In recent years, fiscal sustainability and state reforms have been the focus of much 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 different branches of government. State reform, on the other hand, aims to remove obstacles and regulations that hinder economic functioning.
In Argentina, achieving fiscal sustainability depends on strong support from the President for fiscal measures and deficit elimination. However, Congressional approval and economic recovery are necessary to improve the quality of fiscal adjustment. Restoring the Income Tax will help 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 the capital markets. To regain trust, successful policies that lead 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 will depend 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 all branches of government while state reforms aim to remove obstacles that hinder economic functioning. The success of these initiatives depends on successful policies that lead to economic growth and stability, as well as accessing international capital markets and adopting a flexible exchange rate regime if needed.
To achieve this goal in Argentina, Congressional approval is necessary along with an improvement in its quality through fiscal adjustment measures such as restoring Income Taxes.
Moreover, successful policies should aim at improving its credibility in capital markets by avoiding past reversals while building reserves to reduce country risk.
Finally, exiting stock markets or adopting a flexible exchange rate regime could further support economic recovery and growth.