Argentina's Massa replaces top Kirchner allies

The Economy Minister Sergio Massa announced on Sunday night the shake-up of the country's energy leadership, removing top allies of Vice President Cristina Fernandez de Kirchner as the government prepares to cut electricity subsidies.

Massa said that Flavia Royon will take over Monday as Energy Secretary, replacing Kichner's ally Dario Martinez. Santiago Yanotti, Federico Bernal and Cecilia Garibotti will be Royon's undersecretaries, he said.

The move puts one of Argentina's most politically sensitive offices under Massa after he took over the Economy Ministry last week amid heightened market volatility. Argentina spent close to $11 billion in energy subsidies last year and the government agreed this year to scale back the payments to reduce the fiscal deficit as part of its deal with the International Monetary Fund.

Massa said that the goal must be energy sovereignty and the transformation of Argentina as a power in this sector.

In separate tweets, Martinez was often at odds with former Economy Minister Martin Guzman, who resigned in early July citing lack of political support. The energy officials close to Kirchner resisted Guzman's attempts to remove subsidies on utility bills that would result in higher prices for consumers.

In Argentina, where a large portion of the population equates electric and gas bills to taxes, rising utility rates pose deep political costs.

Massa, one of the leaders of the ruling coalition that governs the country since late 2019, took over with more political clout than his predecessors. In his first announcement on Aug. 3, he said utility rates would go up and those receiving subsidies would have to limit energy consumption.

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