Dujovne. Photo via La Voz

Newly appointed Treasury Minister, Nicolás Dujovne, sat down with some of the largest media outlets in the country this week to talk about the year’s most pressing economic challenges. From increases in utility bills and transportation fares to lowering the fiscal deficit and increasing tax revenue, Dujovne outlined the policies he plans on implementing throughout the year noting that the government needs to deliver some good news on the economic front if it wants to do well in October’s mid terms.

These are the five most important highlights from his interviews:

On Lowering The Fiscal Deficit

“Our goal is to abide by this year’s budget. And the level of public spending is outlined there. We took office with a budget that has already been voted on by Congress. Within the Secretariat of Economic Policy we will have a world-class economist, Sebastián Galiani, who will help us define what our priorities will be in terms of efficiency. We will analyze how national and provincial administrations spend their money in order to operate within margins. The numbers have to be believable, but if we want that to happen we need to offer a coherent explanation on why they will be like that.”

“But beyond numbers, today we know how we are going to work towards them. First, tri-annual goals that reach consensus among all ministries. Second, create institutional mechanisms such as a fiscal responsibility law for provinces and the national government. We have time to work on this throughout the year and eventually present it as part of 2018’s budget bill. The fiscal responsibility law must include clear goals, [and outline] behavior for public spending in relation to GDP and inflation. We will be careful about public spending from the beginning.”

On Increasing Utility Bills, Transportation Fares And Allowing Oil Prices To Increase In The Days To Come

“What lies ahead is much less traumatic than what happened in 2016. When it comes to transportation fares, we will be focused on making sure the increases are as gradual as possible, because of the impact they have on the most vulnerable sectors of society. Last year was painful for Argentine families, but at the same time everything was done to lay the groundwork and have the economy grow again.”

On oil: “We have clashing goals: lowering inflation, looking after people’s pockets and lowering subsidies. In that delicate balance, oil prices increased much less than the rate of inflation. There’s a gap that is being corrected. It’s a necessary adjustment.”

On How The Economy Is Slowly Starting To Grow

“In October, the Economic Activity’s monthly estimate didn’t drop compared to the previous month… Exports — in terms of quantity grew 19 percent this year and industrial exports grew for the fourth consecutive month, something that didn’t happen for four years. Sales of cement, cars and consumption goods increased when compared to the last year. Sales of oil and iron are much higher than the first semester’s. Our GDP will grow in the fourth quarter, compared to the third [quarter]. Multi-year comparisons, however, will continue to show a decrease in their numbers.”

“36,000 jobs were created between August and October, when there was an important hit in employment between February and July. Real salaries have been increasing since August and a significant expansion was registered during November. The economy has stopped dropping, clearly. Of course, numbers are modest so far and we intend to have employment grow more quickly.”

On Implementing Tax Reform

“It is too soon to tell what we will do in that department, give me a little time. My focus is on levels of informality within the Argentine economy. 35 percent of [the economy] is informal, mainly because there are some sectors that can’t handle the tax burden. Labor taxes are ridiculous.”

On The Decision To Stop Reimbursing IVA Tax On Purchases Lower Than AR $1,000 Made With Debit Cards

The measure had a high fiscal cost and didn’t fulfill its purpose of discouraging cash purchases. It benefited a single sector of society that didn’t need it. And we have to consider retirees who collect minimum pensions, [along with] Universal Child Allowance (AUH) and Pregnancy Allowance recipients, who will still have the IVA tax deducted from their purchases made with debit cards until December 31st. That’s our goal. To reimburse the IVA tax to those who need it the most.”