MercoPress. South Atlantic News Agency

Crucial labor negotiations week begins in Argentina

A rough week of salaries negotiations begins this Monday in Argentina involving such key sectors as metal workers, bank employees and railway personnel who have already announced demands starting at a 20% floor. Employers have offered 10%.

Metal workers last week rejected the 10% offer arguing that it does not reflect the true cost of living, an issue which is closely linked to the recent reiterated blunders committed by the President Nestor Kirchner administration in attempting to manipulate inflation figures. Another guild that promises trouble is the tire and rubber organization which belongs to another trade unions congress, Argentine Workers Central, (CTA) and contrary to the Workers General Confederation, (CGT) politically aligned with President Kirchner. They are demanding a 38% increase and a minimum equivalent to 800 US dollars per month. They can bargain strongly since the automobile industry in Argentina is booming. Bank employees are also in a good position to bargain with the financial system rapidly recovering from the 2001/02 crisis and a resurgence of consumer credit. Something similar happens with the railways engineers' fraternity who dominate the five main metropolitan lines feeding into Buenos Aires. Negotiations in the metal industry, financial services and engineers and mechanics unions are considered the most significant for the Kirchner administration since they will be lead cases for the rest of salary and work conditions talks. Contrary to last year when negotiations followed on what was agreed by the truckers unions headed by the chairman of the CGT Hugo Moyano, this year negotiations are diversified. All unions agree that the official cost of living has been "manipulated", is unreliable and if far above the 12% release (for the twelve months of 2006) from the controversial Statistics and Census Office which has been through an unpleasant and public process of beheading and staff street noisy protests. Business organizations have warned that any salaries increase above the Retail prices index will only lead to further inflationary pressures. In effect a significant share of Argentina's restructured foreign debt is linked to the evolution of the economy and the inflation index. No wonder then the turmoil in the Statistics Office and the unions demands that are anxious for a share of the four years running growth of the Argentine economy at an average 8.5% annually.