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ARGENTINA | 18-03-2022 21:50

What we learned this week: March 12 to 19

A selection of stories that caught our eye over the last seven days in Argentina.

 

IMF DEAL APPROVED

The Senate on Thursday gave final approval to the government’s agreement with the International Monetary Fund (IMF) to reschedule the debt of US$44.5 billion inherited from the Mauricio Macri administration. All 72 senators were present for the vote, which went 56-13 in the government’s favour with three abstentions. All 13 votes against came from the caucus of the ruling Frente de Todos coalition with the Juntos por el Cambio opposition voting unanimously in favour. Vice-President Cristina Kirchner vacated the premises just two minutes after the start of the debate.

 

CRISTINA’S CONSPIRACY

At the start of the week Vice-President Cristina Kirchner uploaded onto her social networks a new video of the March 10 attack on her Senate offices in the context of demonstrations against parliamentary approval of the agreement with the International Monetary Fund (IMF), claiming that the video showed the attack to be carefully planned. Meanwhile Buenos Aires provincial minister Andrés ‘El Cuervo’ Larroque continued to criticise what he perceived as government silence on the issue. Last Monday eight youths participating in the attack were identified via security cameras and Security Ministry software. One of the octet was arrested on Wednesday.

 

INFLATION SOARS

Argentina posted the highest inflation in Latin America with the 4.7 percent announced for February by INDEC national statistics bureau last Tuesday, well ahead of Venezuela’s 2.9 percent last month. Inflation thus totals 52.3 percent for the last 12 months and 8.8 percent at this early stage in the year. The key food and beverages item was especially alarming at 7.5 percent, the worst figure of all. Core inflation, which weeds out seasonal and regulated prices, was 4.5 percent.

The presidential reaction was to announce a “war on inflation” starting yesterday, immediately following the completion of parliamentary approval of the agreement with the International Monetary Fund (IMF).

 

AGRI AGRO

Early in the week presidential spokesperson Gabriela Cerruti sought to defuse the discontent of the farming sector by denying that grain export duties would be increased, saying that the government was exploring other means of preventing international prices from being transferred to the domestic market such as price ceilings or subsidies, but the main agricultural lobbies were not convinced. Cerruti said that the presidential decision followed a meeting with Agriculture Minister Julián Domínguez. Apart from the fears of higher grain export duties, the farming sector was also irritated by the government decision last Monday to ban the export of soy flour and oil, expressing its “total rejection” in a communiqué while Cabinet Chief Juan Manzur said that he would be in “permanent contact” with provincial governors to monitor the situation in the light of harsh criticisms from Córdoba’s Juan Schiaretti and Santa Fe’s Omar Perotti as well as City Mayor Horacio Rodríguez Larreta.

 

MARKET WATCH

The “blue” parallel dollar closed the week yesterday at 202.5 pesos, showing continuing calm from the progress of the agreement with the International Monetary Fund (IMF) following the previous day’s Senate approval. Meanwhile the official exchange rate rose during the week to 114.50 pesos yesterday, as quoted by Banco Nación, continuing this month’s acceleration, or almost 189 pesos if the 65 percent surcharges for savers are added. The parallel but legal exchange rates of the CCL (contado con liquidación) and MEP (medio electrónico de pagos) retreated further below the 200-peso mark, closing the week at around 195 and 194 pesos respectively. Country risk closed the week at 1,795 points, registering a downward trend in relief over the final approval of the IMF agreement in the Senate but still above this month’s lowest levels. 

 

ISRAELI ATTACK ANNIVERSARY

The 30th anniversary of the terrorist bomb destruction of the Israeli Embassy was commemorated at the scene of the crime last Thursday with tributes to the 29 fatal victims and the presence of the Justice ministers of both countries (Martín Soria and Israeli deputy premier Gideon Sa’ar) among others. 

 

NOT SO RESILIENT

A "Unit of Argentine Resilience" under Fernando Melillo (a former disciple of Civic Coalition leader Elisa Carrió) came and went in the course of less than 24 hours at the start of the week in what some saw as the first austerity move in the wake of the agreement with the International Monetary Fund (IMF) approved by both houses of Congress in the past week. Malicious opposition critics compared the new creation, whose functions will now be assumed by the Health Ministry, with Venezuela’s Ministry of Happiness. The notion of "community resilience" was first conceived last May and included the creation of a "virtual library" to make people more upbeat.

 

MINIMUM WAGE HIKE

The Minimum Wage Council unanimously defined on Wednesday a 45 percent increase for the pay floor in the course of this year, taking it up to 47,850 pesos by Christmas with a 28 percent increase in the second quarter through to midyear (when the increase will be up for review, as well as in August) and a 17 percent increase thereafter.

 

MACRI JETS OFF

Ex-president Mauricio Macri, facing illegal espionage charges and currently abroad until next Monday, was granted permission by federal judge Julián Ercolini to travel to Spain, Italy, Qatar and the United States between March 25 and April 9. Macri’s commitments abroad include a bridge tournament in Parma. 

 

NEW MALVINAS GOVERNOR

Outgoing Falkland Islands Governor Nigel Phillips will still be Britain’s local face on the disputed islands for next month’s 40th anniversary of the 1982 South Atlantic war but in July he will be replaced by Alison Mary Blake, Her Majesty’s Ambassador in Afghanistan until last year and the first female governor of the Malvinas.  

 

BORIC PLANS VISIT
On his first working day in office, Chile’s new President Gabriel Boric, 36, told a press conference that his first trip abroad next month would be to Argentina while adding that his approach to regional integration would not be based on ideological affinity so as to give Latin America a single voice in the world. Thus he proposed that the problem of over six million Venezuelan emigrants should be absorbed by all the region’s countries.

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