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News > Latin America

Argentines Face Price Hikes Amid Gov't-IMF Austerity Deal

  • Protests against the government's economic policies and the IMF deal in July.

    Protests against the government's economic policies and the IMF deal in July. | Photo: Reuters

Published 2 August 2018

Social organizations and workers' unions have organized a protest for August 7 to reject the IMF deal.

The government of President Mauricio Macri in Argentina has applied new tariff hikes to reduce public spending, as part of the austerity plan laid out to access a US$50 billion standby loan from the International Monetary Fund (IMF).

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The previously announced measure went into effect Wednesday and will increase the prices of health insurance, which will increase by 7.5 percent. This increase follows an increase in February of four percent. 

Utility services such as electricity and gas will also become more expensive. Energy minister Javier Iguacel announced in a press conference electricity prices will increase by 20 percent for those with high consumption rates and 29 percent for other consumers.

The rate increase will impact the greater metropolitan area of Buenos Aires and other provinces. Central Government has, however, defered the level of the rate increase outside of Buenos Aires to the regional governments, which already control distribution.

Public transportation cost, including the subway in the city of Buenos Aires and the trains that connect the city with the greater metropolitan area, will increase by 30 percent between August and October. The rate will increase every month by about one Argentine peso, which due to the rapid depreciation is currently US$0.04.

A five to six percent increase for super gasoline has also been announced with a seven percent increase planned for premium gasoline. 

Public service price hikes have been constant during Macri’s government and both social organizations and opposition legislators have pushed back against these measures.  

In May legislators approved a bill to roll back home water and energy rates to match those of November 2017, but Macri vetoed the bill. The bill was crafted to protect Argentines form increasing prices in a context of rising inflation, increasing unemployment and currency devaluation.

Workers' unions, social movements and organizations have called for a massive protest on August 7 to reject the IMF deal and demand five laws to guarantee "bread, peace, land, roof, and work." 

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