Don't cry for us, learn from us, Argentina tells Davos
Davos - “I invite them to visit Argentina and see what happens with an incredible country that adopted protectionism and isolation as a way of life,” Macri said in an interview with Reuters on Thursday.
“It didn’t work. We only deepened our poverty problems.”
The rising threat of global trade wars is a major theme of talks at the World Economic Forum in the Swiss town of Davos. Policymakers and economists are bristling over U.S. President Donald Trump’s protectionist agenda.
Trump is due to speak to the forum on Friday.
When Macri was elected in 2015, he took over a country that was on a path to financial ruin after a decade of free-spending populist policies.
Argentina's President Mauricio Macri gestures as he speaks during the World Economic Forum (WEF) annual meeting in Davos, Switzerland January 25, 2018. REUTERS/Denis Balibouse
After the country’s 2001 default, Argentina was frozen out of global capital markets for years. Former President Cristina Fernandez implemented currency controls, erected import barriers to protect domestic industry, and printed money to cover a widening fiscal deficit during her two terms from 2007-2015.
The measures boosted certain sectors of the economy and financed an expansion of social programs for the poor, but generated a decline in central bank reserves and one of the world’s highest inflation rates.
Argentina's President Mauricio Macri addresses a speech during the World Economic Forum (WEF) annual meeting in Davos, Switzerland January 25, 2018. REUTERS/Denis Balibouse
Macri has unwound currency controls, slashed taxes on key grains exports, reduced import restrictions and overhauled the tax and pension systems.
The measures have contributed to a dramatic decline in yields on Argentina’s debt and a surging stock market. But Macri has struggled to slow double-digit inflation and convince companies the country is safe for long-term investment.
Macri said his administration aimed to reach single-digit inflation by the end of 2019. He said his country was keen on multilateral and bilateral trade agreements as it sought to restore confidence in its future.
“We have been so isolated that we have only room to improve and to create better and long-term relationships,” said Macri.
“We want to be part of global solutions, not global problems.”
Reporting By Alessandra Galloni