Argentina's Scioli Fails to Deliver `Big Blow' in Debate

  • Macri accuses Scioli of lying, Scioli says Macri will devalue
  • No outright winner in debate, which suits Macri as frontrunner

Argentine presidential candidate Daniel Scioli, trailing in the polls ahead of the Nov. 22 election, failed to strike a “big blow” against his rival Mauricio Macri in Sunday’s debate, damping his chances of a late revival, said analyst Juan Cruz Diaz.

In a bitter discussion, Macri accused Scioli of lying, while the ruling party candidate said Macri’s policies were a “danger” to the country, that would lead inevitably to a devaluation of the peso, unemployment and higher debts. Macri, the current mayor of Buenos Aires, retorted that Scioli represented continuity of a government that lied about rising poverty levels.

“Scioli needed to land a big blow and he wasn’t able to do that,” Diaz, managing director at risk advisory firm Cefeidas Group, said by phone. “I don’t think this moves the needle much. Macri survived and maintains his momentum.”

Scioli, who declined to take part in a debate featuring all the candidates before the first round last month, hammered home his message of the risks of shock therapy for the economy, while failing to distance himself from association with President Cristina Fernandez de Kirchner’s economic model. Macri’s policies would leave Argentina on its knees before the International Monetary Fund and so-called vulture funds, he said.

“I’m waiting for an answer to the question: Who’s going to pay the costs of the devaluation when you free the exchange rate and lift currency controls and begin to remove subsidies?” Scioli said. “You, the worker, need to know that I am here to protect your future,” he said.

Macri, dressed in a suit without a necktie, denied he would carry out a severe economic adjustment and accused Scioli of seeking to create “phantoms and demons” in a deliberate campaign of fear.

“You continue to be a spokesman for things that I don’t plan to do,” Macri said. “You persist with this scratched record of lies.”

No Proposals

Scioli’s arguments were based on comments by Macri that he plans to lift currency controls installed by Fernandez in 2011 and allow the market to decide the peso’s value. While the official rate is 9.6 pesos per dollar, many Argentine companies and individuals pay as much as 15 pesos per dollar on a black market.

Macri argues that the peso will find an equilibrium that represents the average of what most Argentines pay to gain access to foreign currency.

Market reaction to the debate was limited, with Argentina’s benchmark dollar bonds due in 2033 rising 0.1 percent to 110.87 cents on the dollar in morning trading in Buenos Aires.

The televised presidential debate, the second ever to take place in Argentina, achieved the highest audience in the country since the final of FIFA’s World Cup in July 2014, according to El Clarin newspaper.

There were few concrete proposals put forward by either candidate. Macri said he would excuse young workers from tax during their first five years in the workforce and pledged to create two million new jobs over the next decade. Scioli said he would bring in $20 billion to bolster reserves and said he would maintain subsidies on energy bills and transport.

Body Language

In a poll by Jorge Giacobbe & Asociados, Macri had 49 percent of intended votes against 42 percent for Scioli with 4.7 percent undecided ahead of the Nov. 22 runoff. The nationwide poll of 1,500 people taken Oct. 31 - Nov. 13 had a margin of error of 2.58 percentage points.

No candidate scored a clear victory, but Macri had better body language and remained calm in the face of Scioli’s onslaught, Jorge Piedrahita, chief executive officer at Torino Capital LLC in New York, wrote in an e-mailed note to clients.

“While debates rarely change voting intentions in a significant manner, today’s debate seals Macri’s victory next Sunday,” Piedrahita said.

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