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Argentina’s Bright Young Hope

Martin Guzmán is among the world’s leading experts on sovereign debt and the problems it can cause. With his appointment as Argentina's Minister of Economy by President Alberto Fernández, Guzmán has become the right person in the right place at the right time.

NEW YORK – Judging by his appointment of a first-rate economist to his cabinet as Minister of Economy, Argentina’s new president, Alberto Fernández, is off to a good start in confronting his country’s economic problems. Martin Guzmán, with whom I have frequently collaborated in recent years, is among the world’s leading experts on sovereign debt and the problems it can cause, making him the right person in the right place at the right time.

After completing his PhD at Brown University under Peter Howitt (co-author with Philippe Aghion of seminal work in modern growth theory), Guzmán obtained a coveted position at Columbia University, where he forged an academic career and became an influential expert on crucial policy debates at the domestic and global level. He has testified before the US Congress on Puerto Rico’s debt crisis and spoken at the United Nations about the need for a better international system for resolving sovereign debt crises. In recent years, he has divided his time between New York and Argentina, where he is a professor of macroeconomics at the University of Buenos Aires.

When former President Mauricio Macri took office, his economic team openly admitted that while they had inherited many problems, they started with one major advantage: a low level of debt. They gambled on a set of policies – making, for instance, untimely and unnecessarily large cuts in export taxes, paying off old, defaulted debt to so-called vulture funds with unconscionably high returns, and taking on new high-interest, long-term, dollar-denominated debt, all in the hope that market-friendly signals would lead to a rush of growth-spurring foreign investment. Even at the time I thought it was a foolhardy gamble.

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