Big economy news out of Argentina today, as President Mauricio Macri asked for and received the resignation of his Finance Minister, Alfonso Prat-Gay. Macri’s spokesperon, Marcos Peña, trotted out the the official government line that (translated), “The President asked for his resignation. It’s a question of political differences. It’s not about the (upcoming) mid-term elections, but about a vision of how to organize the work inside the ministerial government“, which is basically a large mouthful of nothing-speak.
What’s clear is that Macri is now worried about the 2017 mid-term vote, because if that goes against his political line his government becomes very lame duck very quickly. The economic benefits he has promised Argentina after they’ve suffered through his austerity plan are not appearing and citizenry patience is wearing thin. All this means that Prat-Gay, as orthodox an economist as you could imagine, has taken the fall and we’re likely to see Macri switch to a nearer-term, more populist stance in order to bring quick benefits to the country…in order to save his own hide.
UPDATE: Top Argentina political blogger Abel adds his dos centavitos: Excerpt:
“…that the exit of Prat-Gay was inevitable due to the friction caused by the recession, the rate of inflation, the exchange rate lag, the frustration of a economic policy that isn’t showing the results that were expected.”