Martin Guzman: Argentine whiz-kid economist and acolyte of Stiglitz

Martin Guzman: Argentine whiz-kid economist and acolyte of Stiglitz

06/12 - 19:14 - Argentina’s Martin Guzman, a whiz-kid economist with close ties to influential U.S. economist Joseph Stiglitz, will bring a sharp academic intellect but little policy-making experience to the daunting task of reviving Latin America’s third largest economy and averting a damaging default.

Guzman, a debt specialist at Columbia who has a doctorate from Brown University, was confirmed as economy minister on Friday evening in the new cabinet of President-elect Alberto Fernandez, who takes office on Dec. 10.

Reuters, citing a source with direct knowledge of the matter, had earlier reported Guzman’s new role.

He will need all his training as Argentina braces for fraught negotiations with creditors to restructure around $100 billion in sovereign debt while steering the recession-hit country back to growth and taming inflation.

“He was one of my best students, always very focused on macroeconomics and the study of crisis analysis,” Luis Secco, a renowned Argentine economist who taught Guzman at the National University of La Plata, told Reuters.

“He has the technical qualities to succeed as minister.”

Fernandez, introducing Guzman on Friday said he was “well prepared” for the challenge. “He is someone whom in recent times I have consulted a lot about the problems Argentina has regarding debt,” the president-elect said.

Guzman has worked on a research team and edits a journal with Nobel Prize-winning economist Stiglitz, a former World Bank chief economist who has criticized outgoing President Mauricio Macri’s tight fiscal policies for stalling Argentina’s economy.

Stiglitz is a frequent critic of the International Monetary Fund, which agreed a $57 billion financing deal with Argentina in 2018. Nearly $45 billion has already been disbursed.

Guzman, 37, supports a growth-led model to help Argentina pay off its debts. In a presentation in November he called for Argentina to halt debt servicing until 2022 and for the country to only use further IMF funds for investment, not to pay debt.

“Nobody wants a default. Argentina needs to generate repayment capacity,” he said in a radio interview in October. “If the Argentine economy does not come out of this recessive spiral, it will not be able to pay the debt later.”

The research economist typically spends half the year at Columbia University in New York, and the other half in Buenos Aires, where he teaches an course in macroeconomics and debt.

 

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