Because of a real fall in National Government expenditures, mainly in pensions and government wages, and an increase in the different revenue categories, public accounts improved, and the primary deficit was ARS473.1 billion, 64.0% less than that of the previous year.

  • Revenues showed a real expansion of 18.7% year-on-year (YoY), with the Solidarity and Extraordinary Contribution (ARS144.4 billion) and the jump in Export Duties (97.9% YoY) standing out.
  • Primary expenditures contracted by 7.3% YoY, mainly due to the negative variations in pensions (9.6% YoY) and government wages (5.0% YoY). On the other hand, there were significant increases in capital expenditures (92.1% YoY) and in energy subsidies (43.9% YoY).
  • The level of spending on social programs fell in real terms compared to last year but was three times higher when compared to the same period of 2019.
  • The initial budget for the fiscal year increased by ARS273.32 billion, whose priority allocations were social programs (REPRO II, PROGRESAR and PAMI, among others) and the acquisition, logistics and distribution of COVID-19 vaccines.
  • As of June, approximately ARS177.33 billion were implemented to address the health crisis, equivalent to 43.3% of the current appropriation (ARS409.6 billion).
  • As of June 30, total expenditures amounted to ARS4.21 trillion, equivalent to 48.6% of the current budget appropriation, with government wages accounting for 60.0%.
Fiscal Impact of Public-Private Partnership Projects

Fiscal Impact of Public-Private Partnership Projects

Budget Law 2019 includes eighty projects to be financed through the Public-Private Partnership (PPP) scheme that, if executed, would involve USD73.52 billion of public funds between 2019 and 2048. These projects may generate direct and contingent liabilities for the National Government that will affect the future fiscal performance.

During 2019, the progress of the works is not expected to be recorded as a capital expenditure but as a financial investment (below the line), so it will not have an impact on the balance of the respective fiscal year. Investment Securities (TPI, by its initials in Spanish), issued by the Trusts of each project, are not considered public debt, although they have common features to sovereign bonds and their repayment involves mainly public funds.

Following the best practices in the matter, a methodology for the valuation of contingent liabilities related to PPP projects should be developed, a task on which the Executive Branch is already working.

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