This Monday the business world took the devaluation of the official exchange rate by surprise. Faced with this situation, many decided to withdraw their price lists and not make new deliveries of products while waiting for definitions.
“We have no price, we are not delivering, we only sell in dollar bills,” are some of the phrases heard yesterday by businessmen who picked up the phone to contact their suppliers. Waiting for definitions to mobilize stock, once again Uncertainty paralyzed operations in industry and construction. In mass consumption, the firms await a new summons from the Ministry of Commerce to discuss the continuity of the Fair Prices program. In the Government they argue that business margins are high and that they can absorb the cost of the devaluation.
This Monday morning, the businessmen and women of Argentina had not been able to digest the surprise of the electoral result, when they had breakfast with a 22% devaluation of the official exchange rate that brought the wholesale price to $350. Official sources confirmed to Ambit that the 7.5% tax surcharge that had been applied to imports weeks ago will be maintained. So, specifically, for those who depend on foreign inputs, the jump has exceeded 30% in recent weeks.
The uncertainty scenario had immediate repercussions in industry and construction, where operations are virtually paralyzed. Many suppliers do not take orders, others do so without a price or delivery date and some accept them under the condition of setting the price to dollar bills. The affected products are of the most varied: chemical inputs, metals, electrical elements, control panels, household appliances.
Volatility has become customary in recent years. Among small and medium-sized companies, they take it for granted that everything will be paralyzed for a few days, until the situation settles down and some equilibrium point is found for prices and parallel dollars. “It was a typical Monday of correction of variables”, explained to Scope Leandro Mora Alfonsineconomist specialized in manufacturing industry and productive development.
Once the devaluation jump was finalized, the Government let it be known that, given the high level of margins, companies are in a position to absorb the new official exchange rate without having to carry out further remarks. Although, specifically, the consultancies that measure inflation week by week observed an almost immediate impact weeks ago when imports became more expensive via the PAIS Tax.
Fair Price Renewal
For now, during the next few days the Secretary of Commerce will have a new round with the mass consumption firms for the renewal of Fair Prices. “The program continues. We are working on measures to provide predictability in prices, which adjust to reality and avoid abuse. The companies are being summoned in the next few days to work in this regard, ”they explained from the office that leads Matias Tombolini.
In the sector they say in a low voice that at least the impact on costs will be 9%, but they also assure that they already had the “backward” prices along the path set by the official program for practically all mass consumption products, which until now has been below the inflation average. But of course, since price control only reaches large supermarkets, the gap with local businesses also widened.
If before the devaluation, the Economy expected to collect close to an extra point of GDP due to the tax devaluation, with the jump in the official exchange rate that will grow even more. Will there be any income policy? Will it include a new salary floor or a lump sum to compensate employees? These are questions that still resonate among those who have to make the decision to go out again to sell their products and at what price to do so.
Source: Ambito
