(Recasts with focus on tax amnesty revenue; adds estimated
financing needs, quotes from Dujovne and Caputo, background on
By Luc Cohen and Nicolás Misculin
BUENOS AIRES Dec 30 Incoming Treasury Minister
Nicolas Dujovne said on Friday he would aim to cut Argentina's
expected budget deficit for 2017, currently seen at 4.2 percent
of GDP, with revenue from a tax amnesty program and an eye
toward lower spending.
In his first public comments since his appointment, Dujovne
told a press conference that his main objective would be to
continue with center-right President Mauricio Macri's economic
Argentina remains in recession one year after Macri came to
power and implemented market-friendly reforms, including letting
the peso float and slashing grains export taxes.
But inflation, seen ending the year at 40 percent, has
curtailed consumers' purchasing power and a promised flurry of
foreign investment has failed to materialize.
On Monday, Macri fired current Finance Minister Alfonso
Prat-Gay, citing differences over management style, and split
the ministry into two - a treasury division to be led by
Dujovne, former chief economist at Argentine bank Banco Galicia,
and a finance division, to be led by current Finance Secretary
Both are expected to take office next week.
Caputo said on Friday the administration was considering
tapping debt markets in January, citing the recommendation of
banks. He added that Argentina needs $22 billion of debt
financing for 2017, plus an additional $21 billion of
"There is no problem with the sustainability of the debt,"
Dujovne is viewed as more of a fiscal hawk than Prat-Gay,
whose 2017 budget project included the 4.2 percent deficit
target, higher than the 3.3 percent initially proposed.
Macri's deficit-reduction hopes are complimented by an
expected increase in public works spending to drive economic
growth ahead of legislative elections in October.
"I want to spend much more efficiently," Dujovne said,
adding that he would aim to reform the country's tax code to
lower taxes, while shrinking the deficit and boosting
infrastructure spending. "Now, we're going to try to look very
closely at how we're spending."
He did not give a new deficit target, saying that would
depend on how much revenue the government received from a tax
amnesty that allows Argentines to pay a fee to declare hidden
assets without fear of prosecution for tax evasion.
Argentines have declared $90 billion so far, resulting in
government revenue of 82 billion pesos ($5.17 billion), and can
continue declaring through the end of March.
($1 = 15.8500 Argentine pesos)
(Additional reporting by Maximilian Heath; Editing by Phil
Berlowitz and Dan Grebler)