General
Government resumes call to companies and unions to discuss prices and wages
From the economic leadership it has been pointed out that inflation and the consequent loss of purchasing power of the population are the issues that generate the greatest short-term concern in the Government. Both in December and last January, the consumer price index registered an increase of 4%, that is, it is at an annual rate of 60%, twice the goal established in the budget (29%). [19659002] Worse still, food has been rising at a faster rate (75% per year), particularly affecting the consumption of the sectors with lower incomes, that is, those that allocate a greater proportion of their budget to food.
The forecasts of the consulting firms for the current month anticipate a variation in retail prices of the order of 3.2 to 3.5%, that is to say somewhat lower than in January, but equally high.
The Central Bank slowed down the pace of sales this month. update of the official dollar, in what is interpreted as a first response to the inflationary problem, trying to contain the change to prices of the exchange rate adjustment.
Deterioration
The discussions in the sectoral tables will take place in a complex context, marked by the marked deterioration suffered by wages in recent years and business claims for adjustments in prices regulated by the Government .
The purchasing power of formal workers suffered a loss of 17.5% between 2018 and 2019 as a consequence of joint ventures that did not anticipate the inflationary accelerations that occurred in those years. At the beginning of his government, the Frente de Todos tried to reverse the situation with fixed-sum increases established by decree. Thus, the blank salary grew almost 14% (double that of inflation) during the first quarter of 2020, but "the arrival of the pandemic and the quarantine ruined any attempt to recover the real salary," says Ecolatina. In sum, last year added a new deterioration in the purchasing power of workers of 3%, according to this consultancy.
In the first quarter of the year, historically, joint negotiations were resolved. Currently, talks are difficult not only because of the magnitude of the wage decline, but also because of the sharp setback that the economy suffered last year in the context of the pandemic. With the aim of preserving the purchasing power of the sectors with fewer resources, an alternative that is being considered in the Government is raising the minimum wage, according to a high official source to Ámbito. [19659009] In turn, businessmen complain about what they consider a delay in updating prices regulated by the State. In this sense, the president of COPAL, Daniel Funes de Rioja assured that "food is not the cause but the consequence of inflation" and gave as an example that in 2020 inflation reached 36.1% "and by decision of the Government, food rose between 4 and 10%".
Another aspect to take into account is the adjustment of public rates. From the Palace of Finance an average increase is contemplated in line with the price increases foreseen in the budget, but other sectors of the Government consider that the increases should be, at most, 9%.
As an example, from the toll concessionaires it is argued that the increases should be around 70% to bring the accounts back into balance. Since official sources rule out the possibility of achieving a recomposition of this magnitude in the course of the year.
In the immediate term, the Executive Branch is studying policies from “segm ent " of the settings. According to the reports, the sectors with lower incomes would not suffer tariff increases, while the adjustments would be greater for sectors with high purchasing power. In the same way, the rate corrections would be lower for SMEs compared to large companies.
On the other hand, it is expected that, in the coming days, the Chamber of Deputies will make the modification of the regime a law. Defense of Competition granting greater regulatory powers to the authorities . From the Executive Power studies are already being carried out on the sectors in which there are cases of concentration of supply as advanced in official sources.
Prices and wages will be one of the topics that this will deal with. Wednesday, the Economic Cabinet, headed by the Chief of Staff, Santiago Cafiero . In addition to Kulfas, the Deputy Chief of Staff, Cecilia Todesca ; the Ministers of Economy, Martín Guzmán and of Labor, Claudio Moroni ; the president of the Central Bank, Miguel Pesce and the director of the AFIP, Mercedes Marcó del Pont.
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