Barriers to imports are starting to have a domino effect on prices. In a new version of the short blanket that defines the Argentine economy, the measures taken by the government to stop the bleeding of the Central Bank’s reserves push prices one step higher.
From October 17, the Import System of the Argentine Republic (SIRA), a new tourniquet on foreign trade, began to be implemented. Official figures show that 78,067 affidavits have been filed since its inception by 12,048 operators for a total of 8,265.7 million dollars. Thus, the government ensures that 50% of the orders received have been approved.
Along with this new system to authorize imports, Sergio Massa’s team reported that those importers whose exchange request is rejected by the Central Bank will be able to use their dollars to import.
For economists there is no doubt: if companies have to use dollars in the mattress or go to cash with liqui to have foreign currency, It will be these prices that will define the new prices.
“It is difficult to calculate the impact, but clearly the inflationary shock of the coming months will be more similar to what happened after the departure of Martín Guzmán “says Fernando Marull, director of the consulting firm FMyA.
“The Monday following the resignation, everyone put up a 20% price increase. because they imagined that a devaluation would come. We are not there yet, but we are already seeing that the impact of SIRA has been strong. There was a general cut in all imports, which affected consumer goods, but also inputs and capital goods, “explains Marull.
The noise produced by the new import control generates the paradox that prices overheat due to difficulties in accessing the official dollar, while the parallel dollars sleep the nap of the exchange and remain at the same values in the last two months.
Despite this summer, when importers who do not access the Single Free Trade Market have to set a price, they look to the future dollar. “They take the March values and apply that increase to the prices,” says Marull.
Today the wholesaler enters $ 158 and I’m in $ 240.
“Today, importers see an intermediate point between the official dollar and the parallel one, which means a 50% surcharge,” says the economist.
“But if they are forced to use their own dollars, the price is $ 290, 80% more than the wholesaler. This is the repricing you see “summarizes.
Lorenzo Sigaut Gravina, director of the consulting firm Equilibra, points out that in recent months some imports have taken alternative dollars as a reference. “From the crisis of the three ministerswith all the uncertainty, the widening exchange rate gap and the obstacles to imports, there were many items with strong price jumps, like appliances.
“Those who use their dollars will do so if the business is profitable, and today those dollars are worth what the financial dollar is worth ($ 305 in cash with cash), not what the official is worth. But some of that was already happening,” says Sigaut Gravina.
“The impact is very difficult to pinpoint, but something will add to fourth quarter inflation, which for us it will be between 6 and 7% per month“, he observes.
For Sebastián Menescaldi, director of EcoGo, the system promoted by Massa is not very attractive for companies. He explains that importers who seek foreign currency for cash with liqui will continue to be denied access to the MULC, the wholesale dollar, as is the case today.
“The regulations do not allow them to enter the MULC. I don’t see many incentives for companies to do this, at least in the short term. One sector that could possibly do that is cars, which will pass on some prices, “he says.
“For now, I don’t see a big impact on imports and prices with this measure. But it’s still widespread, not everything is clear,” he explains. However, EcoGo’s projections prove this Inflation will be 6.5% in November and 7.1% in December.
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Source: Clarin
