President-elect Javier Milei let slip his choice of economy minister during a radio interview Wednesday morning, saying that Luis Caputo will take over the job with a mission to pull Argentina from its deep economic crisis.
Speaking to Mitre radio after returning from a trip to the US, Milei said that Caputo along with cabinet chief Nicolas Posse had remained in Washington to keep working with representatives of the US Treasury and the International Monetary Fund on an economic plan for Argentina.
“The meetings at the Treasury and at the IMF were led by cabinet chief Nicolas Posse and by Economy Minister Luis Caputo,” Milei said during the interview. “At some point during the day, they will get back to me about what happened.”
Milei’s spokesperson didn’t immediately respond to a request for comment.
Read More: Milei to Send ‘Shock’ Package to Argentina’s Congress on Day One
Caputo will be in charge of implementing Milei’s plans to curb inflation that is now running above 140%. Other tenets of Milei’s platform, like closing the central bank and dollarizing the economy, appear to be on pause until he can rein in public spending to balance the budget — one of the culprits of runaway inflation.
The new economy minister will face titanic challenges, including how to unwind a web of currency controls and price freezes imposed by the outgoing government without triggering hyperinflation.
Caputo will have to lift more than a dozen exchange rates that are now in place to encourage exports, while safeguarding a nearly depleted stock of international reserves. The official peso rate is now held artificially low at 359.5 per dollar, while the parallel exchange rate is nearly 1,000-to-1. More than 1,000 basic goods are subject to price controls.
He will have to do it all with the economy stalled, public finances in shambles and more than 40% of the population living in poverty.
Caputo served as finance chief during the beginning of Mauricio Macri’s administration, when he negotiated a $16.5 billion deal with holdout bondholders, allowing Argentina to return to international capital markets. He later issued a 100-year bond that the government of Alberto Fernandez swapped after defaulting again in 2020.
Amid a currency run in 2018, Macri tapped Caputo to take over the central bank. But he served only a few months before unexpectedly stepping down amid tensions with the IMF.
On Tuesday, Caputo returned to the IMF for the first time in his new role. He met with IMF Deputy First Managing Director Gita Gopinath and staff, including Western Hemisphere Director Rodrigo Valdes and assistant director Luis Cubeddu, who spearheaded negotiations over Argentina’s current $43 billion program.
(Adds context on IMF past, economic situation)
