According to a survey carried out Clarion between supermarkets in the United States, England and Mexicoproducts sold in gondolas in Buenos Aires already record similar prices to those in many places abroad and compared to just a few weeks ago. In some cases in Argentina you pay even more. The inflationary acceleration of recent weeks, following the devaluation of 20 days ago, has triggered a spiral that has caused foods such as oil to increase by more than 100%, producing a phenomenon of inflation in dollars.
Clarion took a sample of seven products. A liter of milk, a 500 gram pack of long noodles, a pack of long grain rice, a dozen eggs, a can of tomatoes, a one and a half liter bottle of Coca Cola and a Starbucks latte.. In the case of the Coca Cola bottle and Starbucks coffee, these are identical products in Buenos Aires, Miami, London or DF (commodities) and the comparison “stands out”. Something similar to what the English magazine The Economist does with the Big Mac: it compares the price of a McDonald’s hamburger worldwide.
For the rest of the products, the exercise was governed by the criterion of the “lowest price” offered by the supermarkets on their pages at the time of the comparison (last Friday). Walmart in the United States and Mexico, Waitrose in England and Carrefour in Argentina.
Some data emerge from the analysis that reveal the deterioration of food competitiveness in Argentina. The cheapest pack of long spaghetti today at Carrefour (Terrabusi 500 grams) is more expensive than at Waitrose (Waitrose brand) and only 12% cheaper than in the US.
Something similar happens with a can of tomato, a bottle of Coca Cola or a dozen eggs. Only milk or coffee from international chains, to name a few examples, demonstrate that in Argentina there are still goods that are sold at a lower price. Currently.
The comparison is used to appreciate an unleashed phenomenon in a very short time: the sudden increase in dollar prices of a set of goods.
Instead, to understand the phenomenon, it is necessary to note Salaries did not increase in the same proportion during that period. In other words, the dollar has fallen in recent weeks.
So, a packet of noodles in Argentina is practically the same price as in other parts of the world, but the unsuspecting reader should know that here the minimum wage is 190 dollars and in Great Britain noodles are paid 40% less than in Argentina. and the minimum wage is twelve times higher ($2,283). In the United States, noodles are more expensive than in Argentina (12%), but their economy pays a much higher minimum wage than Argentina’s ($1,218).
Economist Fernando Marull estimates that taking into account an average salary of $532,000 in December, with November and December increases of 10% and 15% respectively (the minimum is $156,000), one obtains a dollar salary of US$591. “We have low wages in dollars, there is no discussion”. In any case, the economist clarifies: “There are three comparisons: food, services and durable goods.”
While goods in Argentina are expensive, services cost less than in other countries. The latter is what economists call “relative prices,” an expression to refer to the phenomenon that one set of costs is different from another. In the case of Argentina, essentially with a mix of cheap services and expensive products, a strong push in demand has been generated in all these years to the detriment of supply and production. Seeing a Starbucks coffee in Buenos Aires costs half as much as in London, New York or Mexico, you can understand why there are queues in the bars of Palermo but the supermarket shelves are empty or the sector is in decline.
Furthermore, the fee to join a club or play sports in Argentina is cheaper than in any other country. And despite the sharp increase in the last month, work by Ieral and the Sociedad Rural del Noreste Santiagueño which has recorded prices in recent weeks, has found that beef in Argentina is still cheaper than in Uruguay and Chile (although more expensive than in Brazil and Uruguay). .
Is the price of the dollar in Argentina behind?
It’s risky to say yes again. But if we add to December’s inflation – estimated at 30% – the increase in prices that will occur on subways, buses, trains, tolls and delayed parking, for many it is difficult to think that the adjustment of the rate of change remains to 2% monthly beyond January and all the more so since “salaries do not start to move with some monthly adjustment formula that follows past inflation”, says economist Martín Rapetti. “The gap will begin to widen during the first quarter, fueling the inflationary process,” he predicts. Economists close to the Government think like Rapetti even if they don’t dare say so publicly. For now only the gondolas speak. And if prices continue like this, perhaps the maxim uttered by Carlos Melconian during the campaign to criticize the idea ofdollarization will be realized: “There are no noodles or tuco.” The noodles already come out like in Miami or London.
Source: Clarin
