Argentine president Cristina Fernandez announced the government is prepared to make imports more flexible in those areas where a few companies have a quasi-monopoly control, but also warned about windfall profiteering.
Speaking on Thursday from Government House, the Argentine president avoided mentioning the dollar exchange rate which on Wednesday soared to a record 8.75 Pesos but underlined the significance of supporting the current agreement with the main supermarket chains to freeze prices for sixty days in an attempt to control the prices of basic consumption products.
The freeze also includes a ban on publicizing prices in the media by supermarkets as part of the overall strategy to bring down costs.
“An important chain of supermarkets reported that after cutting the huge publicity costs it not only managed an increase in sales but also in the profit margin”, said Cristina Fernandez.
However her statement on publicity costs is not shared by all the industry since promoting ‘special sales’, which helps stimulate consumption in recession periods, as has been proved, effectively needs of the newspapers.
“The hypermarkets can’t disregard publicity since for the special sales it is the only way to convince consumers to take the bus or their car and come shopping”, said Omar Bello who for many years was promotion manager for Carrefour Argentina.
Regarding the possible imports ‘window’ to ensure an abundant supply, the Argentine president anticipated that we are going to apply a system so that they don't take advantage of the differences.
She then went on to appeal to all Argentines “to take care of what we've achieved.
The current global crisis times demand us, businessmen, union leaders and workers to make a great effort, an intelligence exercise to preserve this Argentina we've achieved” stressed Cristina Fernández.
During the announcement the president was accompanied by a group of governors, mayors and several ministers. It was her first public rally since she arrived from the Vatican, where she met Pope Francis.
Argentine official annual inflation is in the range of 10% but according to private agents it’s closer to 25% and with expectations of further increasing. To counter the escalation the government or President Cristina Fernandez brokered a 60 day freeze with the main supermarket chains. But this does not ensure a fluid provision from suppliers or that prices are circumvent in other ways.