Argentina’s economy minister resigns after being criticized for economic mismanagement

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Argentine Economy Minister Martin Guzman announced his resignation on Saturday (July 2), creating more uncertainty in the region’s third-largest economy. Guzman led the renegotiations with the International Monetary Fund (IMF). The former minister gave no reason for his resignation in his statement to President Alberto Fernandez, but urged the leader to resolve internal disputes so that “the next minister does not suffer” from the problems he faced in his job. message on Twitter. The 39-year-old minister’s job was to renegotiate a $44 billion debt with the IMF that the country was holding but could not afford. However, the initial loan issued was for $57 billion, the largest ever issued by the organization but was turned down by Fernandez after taking over from his predecessor who had requested the loan, AFP reported.

This resignation comes after being criticized by the former president and current vice-president Cristina Kirchner who gave a speech attacking the government for its economic management. Guzman was able to reach an agreement and prevent the country from defaulting despite Kirchner’s resistance.

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Guzman said whoever succeeds him will have to “centrally manage the macroeconomic policy instruments necessary to consolidate the progress made and face the challenges ahead”, AFP reported.

Argentina, a major agricultural country, has been dealing with economic crisis for years, with inflation over 60% in the past year. The agreement with the IMF included clauses aimed at controlling inflation and bringing the budget deficit from 3% in 2021 to parity by 2025.

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The country was already struggling but the Covid pandemic made matters worse with rising unemployment. The president admitted earlier this week that the country was facing “a growing pains” due to the lack of foreign exchange.

According to political expert Carlos Fara in a conversation with AFP, “the resignation will have a very bad effect on the markets. Even if the president and the vice president reach a consensus on the management of the economy, everything will now be conditioned by the pressure of Cristina Kirchner.”

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In a recent report by the Eurasia Group, it was stated that according to the analysis of the past few years, the internal conflicts will not be resolved any time soon. The group said: “Infighting within the administration will continue to escalate, further damaging the administration’s ability to craft a cohesive policy plan.”

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(with agency contributions)


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