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Pynanelli: “We have a bad end, but the worst is yet to come”



Daniela Cortez

Daniela Cortez Buenos Aires, correspondent

Economist Aldo Pignanelli spoke with El Territorio about the economic outlook for the year to begin.
“Recently a senior official at the International Monetary Fund (IMF) asked me if we Argentines knew what would happen. I think that we are ending a very difficult year, but the worst is yet to come, ”said Pinenelli bluntly to begin the interview.
To explain his point of view, the economist said that “during 2019, two fronts will be united, which will not bring good news to the Argentines. On the one hand, at the international level, a strong bid between China and the United States has intensified, and therefore it will be more expensive for us to both buy and sell in these markets, because the struggle of the giants turns to prices. And internally we will live another year of high inflation, which, making the calculation as optimistic as possible, will be about 30%. ”
For some economists, given that this year is nearing 48% of inflation, forecasting inflation of 30% by 2019 means an improvement. However, Pinanelli does not see it like this.
“It’s as if we arrived at a car at a speed of 430 kilometers per hour and slowed to 300 kilometers. We still have a serious risk of hitting a big stick. Because the maximum allowable is 50 kilometers. The same thing happens with inflation. Reducing this from 48% to 30% per year means very little to the pockets of the majority, ”he said.
The economist, who was president of the Central Bank of the Argentine Republic during the presidency of Eduardo Duhalde and who is now in the ranks led by Sergio Massa, said that adjusted in accordance with the intention of the International Monetary Fund, next year we will have at least a 30% devaluation with a green ticket that can reach 50 pesos by the end of 2019. ”
But he immediately warned that "this scenario is in the most promising of all possible points of view, because if the fast-moving exchange rate jumps and international factors begin to play, we may face another unpleasant surprise."

Inflation control

Referring to inflation as one of the problems that most affected the lives of Argentines this year, Pignanelli said that “we should not forget that last year, at the same time, the government of Makri told us that we would have inflation 8 ". %, and we ended 2018 with inflation of more than 48%. "
“In this context, if we look at the most vulnerable segments of the Argentinean population, where the food basket has a big impact, we will see that food inflation has comfortably exceeded 50%, so we insist that the inflation process hit harder. those who have less, "he exclaimed.
He then stressed that “this record level of inflation has put our country on the sad podium of the countries with the highest inflation in the world. Because it surpasses us only Venezuela, and we are fighting for second place with two countries that are at war, such as Sudan and Syria. "
When asked whether the government of Mauricio Macri could control inflation during 2019, Pignanelli confirmed that “this is difficult to achieve because countries that had this type of inflation, such as Chile in the 1980s or Israel, as well as Mexico, managed to overcome it is through political agreements, social and economic. Because when inertia of inflation comes, each sector constantly fights, what is called distribution trading, and then it becomes difficult to get out of this vicious circle, because it is a sale, to She can do it where everyone loses. ”
But, according to Pinanelli, the national government "has neither the will nor the capacity to achieve such a level of comprehensive and comprehensive agreements that would call on all parties to put an end to inflation. I do not see intelligence or the desire to work in this sense from the current government" .
The economist also stressed that “this year ends with inflation above 48% and wages adjusted between 25% and 28%. This means a loss of 20% in relation to inflation. Because the worker has increased his income by 28%, and the cost of living has increased by 48%. You do not need to be very enlightened to understand why people do not have enough money. Because inflation devours everything. ”

“The government still lies to us”

After consulting with other views of economists, who believe that 2019 will be the year of the country's economic recovery, Pinanelli responded sharply.
"These are the same people who said that inflation this year will be 8% and that the dollar will not cost more than 20 dollars." These are the same chants that lead us to the road without going. I have no respect for these gentlemen, because they lie constantly and are also bought by the government. The government, which instead of telling us the truth, continues to lie to us. "
Then he pointed out that "if people want to believe in colored mirrors, let them do it." Then comes the accident at the wall. When I give lectures or on the street, people say to me: “In the end, you and Lavanya were right.” We have been preaching in the desert for three years, saying that we are going the wrong way. Unfortunately, we were right. I understand that it is more motivating to believe that the situation will improve. I have my family here, and I want the country to move forward. But only good intentions do not reach to revive the economy. ”
From the point of view of Pinanelli, “the outcome of the elections of 2019 no longer depends so much on the government, which has very little opportunity for action, but depends on the opposition. It remains to be seen whether the opposition will succeed in presenting a new variant to society, differentiating itself from a crack that so strongly divides. If he succeeds, he has many chances to reach the government. "
“At the moment I give the governors a very important role. For the role that they can perform as supervisors of this difficult case, ”he concluded.


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