Argentina launches price reporting system to deal with rising inflation
RIO DE JANEIRO, BRAZIL – The consumer price index in Argentina was 36.1% in 2020, a figure that, although lower than the 53.8% of 2019, consolidated the country as the Latin American country in which the prices of the family basic basket grow second fastest, after Venezuela.
To fight inflation and avoid shortages, the Government created a system that establishes that all large companies in the commerce and industry sectors must report each month what they sell, as well as the quantity and its value.
This is the Information System for the Implementation of Economic Reactivation Policies (SIPRE), which during the first days of each month will collect the data of the products, the unit price, the quantities produced and sold, the report in case of shortage and the shortage or non-delivery of inputs necessary for their production.
The regulation applies to those construction companies that invoice more than 1 billion Argentine pesos per year (US$1.1 million at Thursday’s exchange rate), 2.6 billion pesos in the trade sectors, and 2.5 billion pesos to those engaged in industrial activity.
The objective is, according to the Executive, “to prevent shortages and protect the rights of consumers”. But there are those who consider that this is an inaccurate statement.
Gustavo Neffa, economist and director of Research for Traders, stated that “in Argentina they already tried it in 2014 with the public utilities companies to see how much they earned and to be able to fix their tariffs. And what it did was to discourage investment.”
In recent weeks, the government has sanctioned several of mass consumption companies for withholding production volumes or failure to deliver certain products for their commercialization.
The truth is that, for the Argentine government, inflation, which in February was 40.7% year-on-year, is “a multi-causal problem”. While for this year it seeks to lower it to 29%, private analysts consulted by the Central Bank foresee a price increase of 48.1%.
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