Government Policy To Raise Debt Load

On November 26 Argentina's lower house approved an extension to the Economic Emergency Law that grants the government extra powers over public spending. The measures were first adopted during the 2001-2 economic crisis, but have since been extended for six consecutive years. They give President Cristina Fernández's government the powers to determine off-budget spending by decree - something which will continue to raise fears among foreign investors of the sustainability of the president's spending ambitions. The excessive powers held by the executive are also a contributing factor to Argentina's poor score of 61.9 in our long-term political risk ratings.

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