December 20, 2019
1. Bill establishing social solidarity and the reactivation of the productive sector given preliminary approval.
This morning, the Chamber of Deputies gave preliminary approval to 84 acts which grant the executive branch additional powers, including the modification of taxes to increase revenue and control losses on the part of the Argentine peso. According to Economy Minister Martín Guzmán, this bill is the “first step towards resolving the social and economic crisis” in Argentina and stated that it is a “set of measures that hope to maintain an equilibrium” and prevent the economy from dropping further. The Senate will work on the initiative nonstop, with the goal of sanctioning the project. In the upper house, the Frente de Todos required the support of 2/3 of the present senators to enable the initiative to be debated (this occurred because the project was not discussed in Senate committees).
2. Fernández reaches agreement with governors to extend fiscal pact
President Alberto Fernández met with governors at the presidential offices at the Casa Rosada and signed an extension of the fiscal pact that was signed in November 2017 with Mauricio Macri, which will halt the drop in gross income and taxes. In this line, the agreement anticipates the creation of a committee to evaluate the impact a reduction in value-added tax and income tax on basic household items could have on these goods, and proposes policies that will facilitate an integral, rather than judicial, solution valid through December 31st, 2020. With this measure, the federal government hopes to generate ARS $60 billion (USD $1 billion) in savings for the 23 provinces and the city of Buenos Aires. Other primary points of the text agreed to include the one-year suspension of the lawsuits against the state, which brought additional problems to the final months of the Macri administration.
3. Government to meet with companies operating in Vaca Muerta
Neuquén Governor Omar Gutiérrez joined Development Minister Matías Kulfas for a meeting in Buenos Aires with representatives of the oil and gas industry to evaluate the current situation and the status of investments into the non-conventional development of gas and petroleum in the Vaca Muerta shale formation. President of state-owned oil company YPF, Guillermo Nielsen, stated the government is working to find ways for the energy sector as a whole to avoid the high cost of obtaining financing in the country during a meeting in Washington D.C. last Tuesday. On the legislative front, the Social Solidarity and Production Reactivation bill currently under debate in Congress establishes a reduction in export taxes for oil and gas and mining with a ceiling of 8%.
4. Fernández explains latest policies and met with the business sector
President Alberto Fernández provided an exclusive interview on Monday, where he explained a series of announcements that shed light on concerns over Argentina’s economic stability. “[My administration] found itself in a precarious financial situation, high levels of poverty […] It’s a deteriorated economy with a marked drop in consumption,” Fernández stated. Moreover, he discussed the Social Solidarity and Production Reactivation bill, confirming that the bill will attempt to help those most vulnerable through the promotion of domestic industry, development and production. Regarding withholding taxes, he again referenced the country’s economic situation and that it these taxes are not intended to punish rural economies. Additionally, the president hosted a lunch with some of Argentina’s most influential business leaders and asked them to make an effort to help repair the country’s economy.
Telefe Noticias: Entrevista exclusiva a Alberto Fernández
5. Government presents nutrition cards
The government announced the distribution of “nutrition cards” for those who receive funds from the universal child allowance. The program allows beneficiaries to receive a card with ARS $4,000 (USD $67) in value to buy nutritional items, excluding alcoholic beverages. The policy was enacted with recent data from the Argentine statistical agency (INDEC) in mind that revealed a family of four needs ARS $37,596 (USD $629) to not fall into poverty and ARS $15,099 (USD $253) to avoid homelessness.