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Days after the Argentine president Alberto Fernández declared the “war against inflation”, the Minister of Productive Development, Matías Kulfas, announced the first actions to control the rise in prices that took the indicator, during the month of February, to 52 .3% year-on-year. The authorities hope that through dialogue an understanding will be reached with the businessmen, but they do not rule out taking severe measures if a consensus is not achieved.
Among the first measures announced by the Government is the establishment of subsidies to the mills, which process the wheat for the production of flour, with the aim of reducing the price of bread and other products derived from this raw material.
Kulfas pointed out that the measure was driven by the increase that wheat flour has shown in recent days due to the increase in the international and domestic price that the raw material has shown in the midst of the conflict between Russia and Ukraine.
“We are generating a mechanism to guarantee that bread will not be lacking on the Argentine table,” the minister said.
From the National Government we take care of the bread on the Argentine table so that the rise in prices due to the war between Russia and Ukraine does not spread to our country.
We want to consolidate the economic recovery so that it reaches all households.#LowerInflation pic.twitter.com/bwD5u5EjcS
– Matías Kulfas (@KulfasM) March 21, 2022
To carry out this measure, the Government of Alberto Fernández will create a trust that will provide the resources for the subsidies to the mills and with this, without affecting the price they pay the producers, the value of the flour is close to the prices that I had in February.
“Food prices were unexpected and out of proportion”
One of the items that presented a higher inflationary rise during the month of February was food, whose increase was around 7.5% in that period.
Given this, Kulfas indicated that the Executive is studying the establishment of a measure similar to the one taken for derivatives of wheat flour, in order to stabilize the price of fresh food products.
On the other hand, the head of the Productive Development office charged against the businessmen, who were granted a period of 24 hours to justify the increase in prices that “were unexpected and out of proportion.”
In this period, the authorities hope to determine the extent of the responsibility of the food industry, intermediaries and supply chains in the price increase.
“All those increases that have been adopted in an unjustified manner have to be brought back to the schemes of March 8 and 9 that have to do with the Care Prices schemes,” Kulfas said.
Brazil announces elimination of tax on ethanol and six foods to combat inflation
In the region, another country that is looking for alternatives to control high inflation is Brazil.
There the Ministry of Economy announced that the import tax on ethanol and six other foods such as: coffee, margarine, cheese, pasta, sugar and soybean oil will be eliminated.
These measures, which will continue until December 31 of this year, were announced with the aim of “alleviating the inflationary pressures resulting from the pandemic context by Covid-19 and aggravated by the conflict between Russia and Ukraine”.
🚨 FURTHER TAX REDUCTION
In order to alleviate the effects of inflation caused by the “date all” in the whole world, or the Federal Government zeroed, before or until the end of 2022, or the import tax on food and also on ethanol pic.twitter.com/FCQGkgjRuJ
— SecomVc (@secomvc) March 22, 2022
In February, inflation presented an upward increase of 0.56 percentage points to settle at 1.1% on a monthly level, reaching a rise of 10.5% on a year-on-year level in that period.
With EFE and Argentine media.
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