Argentina Softens Its Dogmas: Caputo Bets on Mattress Dollars, Roads and Mortgages

ARGENTINA · ECONOMY

Argentina’s government is softening its own dogmas to restart a stalled economy. Caputo’s plan leans on mattress dollars, road concessions and mortgage credit, and pointedly not on the central bank’s printing press.

The dogma that bent: growth without emission

For two years the Milei government repeated one rule. The state does not stimulate, and the central bank does not print.

That rule survives, but everything around it is moving. Caputo is now engineering a reactivation that dodges monetary emission, Minuto Uno reported on 31 August.

The three levers are private savings, public works and housing credit. The first lever has a local name: the dólares del colchón, the mattress dollars Argentines keep in safes and under floorboards.

We covered the government’s first attempt to tap those savings in the Fiscal Innocence plan, which aims at an estimated US$170 billion held outside the system.

The official financial programme for 2026 and 2027 sets the frame. Argentina will honour its obligations without increasing net debt, and it wants investment-grade status by the end of the mandate.

Mortgages funded by the pension guarantee fund

On 26 August Caputo unveiled the concrete piece of the plan. The state will auction ARS 2 trillion (US$1.32 billion) from the Sustainability Guarantee Fund, the pension system’s reserve known as FGS, to fund banks writing mortgages.

The money moves in auctions of ARS 200 billion (US$132 million) each, starting next week. Banks can take one-year funding at inflation-indexed rates plus 2.5 percent, or five-year funding plus 4.5 percent.

The final loans will carry a maximum rate of UVA plus 7.5 percent. UVA units are inflation-indexed, so both sides of the deal adjust with prices.

Caputo says the programme could finance homes for 17,000 to 18,000 families. His example: a US$106,667 property needs household income of ARS 3.46 million (US$2,287) a month and a first instalment of ARS 865,089 (US$572).

That example is also the criticism. Página 12 calculates that fewer than 20 percent of households earn that much, so the plan reaches a narrow slice of demand.

The structural gap is real, though. Mortgage credit is barely 2 percent of gross domestic product in Argentina, against 27 percent in Chile and 75 percent in the United States, Caputo said.

Roads and rail as the public-works leg

The second lever is infrastructure through concessions rather than treasury spending. New bidding rounds for the national road network are advancing under the Concesiones Viales programme.

Construction needs it. The sector operates 25 percent below its 2023 level after the public-works freeze, according to industry figures cited by Página 12.

The flagship is freight rail. Days ago the government launched the concession of 7,594 kilometres of the Belgrano Cargas network, asking for roughly US$1 billion of investment over a 50-year term.

Bids close on 11 November, and foreign companies controlled by other states are barred. The winner can seek benefits under RIGI, the incentive regime for large investments.

Four state companies on the block

The third lever is privatisation. Diario Popular reported on 30 August that the roadmap targets four companies, all meant to move before the first half of 2027.

First is AySA, the water and sewage utility for metropolitan Buenos Aires. Bids for 90 percent of its shares open on 15 September, with no base price but a reference valuation by state bank BICE.

Interested bidders reportedly include businessman Mauricio Filiberti with the Rowing construction group, and Grupo Roggio, which runs Aguas Cordobesas.

Then come Belgrano Cargas, the airport ramp-services firm Intercargo and the energy company Enarsa. For Enarsa, this year’s tender covers the Manuel Belgrano and San Martín thermal power plants.

Caputo has previously put the total potential take from the privatisation programme near US$2 billion. That money would reinforce reserves while the currency controls keep tightening the dollar supply.

Inflation and a papal visit, briefly

Private forecasters cut their August inflation projections again this weekend, and the month could set a new floor for the Milei era. We told the inflation path story yesterday in Argentina Inflation Down to 33.8%: Why the Last Mile Is the Hardest.

And Buenos Aires had unusual visitors. A Vatican delegation arrived on Sunday 30 August to organise Pope Leo XIV’s coming visit to Argentina, TN and Infobae reported, with the itinerary now under discussion.

What to watch from here

First, next week’s initial mortgage auction. The speed at which banks turn ARS 200 billion into actual mortgages will show whether funding was the real bottleneck.

Second, 15 September and the AySA bid opening. A thin auction would sour the whole privatisation calendar.

Third, the mattress dollars themselves. If savers keep their cash at home despite the incentives, the reactivation plan loses its fuel.

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