of a number of ex-Macri administration officials who are under investigation by the courts due to the historic IMF agreement. 

Both he and Macri, among others, have been denounced for the alleged crimes of “fraud due to aggravated mismanagement to the detriment of public administration and misappropriation of public funds.”

Regardless of the volume of indebtedness (US$45 billion) and the conditions imposed by the international body in terms of devaluation of the peso and adjustment of public expenditure, there is an internal investigation underway due to capital flight.

After the leak of the Paradise Papers in 2017, Caputo once again became a subject of controversy.

Media reports indicated that when he took public office, he was a shareholder in offshore companies created to manage hundreds of millions of dollars in tax havens. This was revealed by official documents of the Securities and Exchange Commision (SEC), accessed by Perfil together with the local branch of the Paradise Papers team.

The official was, between August 2009 and July 2015, the main shareholder in the company Princess International Group, based on the Cayman Islands. He held over 75 percent of the shares, but Caputo failed to add that information in the affidavits filed before the OA Anti-Corruption Office when he took public office in December 2015, when he should communicate his assets and shares for the 2014 fiscal period. He also concealed that information again in 2016, when he should have informed his assets as of early 2015. 

His involvement in Princess International Group was key and evidenced the mechanism whereby tax havens facilitate the concealment of assets, information and money. Through this company, Caputo was the owner of between 50 and 74 percent of another offshore company: Affinis Partners II, also based on the Cayman Islands and owner of Noctua, the manager of investment funds based in Delaware and Miami. 

The corporate structure of Noctua works like Russian dolls: one company owns another company which is the parent company of another.

 

– TIMES/PERFIL
 

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