economy and politics

Cristina Fernández pushes herself within the political scene; Alberto Fernandez weakened

Cristina Fernández pushes herself within the political scene;  Alberto Fernandez weakened

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Silvina Bakatis was sworn in this Monday as the new Minister of Economy after the resignation of Martín Guzmán. The economist arrives in a context of economic and political crisis in the country. After more than a month without meetings in person, the president, Alberto Fernández, and the vice president, Cristina Fernández de Kirchner, finally met this Monday. The president, weakened, gave in to the ex-president who he could appoint as head of the Economy portfolio.

Silvina Bakatis was named Argentina’s new economy minister on Sunday, following the resignation of Martin Guzman. She was sworn in this Monday in a sensitive economic context, since the markets had reacted very negatively to the resignation of the now former minister.

This Tuesday, Argentine stocks recorded falls of 5%, while sovereign bonds sank 10%, with a risk index of 2,587 basis points, a level not seen since June 2020, when Argentina had not yet managed to restructure your debt.

Guzmán, who was backed by the president, resigned on Saturday due to a lack of political support for his plan to lower the fiscal deficit and control inflation. It is a new blow for the president, who has already suffered the departure of other officials of his close confidence, such as that of the Minister of Productive Development, Matías Kulfas.

Silvina Batakis, supported by Kirchner, is a former Minister of Economy of the province of Buenos Aires and held the position of Provinces in the Ministry of the Interior. Her appointment, with the support of the former president, suggests an advance in Kirchner’s influence in government affairs.

Batakis explained that he will work on the continuity of the economic program of the Fernández government, which was particularly defined by the agreement that the former economy minister negotiated with the IMF to refinance the country’s 45 billion dollar debt. A key point of the agreement was the search for a fiscal balance, an aspect that the former president repeatedly criticized, but that the new minister said she wanted to consecrate.

Tension between Fernández and Kirchner

In the 2019 presidential elections, Cristina Fernández de Kirchner, with high levels of rejection in some sectors of society, although widely supported in others, presented herself as vice president of Alberto Fernández, which for many was a way to remain in power. in the shadow.

However, the unity of the alliance between Fernández and Kirchner weakened at the end of 2020, with the former president publicly criticizing the government. Last year, Peronism had its worst results in the legislative elections and the tension between the two politicians grew.

Kirchner always disagreed with the agreement between the Government and the IMF and strongly criticized the economic policy of former Minister Guzmán, until he resigned due to lack of support.

In recent weeks, the tension between Kirchner and Fernández grew so much that they stopped meeting in person, until the president called her last Sunday after Guzmán resigned.

For Rosando Fraga, political analyst and historian, “the political defeat of the president is clear with the departure of Guzmán and the arrival of Batakis”, with long experience in public administration and more akin to the populist policies of Kirchnerism. “The vice president does not govern, but she has increasing influence in power,” she added.

An economic crisis that lasts

Batakis will have to deal with high inflation in Argentina, which accelerated to 60.7% year-on-year last May, further undermining the purchasing power of Argentines. In March, food prices rose 7.2%, water and electricity 7.7%, and clothing prices 10.9%.

The war in Ukraine is one of the factors that can explain this inflation, but it is not the only one responsible. The social situation in the country had already been considerably aggravated by the Covid-19 pandemic. In addition, the country has not yet been able to recover from the great economic crisis of 2001.

More than a third of the population lives below the poverty line and Argentina lives to the rhythm of debt payments, which are accompanied by austerity measures. Former President Mauricio Macri had already requested a loan of more than 45,000 million from the IMF, the largest in the organization’s history.

“The high levels of inflation, the fall in international reserves, the increase in the debt in pesos and the need to reduce the fiscal deficit to meet the objectives agreed with the IMF represent great challenges that the new minister will have to face,” he said. Moody’s principal analyst for Argentina, Gabriel Torres.

The meeting between Fernández and Kirchner marked a fragile reconciliation between the two camps, which will need to work hand in hand to face all these challenges and the growing discontent of the population.

With EFE, AP and international media

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