Argentine government returns to “freeze” prices of thousands of products in the face of uncontrolled inflation

RIO DE JANEIRO, BRAZIL – In October 2021, Argentina’s government announced a 90-day price freeze on some 1,500 mass consumer products. The measure sought to curb inflation and met with resistance from business sectors.

And this Wednesday, January 12, the Argentinean government announced the renewal of the previous measure, known as the “Precios Cuidados” (Cared Prices) program.

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The administration of Alberto Fernández reached an agreement to maintain fixed prices with more than 100 companies producing mass consumer goods so that 1,321 products will integrate the new list of the “Precios Cuidados” program, according to the official statement.

According to the statement, the program will be in force annually with a quarterly review, according to which the first stage will be in force until April 7 and contemplates a 2% monthly average increase in prices for all products.

INFLATION

The launching of the new basket of “Precios Cuidados” takes place shortly before the inflation for December 2021 is known this Thursday.

Inflation, Argentina’s historical problem, reached 51.2% year-on-year in November 2021, and in the food and non-alcoholic beverages division alone, prices rose 50.5% year-on-year.

The result of a voluntary agreement between the State, manufacturers, distributors, supermarkets, and wholesalers, the “Precios cuidados” program emerged in 2013 at the initiative of the government of Cristina Fernández (2007-2015), current vice-president, which the conservative Mauricio Macri (2015-2019) maintained and the executive of Alberto Fernández relaunched with its strategy, which included last October ordering a price freeze on more than 1,400 products until January 7 last year.

According to the official statement, in 2022, the new list of “Precios Cuidados” doubles the number of agreed products that made up the last basket and includes grocery, cleaning, bookstore, perfumery, personal care, and hygiene, baby and pet products, fresh products (dairy products, cold cuts, fresh pasta, empanadas, and pie covers), frozen products and beverages, among others.

This last stage of negotiations to renew “Precios Cuidados” between the companies and the Secretary of Domestic Trade, in charge of Roberto Feletti, started December 13. Since the beginning of this week, the companies that are part of the new stage of the program began to sign an “Act of Agreement” through which their participation is formalized.