Minister of the Provincial Government of Buenos Aires, carlos biancolaunched a harsh critique of the president’s economic model. Javier Millay.
“Bishop” of management Axel Kisilov He warned of the decline in purchasing power of Argentine families, saying: “People can’t make ends meet and end up going into debt to buy food.”.
The warning was issued within the framework of the presentation of data on the state’s economic situation, which the Buenos Aires administration said showed an alarming situation in terms of employment, consumption and industrial activity.
The weight of the recession in the Buenos Aires region
The president of Provincia Bank also accompanied. Juan CuattromoDirector of ARBA, Christian GirardBianco explained that the recession has had a “very strong” impact on the region, where around 40% of Argentina’s population and half of Argentina’s industrial network are concentrated.
“Industry is one of the sectors most affected by current economic policies, with the province of Buenos Aires accounting for approximately 50% of the country’s industrial production.. The numbers we are collecting show a sustained contraction in production, consumption and workers’ incomes,” the minister explained.
According to data from indexIndustrial activity fell by 13.7% year-on-year in the first eight months of 2024, while mass consumption recorded a significant decline over the same period. The province of Buenos Aires is particularly susceptible to these indicators due to its special weight in the national production matrix.
Municipal bonds and funds for municipalities
In his presentation, Bianco mentioned the need for states to access “additional resources” through “financing instruments” in connection with state debt projects that are subject to legal treatment.
Officials confirmed that the Buenos Aires executive authorities have sent a proposal to the legislature to consider the allocation of the budget. Contributing a “proportion of anticipated debt” to the creation of a designated fund to support 135 municipalities in the statemany of whom face financial difficulties in maintaining basic services.
“The state needs this debt to shore up its finances, from which it can allocate a portion to municipalities, as contemplated in the project. If a fixed fund is created without linking it to new sources, those funds will have to come from state levies, which will further complicate the situation,” Bianco argued.
This debt project is intended to at least partially compensate for the decline in state collections and reductions in national transfers that affect both state and local governments.
Joint participation and transfer: claims against the state
One of the central points of the Minister’s proposals was to distinguish this economic crisis from previous periods. Bianco stressed that the current scenario is worsened by “reduced cooperation participation of the federal government” and “transfer reductions of more than P13 billion” by the national government.
In Argentina, the debate over federal joint participation is historic and intensified in 2024. Buenos Aires province demands greater participation in national tax allocationclaims to receive a smaller share in relation to their contribution to the country’s GDP and number of inhabitants.
“The current crisis is unique in that it involves relocation adjustments from the government.. That’s why we argue that state governments can create funds for local governments, as long as they have access to additional financing. That is our proposal and we are now in the legislative negotiation stage,” the minister said.
State strategies in the face of crisis
Bianco ended his intervention by endorsing the Kisilov government’s commitment to “cooperate with workers, the productive sector and local authorities” to prevent the economic situation from leading to “social despair”.
This senior official’s position is part of Xilofism’s political strategy to differentiate itself from state management by acting as a containment dam against the effects of the economic adjustments implemented from December 2023.
Tensions between the national and provincial governments are expected to continue in the coming months, especially if economic and social indicators do not indicate a sustained recovery that will alleviate pressure on the most vulnerable sectors of Buenos Aires’ population.
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