To contain inflation, Argentina determines the

After days of tense negotiations with food companies, the Argentine government established a list of 1,432 product prices from a price-fixing program. The government of President Alberto Fernández determined that the prices of these products should return to the values ​​of the 1st of October 1st and should remain the same until January 7, 2022.

Products from an expanded basic basket were stipulated for the list, including personal care, cleaning, food and beverage products. With 37% inflation this year alone, Casa Rosada is renewing a measure whose main objective is to protect the population from price speculation and guarantee access to mass consumption products in the context of the pandemic.

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Author of the measure, the Secretary of Interior Commerce, Roberto Feletti, pointed out that the price freeze on certain products is necessary given the acceleration of prices, which ranged from 8% to 25% in the first half of October, mainly on food. .

High food prices in Argentina have increased poverty. As surveyed by the newspaper Tiempo Argentino, half of the nearly 6 million registered and salaried workers in the private sector in July (date of the last official Salary Index report) received a gross salary of less than $60,045 (R$ 3,183), when the basic food basket The total for the period was $67,577 pesos (R$3,582). In September, the value of the total basic food basket reached $70,532 (R$3,981).

The reaction of entrepreneurs

The business and distributor sector resists the measure, despite the list representing only 10% of the total offer of products from large supermarket chains. In a first inspection of compliance with price fixing in large supermarket chains, the government observed 70% compliance with the rules, which they consider “reasonably positive”.

In view of the negative reaction from the business sector and its reaction in the press, a meeting was held between all the governors of the Argentine provinces and Alberto Fernández.

The Secretary of Interior Commerce, Roberto Feletti, said at a press conference this Wednesday (27) that he considered the meeting to be positive:

“There was a clear understanding of the problem and the need to sustain regulatory measures,” he said, in a direct speech where he also mentioned names of supermarkets that would not be complying 100% of the decree, whether in offer or price: Chango more (formerly Walmart), with the lowest percentage of compliance, followed by the chain stump and the international company Day. The report was a conclusion of the first supervision carried out only in the province and city of Buenos Aires.

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“We consider it a transitory measure, in which we will maintain dialogue with companies and that, in the future, we must build a broad, regulated and massively accessible basic food basket in the future, because we are a food producing country, and we cannot be subject to that kind of tension,” Feletti said.

Feletti also highlighted that 46% of the products listed are offered by just 18 companies. The secretary held meetings with representatives of the marketing chains and suppliers. The government official says that large companies in the sector are resisting the measure as they seek to “keep their 30% margins on the final product”.

The mayor of Quilmes, Mayra Mendoza, said in an interview with FutuRock radio this Wednesday (27) that the price freeze guarantees nothing more than the right to access to food. “It does not even mean that companies will no longer make profits. That is not what we are asking for. While the large chains do not want to give up their extraordinary profits, there are families that stop eating. We ask for solidarity and that they comply with what has been established,” he declared .

Positions

Representatives of the commercial sector spoke out against the decree last week, when the measure entered into force, and said that a shortage could occur. The president of the Argentine Chamber of Commerce and Services (CAC), Mario Grinman, argues that this type of initiative “never worked.”

“When the replacement price is higher than the sale price, the merchant takes the product off the shelf,” he said, in an interview with la nation. “When you don’t have the money to pay taxes or salaries, what are you going to do?”

The union sector, on the other hand, starts from a different premise by arguing that the price freeze does not work. Ricardo Peidro, secretary general of the Argentine Workers’ Center (CTA Autonoma) believes that the price control policy should aim at the entire production chain.

“Price setters and economic groups maximized their profits while the population, the working class, suffered the consequences,” says Peidro.

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The union leader defends that it is necessary a much broader and more inclusive participation of workers, cooperatives and sectors of the popular economy, including small and medium-sized companies, in the discussion of prices. “Otherwise, it will be impossible to control inflation and recover the salary we have been losing with the four years of Mauricio Macri’s government and two years of pandemic”, he points out.

Peidro claims that the threat of shortages made by the president of the Argentine Chamber of Commerce and Services in the hegemonic press shows the sector’s resistance to regulation.

“These groups are absolutely dissatisfied with any control made to regulate their labor and social policies. This reaction is not surprising. Therefore, we must deepen the participation of democracy and include the participation of all sectors to balance this balance of forces.” , evaluates the secretary general of the Central de Trabalhadores de Argentina.

Edition: Thales Schmidt

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