As per the Argentina budget 2012 presented recently by the economic minister Amado Boudou the fiscal plans and programs initiated by the President, Cristina Kirchner, will be used in the upcoming fiscal as well.
Argentina Budget 2012 Expectations:
The 2012 budget will make the domestic market a stronger one. It will focus on maintaining the present levels of social inclusion and overall economic growth.
The government expects it will earn ARS668 billion, which is 23 percent more from the 2011 fiscal. The income taxes are supposed to contribute ARS131 billion, which represents an increase of 23% from 2011 fiscal.
The revenue from value added taxes will go up by 23.5 percent to touch the ARS185 billion mark.
In 2012 budgetary surplus is expected to touch the $8.5 billion point for 2011 this figure has been pegged at 9 billion dollars.
The primary budgetary surplus for 2012 is expected to account for 2.5% of the GDP.
This will not include the interest payments.
The aggregate budgetary surplus will comprise 0.2 percent of the GDP in 2012.
Argentina Budget 2012 – Expenses:
The 2012 Argentina budget is expected to increase the expenses in the infrastructural sector like roads, power plants and bridges.
The budget for the 2012 fiscal will also maintain the social programs like ones that will extend support to families with newborn kids.
The Argentina budget 2012 has also earmarked 5.7 billion dollars for paying off its debts. This money will be taken from the central bank and foreign exchange reserves. Economic experts, though, opine that Argentina s fiscal reserves might not be enough to pay off its mounting debt. At present, the extra reserves of this South American are approximately 6 billion dollars. It is expected that the government might need to borrow from the credit markets. This will be the first time such a transaction happens after 2002 when sovereign debt went up to approximately $100 billion.
Argentina Budget 2012 – Impact on Economy:
The national government expects that GDP growth will be reduced to 5.1 percent in the upcoming fiscal. The forecast, according to experts, is realistic in view of the present global financial condition. It is also similar to ones made by the IMF and private bodies.
Economic analysts think Argentina s economy might struggle in the coming days if it fails unable to achieve the targeted growth rates.
The rate of inflation for 2012 is expected to be 9.2 percent. The value of the Peso is supposed to go down to ARS4.40 in the upcoming fiscal.
As per the IMF, Argentina will see its inflation reach double digits in 2012 fiscal.
In 2012 fiscal GDP is expected to go up to ARS2.085 billion or 496 billion dollars, according to the present exchange rate. For 2011 fiscal the GDP has been estimated at ARS1.77 billion.
The GDP is expected to increase by 4.6 and 4.7 percent in 2013 and 2014 as well.
The average exchange rate for 2012 is expected to be ARS4.40. For 2011 fiscal this rate has been pegged at ARS4.13. In 2013 this rate could go up to ARS4.69 and ARS5.0 in 2014 fiscal.