Until the middle of the year, the deficit of the National Public Sector – not counting debt payments – was 0.5%. The “silver plan” of the elections exacerbated the problem.
In October, the National Public Sector registered a primary deficit of $ 209,169 million and a financial deficit of $ 277,094 million. Thus, as of October, a primary deficit of $ 776,645 million (1.8% of GDP) and a financial deficit of $ 1,337,799 million (3.1% of GDP) accumulated, after excluding extraordinary income corresponding to SDR.
Until the middle of the year, the primary deficit in terms of GDP (the difference between what is collected and what is spent, without accounting for debt) was 0.5%, which evidenced the “adjustment” that since then has almost quadrupled.
It was for seasonal reasons, but fundamentally because of the “platita” plan for the elections, after Cristina Fernández’s letter questioning Martín Guzmán after the result of the primaries. But even so, the minister is two points below the budgeted guideline, when two months of the year have yet to be counted.
It should be remembered that the National Public Sector registered in 2019 a primary deficit -without extraordinary income- of $ 208,766.7 (-0.96% of GDP), while the financial deficit stood at – $ 933,052.0 (- 4.28% of GDP).
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In the first year of Alberto Fernández’s administration, the National Public Sector closed the year with a primary deficit of $ 1,749,957 million (6.5% of GDP) and a financial deficit of $ 2,292,830 million (8.5% of the GDP). The pandemic influenced with lower resources by -0.7% of GDP and expenses equivalent to 3.5% of GDP. That means there was a 3% primary deficit not attributable to the coronavirus.
The evolution of the deficit is decisive for the negotiations with the IMF. The body proposes for 2022 a primary fiscal red that does not exceed 2.5%, to reach 0 in three years. Guzmán’s roadmap proposes 3.3% and equilibrium in 2028. In the Fund -among the disagreements that persist- they ask how the difference would be financed.
67.6% grew tax revenues in 10 months
Those associated with economic activity, such as VAT net of refunds, rose 52.3% year-on-year.
83% increased expenses in the SPN
“The figure rises to 96.9% yoy after excluding extraordinary expenses associated with COVID-19 in 2020 and 2021,” reported Economía.
20.3% real raise
According to the economist Nadin Argañaraz, public spending for October is 20.3% higher than that of the same month of 2020 in real terms. The specialist from the Argentine Institute of Fiscal Analysis highlighted that the Guzmán administration had been alternating “adjustments” and rises until the prelude to the primary and general elections. The fiscal red will get worse when the November accounts arrive.
This is how Roberto Cachanosky described the expenditures on energy and transportation. “In October the government spent $ 157,000 million in economic subsidies to keep the rates of public services behind. That is equivalent to 17.7% of current spending and 53% of retirements and pensions paid in October ”, he stated.