Next year’s projected expenditure on energy and transportation subsidies amounts to AR$805.8 billion, which is equivalent to 2.2% of Gross Domestic Product (GDP), at the same level of that foreseen for 2020. Of these funds, 77.4% is allocated to subsidize the gas and electricity sector, and 22.6% to transportation.

  • Since 2017, energy subsidies have grown 0.5% of GDP and in 2021 they will be at 1.7%, same as this year. The highest record was in 2014, with 2.8%.
  • The most significant allocations are for the electricity sector, with AR$446.6 billion foreseen in the Budget Bill for 2021, a real increase of 4%.
  • Users will face 43% of the estimated cost of electricity next year, a level comparable to that of 2016.
  • The energy deficit in the last decade averaged USD2.98 billion, contrasting with the trade surplus of that time.
  • A total of AR$71.7 billion will be allocated in subsidies to natural gas supply, which implies an increase of 5.3% with respect to the expected for 2020.
  • A rise in subsidies to natural gas demand is also foreseen, including a higher subsidy to liquefied gas cylinders.
  • Transportation subsidies would remain at 0.5% of GDP, with an increase for motor vehicles and a cut for trains.
  • Travel on working days will increase 200% and the AR$12.7 billion to finance social fare implies a drop in real terms of 17.7% in relation to the expected for 2020.
  • In the last months, 91% of the costs were covered with subsidies and the passenger load factor was 5%.


The Budget Bill for the year 2021 estimates an interest expense for the national government of AR$665.95 billion for 2020 and AR$661.18 billion for 2021, including interest payable to entities within the national government. If government-owned companies, trust funds and other entities are considered, the estimated interest expense of the National Non-Financial Public Sector is equivalent to 2.5% of GDP in 2020 and 1.8% in 2021.

For 2021, the Budget Bill foresees financing needs for a total of AR$6.26 trillion (16.7% of GDP) which is assumed to be financed with new debt with entities of the national public sector for a total of AR$3.68 trillion (including temporary advances from the BCRA – Central Bank of the Argentine Republic), issuance of domestic debt securities to the private sector for AR$2.22 trillion and disbursements from international and bilateral entities for AR$348.9 billion.

Regarding BCRA’s financial assistance to the Treasury, the Budget Bill anticipates a net financing through Temporary Advances for AR$400 billion in 2021 (1.1% of GDP). In addition, profit transfers from the BCRA to the Treasury are estimated at AR$800 billion (2.1% of GDP).

Sections 42, 28 and 50 of 2021 Budget Bill establish limits to the gross amounts of securities issuance and loans maturing after the closing of fiscal year 2021 with a total authorized amount equivalent to AR$6.57 trillion. On the other hand, Sections 43 and 44 authorize the use of short-term credit (maturing within the same fiscal year), establishing limits on the outstanding amounts of such instruments for a total of AR$1.75 trillion.

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