Argentina’s Path to Fiscal Sustainability: Balancing Political Support with State Reform and Economic Growth

State reforms and fiscal sustainability are crucial topics of discussion. Fiscal sustainability refers to maintaining a certain trajectory over time, but it can also be political in nature depending on the level of support from various government branches. On the other hand, state reform aims to eliminate obstacles and regulations that hinder economic functioning.

In Argentina, achieving fiscal sustainability requires strong support from the President for fiscal measures and deficit elimination. The future challenge is to improve the quality of fiscal adjustment through Congressional approval and economic recovery. Restoring the Income Tax will make fiscal adjustment more equitable and improve its quality.

The concept of fiscal sustainability raises questions about the reversibility of measures, as past reversals have contributed to Argentina’s lack of credibility in capital markets. To regain trust, successful policies leading to economic growth and stability are necessary.

The pension system in Argentina is undergoing changes, with room for further reform in the future. Accessing international capital markets by 2025 depends on successful economic policies and a positive relationship with the IMF. Additional funding from the IMF should not be used for exchange rate interventions but rather to build reserves and reduce country risk.

Despite recent market uncertainties, the Federal Reserve’s monetary policy stance remains unchanged. Economic recovery in the US is stable, which bodes well for emerging markets like Argentina. Exiting stock markets and adopting a flexible exchange rate regime could further support economic recovery and growth.

In conclusion, achieving fiscal sustainability requires strong support from various government branches, while state reform aims to remove obstacles hindering economic functioning. In order to regain trust in capital markets, successful policies leading to economic growth and stability are necessary.

Accessing international capital markets by 2025 depends on successful economic policies and a positive relationship with the IMF. However, additional funding from the IMF should not be used for exchange rate interventions but rather to build reserves and reduce country risk.

Exiting stock markets and adopting a flexible exchange rate regime could further support economic recovery and growth.

Overall, achieving fiscal sustainability is critical for long-term success in any economy, as it helps maintain financial stability