From 16 of this month, the Secretary of Commerce will summon the companies to renew the program Fair Prices which expires this month, such as advance Scope. The new conditions that will govern the voluntary agreement include the analysis of the impact on the cost structure of companies as of Decree No. 377 dated July 23 of this year, which established a new, higher exchange rate for the exports of some regional products and the COUNTRY tax for the importation of goods and services.
The National Directorate of Policies for the Development of the Internal Market carried out “a detailed analysis in which It was determined that the impact that the rates applied to the products reached by the (PAIS tax) for the mass consumption sectoris a weighted average of the 1.2% Likewise, the Secretary of Commerce will provide companies that sign the Fair Prices agreement with tools that “substantially improve the cost of financing imports.”
The official intention is to achieve “a reduction of financial costs that allows to compensate the marginal increase in the structure of direct and indirect costs derived from the application of the new liens”.
Another of the measures in this portfolio will be the establish “an aggressive working capital financing mechanism for SMEs that allows to improve the offer of products in gondola”, with the purpose of promoting greater competition and improving the supply chain.
The new Fair Prices scheme that will begin to be in force as of August 19, “will promote innovative control mechanisms, which will be integrated into traditional models with the use of technological tools to monitor compliance with the voluntary agreements signed.” The Secretary of Commerce in a first instance It will convene companies that supply and market basic basket products offered in wholesale stores, local stores, and supermarkets.
transfer to prices
In the negotiations for the new Fair Prices agreements, the authorities will surely make use of a series of studies that, in the official opinion, show that companies have margin not to raise prices.
A study carried out by the Department of Policies for the Development of the Internal Market of the Ministry of Commerce “shows that the 36 mass consumption companies which represent 72% of national consumption (food and beverages, personal care and household cleaning), they had variations of between 0.1% and 4.3% in their cost structure”.
Likewise, that the additional 7.5% that must be paid in the importation of non-excepted inputs It does not have a significant impact on the cost structure of companies. Thus, the Secretariat concludes that the transfer to prices of said measure should not be significant.
The methodology consisted of analyzing: “the scope of the measure taking as data the average time that companies have to access foreign currency, production costs and imports at average prices for each year,” they explain. It was calculated on the impact on the costs of inputs imported by the companies, as well as imported inputs purchased locally.
margins
With a inflation that it is already known that in July it will show, according to private calculations, levels above 7% and that in August it is estimated that it will also continue at that level or higher, the government carried out a study of business margins. According to the work carried out by the Secretary of Economic Policy, in charge of gabriel rubinsteinin recent years, the increase in Gross Business Marginshas been very marked, going in the total CPI, from values of 25% in 2017 to more than 46% in the months of April to June 2023.
The technicians of the secretariat have been analyzing the evolution of the Gross Business Margins (MEB), from the CPI data published by INDEC. This estimate comes out as residue of the calculation of costs in the CPIwhere variations in international prices, the official exchange rate, and wage costs are considered.
“Despite the fact that the vast majority of companies have access to the official dollar (MUCL) to pay for imports, the persistence of a very high exchange rate gap has made it easier for many companies, with or without problems accessing the MULC, and with or without problems of access to the longer financing terms of the same, have found room to raise prices beyond their true costs and normal profit margins. affirms the work of the Ministry of Economy.
in government judgment “This creates an opportunity for anti-inflationary policies that allow such margins to be lowered, without affecting real wages or the competitiveness of the peso”. In the case of Food and Beverages, the margin exceeds 40%, while for goods and services for the home, as well as automobiles, it exceeds 45%.
Source: Ambito
