New cabinet in Argentina: the government’s last chance to overcome the crisis?

After several days of rumors, the Argentine government announced on Thursday the appointment of the president of the Chamber of Deputies, lawyer Sergio Massa, to head a new ministry that will cover the economic, productive and agricultural areas, amid serious financial difficulties.
“It seems like the last chance. Massa’s appointment is more of a desperate letter than a reasoned one: several economists had rejected the post (of economy minister) and the government had no other options,” political analyst Andres Malamud told Reuters.
Massa, who must resign his seat in Congress before taking over as minister, said Friday that he will announce on Monday the team that will accompany him and on Wednesday a series of measures.
“First of all, until Monday I’m not going to start either appointing or running officials,” Massa said as he left a meeting with President Alberto Fernandez at the official residence.
“Secondly, on Wednesday we are going to announce a set of measures because the assumption will be only on Tuesday, after the (legislative) assembly,” he added.
The climate was one of expectation on Friday as the new cabinet takes, as Latin America’s third-largest economy faces a challenging economic outlook with an exorbitant inflation rate, fiscal deficit and a currency at historic lows against the dollar.
“The government needs to reduce the fiscal deficit and recreate expectations. Massa buys time, it remains to be seen whether he executes the necessary policies,” Malamud said.
With the change, the government aims to bring tranquility to the financial markets, which on Friday reacted positively, with the stock market trading higher due to speculative positions pending announcements.
“It seems to me that Massa and his ‘skills’ can contain the situation of overflowing on the street a little longer. That is, calm the financial, calm the street a little and thus reach 2023. That’s a long way from solving people’s problems,” political analyst Jorge Giaccobe told Reuters.
“It does not seem to me that this can be considered a maneuver to overcome the crisis but so that the situation does not decompose anymore. It’s one thing to fix a problem and it’s another thing not to make it worse,” he added.
The ruling center-left coalition, composed mostly of Peronists, seeks to improve its deteriorating public image to have a chance in the 2023 elections. If successful, Massa will have a chance to be a presidential candidate.

The announcement involved the departure of Silvina Batakis from the Ministry of Economy after being less than a month in office and having this week her first meeting in Washington with authorities of the International Monetary Fund, with which the country has a debt of 44,000 million dollars. The official will be in charge of the state-owned Banco Nación.

All eyes are now on the next steps the government will take.
“A key aspect to keep in mind in the coming days will be who advises Massa, because he is a politician and a lawyer, so he will have to assemble a good team to navigate the complicated situation in the country,” said Carlos de Sousa, of asset manager Vontobel, who owns some bonds from Argentina.
“The market will likely want to see his concrete plans before bond prices return to pre-Guzman resignation levels.”
Fernández went to his Twitter account to support the new “superminister”, of whom he highlighted his “vision, capacity and experience”.
Massa “can make a big change and make history with a reform plan. However, in Argentina there are two types of equilibrium: the political and the economic. What suits the ruling class and economic logic. Everything will depend on what ends up prevailing,” concluded economist Natalia Motyl.

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Original source in Spanish