February 12, 2021
1. Government meets with labor unions and business leaders to negotiate economic agreement
This week, representatives from the national government met first with labor union leaders, and then with business leaders to reach an agreement on prices and salaries in a bid to control inflation. The 2021 budget uses 29% inflation as a baseline, while other market analysts project inflation as high as 50% for this year. Labor unions were ensured in their meeting on Wednesday that there would not be caps on salary increases imposed by the government after Chief of Staff Santiago Cafiero stated that, “a Peronist government does not put a limit on salaries.” In this sense, the government’s primary objective is to reach an agreement to put limits on price increases and control inflation. Aside from Cafiero, government representatives at the meeting included Labor Minister Claudio Moroni, Productive Development Minister Matías Kulfas, Economy Minister Martín Guzmán and Vice Chief of Staff Cecilia Todesca. Labor union representatives included Héctor Daer (health), Carlos Acuña (gas stations), Hugo Moyano (truckers), Sergio Palazzo (bankers), and Hugo Yasky (CTA labor union). Daniel Funes de Rioja (COPAL), Martín Ticinese (Quilmes CEO), Ivan Szczech (CAMARCO) and Daniel Herrero (Toyota CEO), among others, attended on behalf of business leaders, who had the meeting on Thursday.
2. President Fernández promises to not increase withholdings on agriculture sector
At the presidential palace, President Alberto Fernández received the “Mesa de Enlace,” a group that gathers the primary agricultural entities in the country, promising not to increase withholdings after having suggested it in an interview with Página 12. According to those in attendance, the ambience was cordial and positive. In addition to the topic of export taxes, price increases, the fight against coronavirus and the vaccination plan were also touched on. The President was joined by Agriculture Minister Luis Bastera, Chancellor Felipe Solá, Strategic Issues Secretary Gustavo Beliz and Vice Chief of Staff Cecilia Todesca. Agriculture sector representatives included Argentine Agrarian Federation (FAA) chief Carlos Achetoni, Argentine Agrarian Confederation (CRA) head Jorge Chemes, Carlos Iannizzotto from CONINAGRO and Daniel Pelegrina from the Argentine Rural Partnership.
3. In-person classes to restart in Buenos Aires on February 17th
Education Minister Nicolás Trotta and Buenos Aires Mayor Horacio Rodríguez Larreta met to reach an agreement on the return of in-person classes on February 17th. The meeting was described as positive by Rodríguez Larreta, following disputes between the Peronist party and the opposition party in charge of the city over how a return to the classroom should take place. Trotta assured that permanent dialogue and joint efforts have helped both parties confront the uncertainty of the pandemic together. Soledad Acuña, the Minister of Education for the City of Buenos Aires, also attended.
4. Government advances on vaccination plan
On Wednesday night, a new Aerolíneas Argentinas flight departed for Moscow to bring a shipment of the Sputnik V vaccine to supplement the government’s vaccination plan. The shipment consists of 400,000 units of the first dose – the highest volume of vaccines brought on a single flight so far – and 1.22 million doses in total. The vaccines are set to arrive in the coming days. On similar note, the national government reached an agrrement with Chinese pharmaceutical company Sinopharm to provide 1 million doses of the vaccine at a price of USD $40 per full vaccination (both doses). The first shipment of the vaccines will arrive in Argentina at the end of February.
5. January inflation reaches 4%
The Argentine statistical agency (INDEC) reported that its consumer price index – the country’s official measure of inflation – stood at 4%, the same figure recorded in December 2020. When measured from January 2020, the total inflation figure accumulated to 38.5%. Main drivers behind the figure included a 4.8% increase in the prices of food and beverages, and 15% in the telecommunications sector, a sector where the government intervened. Additionally, government intervention leading to a price increase in fuel and public transit catalyzed a 4.6% increase in the transportation sector. Monthly inflation was also characterized by tourism and recreation activities as a result of the summer months. This same week, Economy Minister Martín Guzmán ratified the country’s objective to reduce inflation to the 29% annual figure cited by the government in its 2021 budget.
Ámbito Financiero: La inflación de enero se mantuvo en 4% por segundo mes consecutivo