While the new Argentine government's spending cuts and tax hikes will help Buenos Aires reduce its fiscal deficit and eventually reduce inflation, these benefits will come at the price of heightened social unrest amid worsening living conditions in the short to medium term. On Dec. 12, Argentina's new Economy Minister Luis Caputo unveiled a 10-point plan that combines spending cuts and tax hikes to severely reduce the country's fiscal deficit and lower inflation. The main measures include a devaluation of the Argentine peso by more than 50%, an increase in taxes for imports and exports, a reduction of the number of federal ministries and secretaries by half, a reduction of the fiscal transfers from the federal state to the provincial governments, the cancellation of public infrastructure works that were scheduled to begin in 2024, and an unspecified reduction in subsidies for electricity, natural gas and public transportation. Caputo also announced...
