Tuesday, April 7, 2020

ECONOMY | 24-04-2019 01:30

Government's price-cap scheme faces delays, with some products unavailable

The Macri government's decision to implement the price-cap scheme drew criticism last week, as the 2019 electoral season heats up and the government struggles to improve the negative perceptions among voters over its handling of the economy.

Consumers wanting to benefit from the national government's roll-out of price caps on basic food items can expect delays, Argentina's consumer defence commissioner confirmed Monday.

Supermarket bodies reported that only 70 percent of the listed items were available on Monday, the programme's official start date.

The list includes milk, teas, biscuits, yogurt, deserts, oils, sugars, rice, past and flour. Three cuts of red meat are also subject to a price cap, at 149 pesos per kilo, but not as part of the "Price Watch" (Precios Cuidados) scheme.

The Mauricio Macri administration's decision to implement the price-cap scheme was made public last week, as the 2019 electoral season heats up and the government struggles to improve the negative perceptions among voters over its handling of the economy.

"The Secretary [of Commerce] indicated that of those listed some items are still in production and will arrive later," representatives from the supermarkets chamber told Perfil.

The director of the country's consumer defence body, Fernando Blanco Muiño, said Monday that "all" 64 products will be available by Monday.

"The issue was with logistics to get all the products to the point of sale", he told La Red radio.

While in some supermarkets the number of missing products is eight, in one major chain it reaches 15 – in other words, only 40 of the listed 64 products will be available – sources from that supermarkets reported.

The government's "Price Watch" (Precios Cuidados) scheme will run for 180 days, through to the October general and presidential elections. The Macri administration was widely criticised for the implementation of the programme, with opponents suggesting it was akin to price control measures of the government of former president Cristina Fernandez de Kirchner.

In some instances, supermarkets have never distributed products from the brands listed in the government "Price Watch" scheme, they reported. These products could take 10 days to arrive to stores.

The programme formally begins on April 22. However, supermarkets have until April 29 to fully comply with its requirements.

Consumer defence groups will meet Domestic Commerce Secretary Ignacio Werner this week to discuss the tax implications of the programme, Perfil reported.


The government will also move to pass, by decree, a law surrounding fair trade with a focus on tackling misleading publicity and in-store pricing that does meet the real price of a product.

Fines will range from 20-200 million pesos (US$480,000 to US$4.8 million), rising from the current 5 million pesos, according to the type of infringement and its affects.

Existing legislation requires perpetrators to pay the fine before the appeals process. The new law, however, does not. Instead, if the accused does not appeal they will receive a 50 percent reduction in the fine.

Products included in the programme will bear the existing "Precios Cuidados" label as well as a red band identifying them as "essential."


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