May 5th, 2023


1. Alberto Fernandez traveled to Brazil to meet with President Lula da Silva

On May 2, President Alberto Fernandez met with his Brazilian counterpart, Luiz Inácio Lula da Silva. Together with members of his cabinet, including the Minister of Economy, Sergio Massa, they analyzed alternatives to provide financial assistance to Argentina in the context of scarce reserves. A mechanism to boost bilateral trade similar to the currency swap agreements with China was explored. The scheme would allow Argentinian importing companies to pay for purchases from Brazilian companies in pesos, which the Brazilian government would convert into reais. The mechanism would bypass the use the dollar, easing pressure on reserves at a time when Argentina’s Central Bank has scarce foreign currency for immediate use, while maintaining the flow of bilateral trade between the two main Mercosur partners. The possibility of establishing a common currency for Mercosur has been discussed in the past, but for this to happen Argentina must solve its macroeconomic problems.

Ámbito Financiero: Importaciones: avanza acuerdo con Brasil por sistema de crédito con SIRA en reales  
Ámbito Económico: Argentina-Brasil: de qué se trata el nuevo acuerdo bilateral que excluirá al dólar 

2. Negotiations with the IMF to relax reserve accumulation targets

The new director of the International Monetary Fund (IMF) for the Americas region, former Chilean Finance Minister Rodrigo Valdés, took office on May 1 and will formally begin reviewing the renegotiation of Argentina’s program. The official began his duties while a delegation from Argentina’s Ministry of Economy was in Washington, D.C., negotiating to make the agreement more flexible in light of the review that concludes this month. The first quarter targets, both fiscal and reserve accumulation, were affected by the drought that hit Argentina. In this context, the delegation will also seek earlier disbursements from the Fund. United States officials are reportedly in favor of advancing the US$10.6 billion payment that Argentina should receive between June and December to the middle of the year. The U.S. is the largest shareholder in the IMF.

El Cronista: Negociación con el FMI: test y nuevas caras en la discusión por las metas y giros
Télam: El Gobierno de EEUU apoyaría que el FMI acelere los desembolsos pendientes para la Argentina

3. A draft bill to reduce the working day was proposed

With Workers’ Day as a kick-off, Senator Mariano Recalde presented a package of measures to “introduce improvements in the labor world.” Among the measures is a bill proposing a reduction of the working day from 48 to 36 hours per week, with the objective of promoting a four-day work week. The Senator’s argument is that reducing working hours “increases productivity, reduces business costs and accidents, and allows for a better distribution of employment, as well as a better work-life balance.” For her part, the Minister of Labor, Raquel “Kelly” Olmos, expressed that “It is an urgent issue that deserves to be included in the national debate.” In this way, the Government ratified its support for the unions’ idea of reducing the working day by law, which would imply the creation of new jobs.

El Cronista: La Ministra de Trabajo apoya una reducción de la jornada laboral: “Es un debate urgente”
El Cronista: La Cámpora impulsa una reforma laboral para reducir la jornada: los detalles del proyecto y sus chances

4. Updates on the electoral panorama

The Governor of the Province of Córdoba, Juan Schiaretti, confirmed that he will be a candidate for President in the Primary, Open, Simultaneous and Mandatory (PASO) elections to be held on August 13. The provincial president proclaimed, “I want to confirm that I will be a candidate for President in the next PASO and I will do so for a coalition that represents those who work, the productive interior, and that expresses the overcoming of this damned rift that is hurting us Argentines so much.” The Electoral Board of the Province of Buenos Aires also made official the PASO election schedule this Thursday. It aligns with the national dates for the primary elections, so that on Sunday, August 13, the candidates for Governor and Vice-Governor, provincial legislators, mayors, councilors and school councilors will be named. In turn, eight provincial elections will be held in Argentina during the month of May. On Sunday 7 there will be General Provincial Elections in La Rioja, Misiones and Jujuy; and on Sunday 14 in La Pampa, Salta, San Juan, Tucumán and Tierra del Fuego.

Infobae: Juan Schiaretti confirmó que será candidato a presidente en las elecciones 2023
Infobae: Elecciones 2023: qué provincias restan definir sus fechas de votación

5. INDEC published the Permanent Household Survey data

The National Institute of Statistics and Census (INDEC) published this week the Permanent Household Survey (EPH), corresponding to the second semester of 2022. The report revealed that, with respect to the provision of public services, 9.9% of households do not have access to the running water network; 31.5% do not have access to the natural gas network and 26.7% lack connections to sewage networks. Moreover, 6.5% of households live in dwellings whose materials are of insufficient quality and 12.0% live in dwellings whose materials are of partially insufficient quality. In the case of individuals, these percentages amount to 8.2% and 13.9%, respectively. Regarding the tenure status of the dwelling, 60.9% of households own both the dwelling and the land, while 6.7% of households own only the dwelling and 20.7% of households are renters. The category of occupants includes occupants who pay taxes or expenses, free occupants with permission, and de facto occupants (without permission); together, they represent 9.8% of all households.

INDEC Argentina: Indicadores de condiciones de vida de los hogares en 31 aglomerados urbanos