Matthieu Pigasse: “The role of the IMF in Argentina is to avoid a possible contagion effect”

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Those who know him well, who are few, define Matthieu Pigasse as an exquisite billionaire. In his fleeting visit to Argentina, last Tuesday, when he met with Mauricio Macri, Minister Dujovne and the deputy of the central Gustavo Cañonero in his role as CEO of Lazard Bank of France; Pigasse slipped that is socialist and also does not own car or home. At age 50, he was chief of staff of Dominique Strauss Kahn and later of his successor as French Economy Minister, Laurent Fabius. But their real specialty is debt restructurings. He worked in countries as diverse as Iraq and Ecuador, helped resolve the dramatic Greek crisis and intervened in the most recent of Ukraine. Clarín interviewed him after his meeting with Macri.

-What motivated your meeting with the Government?

-We came because when the increase in US interest rates occurs. and manifested in the currency crisis in Argentina, Carlos Winograd, Argentine economist and Daniel Cohen, French economist, both professors of the Paris School of Economics, held a series of meetings to explain to President Macron’s economic team the situation in the country, and in other emerging markets. These meetings became regular and the French government greatly appreciates having this exchange, which crystallized in a strong support for Argentina’s government program in all international instances. We are in weekly contact and we facilitate communication between President Macron and the government of Argentina. From there with Carlos and Daniel, we thought how we can help, and just a few days ago we proposed a trip to Buenos Aires and the Argentine president answered us in less than 24 hours waiting for us.

– What is the help?

-To help a transition that moderates the effects of the crisis. For example, in the subject of tariffs, balance is taken care of and long-term consideration is given to infrastructure development.

– In your opinion, did the government handle the crisis well?

– I found it with the management of the situation, understanding exactly what is happening and with the full command of the situation. I am very impressed with the energy, vision and strategy that you are following. I saw them committed and worried.

– What concern transmitted?

-The President is concerned with the social impact of the crisis and considers all means to mitigate the negative effects of the current adverse situation. It has conveyed to us that it seeks to find the right balance in the decisions to rebuild the macroeconomic balances that allow growth to be promoted, and to protect the lower income sectors.

Do you think the situation was mastered?

-The situation is not easy. The first thing to understand is that it is not a specific crisis in Argentina. There is a storm that affects emerging markets globally. Argentina has some particularities due to the drought and the fall of its agricultural production, but this is a global crisis that hits Brazil, Mexico, Turkey and South Africa and that is explained by the combination of the increase in fuel prices and the rise in the US interest rate This produces a global recomposition of financial portfolios.

-How do you evaluate the decision to have recourse to the IMF?

-It was a correct decision. It is obvious that it is not easy. I know the sensitivity that it awakens and what it means to have recourse in political and social terms. But it is the best they could do because they anticipated what could happen, they got the best support from the international community and if you look at the IMF package in terms of the magnitude of the amount and the conditionalities, they got the best possible package. And the most important thing is that Argentina managed to maintain total control over the program, the “ownership” of the program. The country is the one that decides the measures that must be taken, and the IMF only confirms the credibility of its commitments before the international community. The IMF understood that the country faces a global crisis and its role is to avoid a possible contagion effect.

-Lazard, are you going to invest in the country?

– Going forward, you have to show why you have to believe in Argentina. We can help attract investors and see opportunities in infrastructure and energy. This Argentina has nothing to do with the default country of 2001 and that can be demonstrated.

– What lesson left you the salvatajes in which it worked?

-With Ukraine, the IMF agreement was very different. He demanded a deficit of 8% of GDP in two years.