Javier Milei published a column explaining the importance of the agreement with the IMF

President Javier Milei explained in a column published in La Nación the foundations of his economic policy and the key role of the agreement with the International Monetary Fund (IMF) to restore the assets of the Central Bank of the Argentine Republic (BCRA).

The president reaffirmed that inflation is a monetary phenomenon resulting from the excess of issuance, exacerbated by the policies of previous governments that plundered the country's reserves.

Milei asserted that inflation is due to an excess supply of money, which decreases its purchasing power and raises prices.

Additionally, he stated that monetary policy operates with a lag of between 18 and 24 months, so the impact of current decisions will be seen over time. He also highlighted that the asset deterioration of the Central Bank has been a key factor in the sustained rise in prices.

"To end inflation, it is not enough to work on flows; it is essential to restore the balance of stocks (BCRA's assets)," explained the president.

The politicians' plunder

In his column, Milei denounced what he called a "colossal scam" carried out by previous governments through the Central Bank. Among the examples he mentioned are:

• The asymmetric pesification of 2001, which meant the loss of 30 billion dollars adjusted to current inflation.
• The Bicentennial Fund, promoted by the convicted for corruption, Cristina Kirchner, which withdrew USD 10 billion at the time, equivalent to USD 15 billion today.
• The sale of futures dollar in 2015, which cost USD 25 billion.
• The SIRA of 2023, which represented a loss of USD 40 billion.

Adding these figures, Milei stated that "in the last 25 years, politics, through the BCRA, has stolen US$110 billion from Argentines."

Milei's plan

Since taking office, Milei claims to have worked on two simultaneous lines:

Cutting monetary issuance: He eliminated the fiscal deficit and quasi-fiscal deficit, achieving that the monetary base remains constant since mid-2024.

Regularization of the Central Bank's stocks: He implemented a write-off of USD 45 billion in public securities and reduced consolidated debt by USD 20 billion.

The agreement with the IMF, Milei explained, will allow further cleaning up the BCRA's balance sheet. With the funds received, the Treasury will cancel part of its debt with the Central Bank without increasing the country's gross debt.

"The agreement with the IMF seeks to restore the BCRA's assets, so that inflation becomes just a bad memory of the past," stated the president.

"Nothing will stop us"

Milei replied to potential criticisms by assuring that his strategy doesn't involve raising taxes or perpetuating inflation. "If that were the case, in the need for a greater fiscal result, we will achieve it by cutting spending," he stated.

Finally, he reaffirmed his commitment to eliminate inflation and transform the country: "Nothing will stop us in our task of eradicating inflation and making Argentina great again."