October 22nd, 2021
1. Price controls: the government extended the list of products to 1432
Through Resolution 1050/2021, the government established the temporary fixing of maximum consumer sales prices for all producers, marketers and distributors of 1,432 mass consumption products throughout the national territory until January 7, 2022. Roberto Feletti, Secretary of Domestic Trade, stated that “what we are doing is right. It is going to be a much more comprehensive price watch, with more than double the number of products, and to ensure for 90 days a certain stability in that basket to facilitate consumption”. The decision was taken within the framework of the round of negotiations promoted by the Secretariat with all the actors that make up the production and commercialization chain of the various items that make up the announced basket. The opposition criticized the measure and described it as a patch that does not solve the underlying problem. “In Argentina it has been demonstrated a thousand times that price controls by the State, in a compulsory and obligatory way, have never worked in history”, remarked the head of the Buenos Aires Government, Horacio Rodríguez Larreta, in line with the position adopted by the Macrismo party. In line with these announcements, the National Institute of Statistics and Census (INDEC) published the monthly variation of the basic food basket (CBA) for September, which was 2.7% with respect to August, the month with the lowest increase in the year. Meanwhile, the total basic food basket (CBT) showed an increase of 3.2%. Thus, according to the report, between January and September of this year, the CBA accumulated 28.5%, while the CBT was 26.1%. The report shows that a four-member household needed ARS $70,532.46 to overcome the poverty line in September 2021: 3.2% more than the previous month.
2. Economic activity grew by 1.1% in August
According to the Monthly Economic Activity Estimator (EMAE), published by the National Institute of Statistics and Census (INDEC), the national economy advanced by 12.8% year-on-year in August, compared to the same period of the previous year, and experienced an increase of 1.1% in its seasonally adjusted measurement, that is, compared to July. In this way, the indicator recorded the third consecutive improvement, after the declines recorded in April and May, explained by the restrictions due to the second wave of the coronavirus. When analyzed by branch of activity, the 15 sectors that make up the EMAE grew year-on-year in August. Nine of them showed double-digit variations against the same month of 2020. The activities with the highest positive impact on the year-on-year variation of the EMAE in August were “Manufacturing Industry” and “Wholesale, Retail Trade and Repairs”.
3. Alberto Fernández stated that it is necessary to rethink the framwork for debt restructurings
At the Finance in Common 2021 Summit, President Alberto Fernández called for rethinking “the international financial architecture” to allow middle-income countries to restructure their debts. He also stated that the extension of the Debt Service Suspension Initiative produced by the G20 is an insufficient measure and called for the extension of the new G20 Common Framework for Debt Treatment to middle-income countries with vulnerabilities. These statements were made in the run-up to the G20 Summit, to be held in Rome on October 30-31.
4. Packaging management in Congress
The national deputy for San Luis, Carlos Ponce (FdT), vice-president of the Industry Commission, presented this Tuesday two bills that seek to limit the production of single-use plastics and promote the circular economy in the industry. The first aims to establish minimum budgets for the production, commercialization and sustainable use of single-use plastics. It seeks to prevent and reduce the impact of plastic products on the environment, encourage the repurposing of single-use plastics, promoting their replacement by bio-based, compostable and biodegradable materials. The second project establishes the minimum requirements for the progressive transition of the industry to the circular economy. Among its objectives are the reduction of the impact on the environment caused by post-consumer products, promoting a progressive transition of the industry to one based on the principles of the circular economy and the recovery of raw materials from household solid waste to reduce the use of natural resources, among other points. Tax incentives for companies that adhere to these changes are also highlighted. At the same time, the Minister of Environment Juan Cabandié assured that in the short term he would present his own project focused on Extended Producer Responsibility and the inclusion of recyclers. With respect to legislative activity, next Tuesday the Chamber of Deputies will meet in person. In the agenda, agreed upon by the main blocks, is the Front Labeling Law, which weeks ago was the cause of strong disagreements between the ruling party and the opposition.
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5. The government announced that it will extend the industrial production regime in Tierra del Fuego
The National Government announced on Monday the extension of the industrial promotion regime for Tierra del Fuego. In exchange, companies will have to invest USD 1,500 million to diversify production and carry out infrastructure works. The announcement made by President Alberto Fernández also provides for the creation of a fund for infrastructure works for the development of a Technological and Industrial Pole in the southern province and creates the Fund for the Expansion of the Fuegian Productive Matrix (FAMP-Fueguina), which is financed with contributions from the companies of the subregime. Shortly before its 50th anniversary, the industrial model of the province will now have a new extension of 15 more years from 2023 -the date on which the last extension expired- so that it will be in force until 2038. Once this period has expired, the project foresees the possibility of extending the benefit again for the same period.