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News > Argentina

Macri Unrolls Measures to Manage Economic Crisis He Created

  • Production Minister Dante Sica, Treasury Minister Nicolas Dujovne and Social Development Minister Carolina Stanley in Buenos Aires, Argentina, April 17, 2019.

    Production Minister Dante Sica, Treasury Minister Nicolas Dujovne and Social Development Minister Carolina Stanley in Buenos Aires, Argentina, April 17, 2019. | Photo: Reuters

Published 17 April 2019

The "short-term" policies are expected to provide relief while the IMF policy "does its job."

Argentine President Mauricio Macri announced new policy measures aimed at abating an out-of-control inflation rate that hit 54.7 percent in March, the highest it has been since 1991.

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The series of "ameliorating" measures introduced by the Macri administration Wednesday comes months prior to Argentina's October presidential elections. Incumbent Macri has seen his approval rate shrink from around 70 percent when he entered office in 2015 to 37 percent in February of this year.

"The measures are going to be a relief and give us new short-term tools while the (International Monetary Fund's policy) does its job," referring to the US$56.3 billion loan the administration solidified in September. Macri has said that "this gives us the strength to continue other battles."

In a press conference at the Olivos Presidential Residence, Production Minister Dante Sica, Treasury Minister Nicolas Dujovne and Social Development Minister Carolina Stanley announced five main policy measures that the government agreed to with the support of politicians and businessmen.

The ministers said they had reached "a deal" with 16 corporations to maintain a "price freeze" on 60 basic products over the next six months, until October. The move, which may be too little too late in a country set by a recession since around last October, is an attempt to combat consumer price increases of common food items such as tomatoes, beef and yerba mate that, during March alone, rose by 31.3 percent, six percent and 6.9 percent, respectively. 

Argentine economist Lorenzo Sigaut Gravina, from the agency Ecolatina said that the conditions may be counterproductive because the agreements took two weeks to solidify during which time companies were first able to raise their prices. 

"The perverse thing about this is that, as it took two weeks to define, businesses took advantage to raise prices and make a cushion so that paradoxically we have even higher inflation in April than in March," says the expert.

The nation's treasury will reduce tax rates for some Argentines, and allow some citizens to lower their interest rate payments on certain loans along with an extended payoff timeframe.

"A graphic description of the measures announced by Macri to lower inflation."

The government says it will also approve a "Commercial Loyalty" law that allegedly seeks to protect small business and consumers from business monopolies.

In addition, Macri's cabinet members medicines will set up a 70 percent discount on pharmaceutical items for the unemployed and Argentines who earn less than the national minimum wage. 

The Argentine government will not increase electricity, gas and public transport rates for the remainder of the year, said the ministers in the Wednesday press conference in an aim to quell continual and massive social protests that social movements and unions have been staging for well over a year in protest the constant, heavy-handed neoliberal measures.

During 2017 and 2018, the Macri administration eliminated several energy, gas and public transportation subsidies, cut public jobs by the tens of thousands, got rid of several ministries and sold off dollar reserves by the billions. All of these economic moves have contributed to the current recession Macri is attempting to turn around in order to gain October votes.

President Macri only commented on the measures via a scripted Youtube video in which a family tells him its economic problems, which unleashed indignation through social networks.

"If you voted for Macri and you see him now doing a video script to announce economic measures, don't you feel ashamed," a young Argentine woman asked.

"Macri is not brave enough to stand up and announce economic measures which are aimed at saving him until the elections. He records a #$%& video, sends one of his ministers and 'the journalists' do the rest," another Argentine woman commented via social media.

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