MercoPress. South Atlantic News Agency
Tierra del Fuego PC assembly industry at risk if import tariffs (35%) are lowered
A new challenge for Tierra del Fuego province and its industrial promotion scheme: the Argentina government is planning to eliminate all tariffs on the import of computers and components beginning 2017, which is estimated could cost anywhere from 4.000 to 12.000 jobs. Read full article
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Disclaimer & comment rulesWhere's the value added rg?
Oct 27th, 2016 - 12:53 pm - Link - Report abuse 0This Tierra del Fuego “industry” is an expensive but typically Argentine joke, the sort of thing Peronistas like reekie of course wildly support: it gives the unskilled and otherwise unemployable something to do, whilst creating a drain on the national treasury and adding to higher costs for consumers in the country. But it's also a way to keep Argentina backward, non-competitive, and in the darker ages of technology, since the products being assembled tend to be other than the latest models available to the civilised nations, and simpler and easier to assemble (they like to call it manufacturing but in fact it's mostly just assembly of imported parts). Phillips seems to do some actual “manufacturing” but it's mostly limited to outdated, Third World models. And production of some components can be 8 to 10 times higher than those sourced in Asia. The government regulations on importing “unfinished components” can be downright weird: if it looks too “finished” then the importer sometimes has to disassemble the item so that it can be re-assembled in Argentina under this counterproductive local-content regimen. Add to all of this a cost of about US$13 billion in “incentives” paid by the national government... out of tax monies, of course.
Oct 27th, 2016 - 02:22 pm - Link - Report abuse +3In some cases the TDF “workers” are just opening an imported box, inserting a piece of paper, and taking credit for a product as the result of “Industria Argentina.”
Oh, and the transport cost from Tierra del Fuego assembly plants to population/market centres such as Bs As province is typically higher than the transport cost for the same products coming all the way from Asia.
As noted earlier, Chile is now flooded with Argentines on shopping trips, and electronics are high on the list, because this sheltered-workshop domestic assembly ruse fails to supply the Argentine market with modern, high-quality, reliable electronic products at decent prices.
The commie doctrine at work!
Oct 27th, 2016 - 05:12 pm - Link - Report abuse 0Just like in Uruguay, kidology at it's best.
Not so much a “commie doctrine” as Peronism's process for keeping hands busy and pretending to have domestic industry. But almost all of this false industry is in some fashion just paying foreign corporations to set up plants in this countries so that the locals can touch some of the components going into foreign-branded products. There is a certain irony that Peronist Argentina initially tried to copy the Stalinist self-sufficiency model, but failed in ways that Stalin would not have permitted. In the initial Russian practice, many technologies that were not simply stolen were actually developed (though eventually there were examples of cooperation with Western industry, as with FIAT/LADA). The crudeness of Argentine copies of products from the 1950s onwards certainly reminds us of similarly crude Russian items.
Oct 27th, 2016 - 06:41 pm - Link - Report abuse +3One local shop here offered me an insight into the impacts of “Industria Argentina” on consumers. He gets engine and transmission seals from three sources: Brazilian, Argentine, and original-equipment parts from Asia. The latter are the best and generally reliable but expensive and hard to get. Brazilian, not quite as good. Argentine, well, here is the deal: Argentine-made parts have a comparatively high failure rate, and due to very high cost of labour here, having to rebuild something more than once removes any price advantage of using the Industria Argentina parts. Using junk pieces for initial assembly or repairs just doesn't pay off. Look at the commercial-carrier airlines in Argentina. There are only a handful of “technical” pieces made in Argentina that can be certified. Almost everything used in repairs for commercial aircraft in Argentina comes from outside the country. I don't know anyone who would care to travel on a plane that was repaired with Industria Argentina parts.
Blu Products is a strange case.
Oct 27th, 2016 - 08:43 pm - Link - Report abuse -1Their stated intent is to assemble cell phones in Brazil and the US from Chinese components.
President Macri doing what he does best.
Oct 28th, 2016 - 01:05 am - Link - Report abuse -3“...the Argentina government is planning to eliminate all tariffs on the import of computers and components beginning 2017, which is estimated could cost anywhere from 4.000 to 12.000 jobs.”
Marti jumps in joy. “That will teach those Kirchnerists!” (Of course, every person who loses his or her job in Argentina every day probably deserved it).
Another learning experience for the 51 per cent.
Hopefully Macaroni can eliminate a few hundred thousand more jobs misallocated by the market perversions of Cretina and her Kind.
Oct 28th, 2016 - 03:18 am - Link - Report abuse 0Reekie, ever the Peronist, safely enjoying the fruits of Canada's modern and competitive industries, continues to support the antithesis for Argentina: the maintenance of low-productivity sheltered buggy-whip workshops of dubious utility that absorb enormous amounts of public tax monies in subsidies while importing foreign components to assemble in outdated products which cannot be profitably sold in competitive markets, all to the ultimate detriment of the larger Argentine public, many of whom vote with their feet by going outside of Argentina to obtain items of decent [non-Argentine] quality and modern [non-Argentine] products to which their neighbours have access.
Oct 28th, 2016 - 03:14 pm - Link - Report abuse +3Marti demonstrates his ignorance and backwardeness by calling Peronism a “commie doctrine.“ It's not. For those who know a bit of history, Peron was deeply anti-communist and conceived his movement as a way to ensure no Socialist or Communist revolution would happen in Argentina.
Oct 30th, 2016 - 04:39 pm - Link - Report abuse 0The current government, which proposes a model in the antipodes of Peronism or any Socialist or Communist model, is quickly becoming a showcase for what a free-market, ”opening to the world” model can do to a country in a very short time even when comparing it to an imperfect government such as that of CFK.
The results of such a model are beginning to show in the numbers released month after month--in August the economy still shrank another 2.6 per cent in relation to August of 2015 (when Argentina was still being governed by vilified Peronism).
”In July, the economy fell by six percent on the year, while in June the decline had amounted to 4.6 percent. There was also a 2.6 percent contraction in May (the same as in August) and a three percent fall in April, while stagnation or very small increases were seen in the first three months of the year.”
And this is not an opinion, but numbers released by the Buenos Aires Herald on Oct. 26.
http://www.buenosairesherald.com/article/223562/economy-shrinks-by-26-percent-in-august
Reekie gets it wrong yet again! He's going for the gold now. I had in fact denied an earlier (but removed) comment by another poster who had claimed that the failed programme was part of a “commie doctrine.” We all know that Peronismo was a uniquely argentine emulation of European fascism. Perón was a great fan of Mussolini, but still couldn't make his trains run on time.
Oct 30th, 2016 - 07:20 pm - Link - Report abuse 0The debilitating effects of a long history of Peronismo in Argentina will continue to negatively affect the country's prospects for several decades, long after the current regional recession, in which Argentina is a mere pimple on a large buttocks.
Maybe Argentina should seek some economic development assistance from Perú. I hear that in spite of the regional downturn, Perú is expecting to end 2016 with almost 4 percent annual growth. Did you know that international investors trust Perú and its institutions a great deal more than they trust Argentina? Care to guess why no sensible investor trusts Argentina?
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