The launch of the new Fair Prices program generates difference of opinion among business people who joined the list powered by the massist leadership. In a wide range, topics range from those who think so “the program will work fine” even those who point it out “it will not serve to mitigate inflation”; they fear continued increases in their raw materials and doubt the official promise to make access to dollars more flexible to finance their imports.
“Although the deal was done very quickly, it should work well because the way it has been handled has been very much agreed with the industry. A significant number of products have been brought together and this speaks for a good response from companies. It should serve the people.” commented the director of an important food company on the market.
Meanwhile, from the chamber that brings together this sector, COPAL, Daniel Funes de Rioja said during the presentation of the list: “if Argentina does not adjust its economy, it is clear that any anti-inflation measures are very limited, because there is an impact on costs, national and international, which has to do with logistics, fuel, which in the case of food ranges from 15% to 30%”.
At the same time, the manager added: “we need consumers and we know the restrictions, but insofar as it results from a short-term agreement and accompanied by macro measures It would be well defined.” indicated the holder of the Copal.
Slightly more incredulous, a source at another mass-consumption multinational commented that “industry cooperated as always in response to the Commerce Secretary’s request to expand the basket we already had and even freeze it for another few months.” , he described. “On the other side, for now there is only the promise to authorize imports of raw materials produce these same products. We will see how it evolves in the coming days,” she commented.
The directive therefore referred to the fact that, in exchange for companies adding products to the list of fixed prices for four months, the government has promised them flexibility in imports.
“This promise needs to be taken with a grain of salt because what is published in the Official Gazette does not even mention access to the free foreign exchange market,” commented another executive with a more negative view. Meanwhile, another source summed up, “it’s hard to figure out where the dollars will come from for the more than 100 companies participating in the program.”
As for shrinking profit margins which means factories won’t move prices more than 4% in four months as inflation aims to end the year at 100%, business owners say their main concern is commodities “that go up 15/20% per month or are dollarized”have noticed in another major industry.
“We all know that’s not the solution. And it is difficult to make it clear that the adjustments take place for so many variables that affect and inevitably shift and that in their conformation there are multiple players including their margins and profits”, pointed out another businessman from a multi-food company.
“For companies, for the government to set a price for a fixed period of time is complex under unstable conditions. As for the consumer, “at first he will go looking for those products and then he will return to his more planned and punctual purchasing pattern, choosing what he most wants by brand and price”, predicts the same source.
Source: Clarin
