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Alpargatas closes Chaco factory, lays off all workers, sells facilities

Tuesday, November 6th 2018 - 14:30 UTC
Full article 4 comments
 Alpargatas took another step towards withdrawing from Argentina. Alpargatas took another step towards withdrawing from Argentina.

The clothing firm Alpargatas shut down its factory in the Argentine province of Chaco, it was reported Monday. The company made it clear it was not a temporary measure by laying off the entire staff and placing the facilities on sale. Further closures and subsequent dismissals nationwide look imminent.

 The Brazilian capital company closed its plant in the city of Roque Saenz Peña, 170 kilometres from the provincial capital Resistencia, due to a sharp drop in demand. There were only still 30 people working because the firm had already been carrying out drip dismissals, in line with its general strategy of withdrawal from Argetina.

In mid-September, Alpargatas had asked the national government for the Preventive Crisis Procedure and sold 22.5% of the local operation to the Brazilian group Sforza.

Days later, the firm confirmed the closure of two production plants: 'Calzados Catamarca', where it dismissed 170 workers; and 'Alpargatas' (Ex Calzar) in the city of Santa Rosa, where 132 workers lost their jobs.

In this scenario, 400 workers fear for their jobs at the still operational plant in Bella Vista, in the province of Corrientes, because “there is no reactivation whatsoever,” according to Roberto Vandecaveye of the Corrientes Textile Workers' Association.

He added that work at the plant is kept at a minimum “from Monday to Friday, with very little activity, machines stopped and sectors without lights, which is worriesome.”

Dante Quintana, of Chaco's Trade Union of Oil Workers and Cotton Ginners (Stadyca), explained that “this Saenz Peña plant is the only one the company Alpargatas had in Chaco, which they bought 65 years ago from Fibramalva.”

Quintana also admitted the workers had been warned that “by the end of the year they close everything, they sell and they leave Chaco.” The closing of the plant is “a very strong socio-economic blow for Sáenz Peña,” the second largest city in the province, Quintana lamented.

“The money from these salaries will stop circulating in the local commercial circuit and any severance money will go first to pay up debts and the rest remains to be seen,” Quintana explained.

The union leader said that the closure of the plant responds to the sharp drop in activity: “This year, 3,700 tons of cotton were ginned, when in 2017 it had been 20,000 tons and in previous years more than 40,000 tons per year.”

“This goes through the impressive fall in domestic consumption of clothes, yarns and fabrics. It is not that there is no cotton, there was a lot and there will be more in the next season; but the company only gins what it needs for its spinning mills; and as sales have fallen steeply, we reached this unfortunate end,” he said.


Categories: Economy, Investments, Argentina.

Top Comments

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  • Zaphod Beeblebrox


    “Welcome to post-truth politics.”

    As I have mentioned before, there are many aspects of the Argentine economy that are very bad, but some are improving. So, I acknowledge the bad bits but provide data to demonstrate the good bits too. Meanwhile, you ignore the good bits and only highlight the bad bits (and blame them all on Macri). What were you saying about post-truth?

    Also, this is a Brazilian firm that is pulling out of Argentina. I thought you didn't like foreign companies operating in Argentina so shouldn't you be happy about this news or do you now accept that foreign investment in Argentina is a good thing?

    ”However, the government, his friendly media and some MP posters attempt to keep the focus on “how bad” the previous government (that ceased to exist almost three years ago) was.“

    You invite such comparisons every time you use phrases like ”under the government of Mauricio Macri“ or ”under Macri’s watch”.

    Nov 07th, 2018 - 06:09 pm +3
  • Zaphod Beeblebrox


    “Industrial activity has fallen 11.5 per cent in September”

    Again, you cherry-pick some data that supports your view but miss the wider picture.

    1. Pretty much all economic activity is seasonal so comparing one month to another is meaningless;
    2. When you look at the data for GDP from manufacturing you see the seasonal effect I mention in 1, but also the trend has been increasing for the last 2 years; and
    3. Industrial activity is just one component of the Argentine economy.

    “For the general population, things are getting real tight under the double whammy of increasing prices and vanishing purchase power. As a result, trust in the government is at an all-time low as shown by several opinion polls.”

    Yes, adapting to the harsh realities of economics can be painful. The UK did that in the 80s but emerged much stronger for it.

    Nov 09th, 2018 - 06:08 pm 0
  • Enrique Massot

    Zaphod valiantly comes forth and, while he concedes many aspects of the Argentine economy that are very bad, “some are improving.”

    You've got to acknowledge his courage for still coming to the defense of the Macri government. Not many do these days anymore.

    Unfortunately, nobody has seen the 'green shots' Zaphod seems so fond of. Industrial activity has fallen 11.5 per cent in September, and the levels are the worst of the last 10 years. The Argentine Industrial Union is alarmed and has told the government how dire the situation is.

    For the general population, things are getting real tight under the double whammy of increasing prices and vanishing purchase power.

    As a result, trust in the government is at an all-time low as shown by several opinion polls.

    The IMF loan was given to Macri so that he could make foreign debt interest and principal payments - not a dollar for other things. The IMF requirement that the government runs zero deficit will only increase the current recessive conditions of the economy.

    But as Zaphod says, there are some good things in the midst of it all. Banks are pocketing unprecedented gains. Government officials, who have their assets abroad, are participating in the “timba financiera” and making more money. The large mining corporations - mostly foreign - are making a kill in the absence of export taxes.

    But hey, there is not much room in Paradise. Just for the few chosen ones.

    Nov 07th, 2018 - 09:03 pm -3
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