Monday, December 4, 2023

ECONOMY | 26-09-2023 23:54

Bullrich adviser says dollar, peso will co-exist in Argentina

“The peso and the dollar will coexist” if Patricia Bullrich is elected as president, says Carlos Melconian.

Argentina’s Patricia Bullrich would pursue a currency regime where the peso and dollar exist together as legal tender if she wins the presidency, according to her chief economic adviser Carlos Melconian.

“The peso and the dollar will coexist” if Bullrich is elected, Melconian said Tuesday at the Bloomberg Economic Summit in Buenos Aires. “There will be a complementary exchange rate regime that will be step by step, and will take inflation into account.”

Bullrich, who’s running for the pro-business opposition Juntos por el Cambio coalition, floated Melconian, a celebrity economist in Argentina who leads a local think tank, as her potential Economy Minister last month. It’s an attempt to focus her campaign on topics that are top of mind for voters as inflation surges past 120 percent. The incoming government will need to reign in spending, slash the fiscal deficit and rebuild dwindling Central Bank reserves. 

“There is going to be very severe and prudent macroeconomic policy in Argentina,” Melconian said, adding that Bullrich’s government would aim to cut government spending by four percent of gross domestic product.

“There is no such thing as a 10 or 15 percentage point cut,” he said, referring to the pledges made by frontrunner Javier Milei. “It’s another fantasy,” Melconian added. 

Melconian spoke at the event just ahead of Emilio Ocampo, an economic adviser for Milei, who has vowed to shutter the Central Bank and dollarise the economy.

Milei, who had a surprise strong showing in August primaries, is seen as the leading candidate for the October 22 election. Bullrich’s pro-business coalition received around 28 percent of the vote in the primary vote last month, trailing Milei, who won about 30 percent. 

“We have to end inflation,” Ocampo said at the same event. “It’s impossible to move forward with other reforms without eliminating inflation.”

by Manuela Tobias & Ignacio Olivera Doll, Bloomberg


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