Argentina to expand export incentive program beyond soybeans

Argentina announced on Monday it would expand and extend an export incentive program for a month starting on Tuesday, after Economy Minister Sergio Massa emerged as the surprise frontrunner in the presidential election.

The program, which had once been available to exporters of soybeans and their derivatives, will now be offered to all export sectors, in a bid to boost exports and bring in hard currency to replenish the central bank’s meager reserves.

The measure would go into effect on Tuesday and Argentine agro-export firms will be able to swap 30% of the foreign currency they make on alternative exchange markets that offer better rates than the official rate, Massa said at a press conference with foreign journalists.

Argentina’s international sovereign bonds fell and its stock market tumbled on Monday after the center-left Massa finished first in Sunday’s vote and earned a spot in next month’s run-off election.

Massa, who took over as economy chief a little over a year ago, has overseen Argentina’s worst economic crisis in two decades, with annual inflation hitting 138% in September.

The Peronist economy chief also told reporters that he will promote a change in the 2024 budget to include a primary fiscal surplus projection of 1% of GDP instead of the previously planned deficit of 0.9% of GDP.

The surplus will result from “cuts in budgetary and tax benefits that Congress has been sanctioning year after year,” the minister said.

Massa earned some 37% of Sunday’s vote, ahead of libertarian Javier Milei, who received 30%, a surprise reversal of pre-election expectations.

Massa and Milei will now compete to woo nearly 9 million swing voters before the run-off election scheduled for Nov. 19.

Tags: export, Argentina