Massa discusses peso devaluation with economic team

Minister of Economy and presidential candidate for the Unión por la Patria, Sergio Massa gathered his economic team and other senior government officials over the weekend to discuss a set of measures to deal with the impact of the devaluation of the Argentine currency. In the package, possible adjustments in wages and price controls.

During the meetings, aimed at meeting with representatives of the IMF (International Monetary Fund) on Tuesday (22.Aug.2023), they evaluated the economic situation of the country after the change in the official exchange rate and the increase in the interest rate. They also discussed increasing the “Dolar blue”, which reached 780 pesos, but ended the week at 720 pesos. The information is from the website infobae.

On Saturday (19.Aug), the meetings began around 10 am in the Belgrano Hall of the Ministry of Economy. In addition to Massa, were present:

• the deputy chief of staff, Juan Manuel Olmos,
• the president of Banco Nación, Silvina Batakis,
• the secretary of Industry and Productive Development, José Ignacio de Mendiguren,
• Secretary of Agriculture, Livestock and Fisheries, Juan José Bahillo and
• the director of Customs, Guillermo Michel.

With the aim of mitigating the effects of the devaluation of the Argentine peso, economists evaluated measures for industry, small and medium-sized companies, as well as for the agricultural sector to stimulate consumption affected by the increase in prices.

The Government’s central plan to deal with the devaluation will be to approve the addition of a fixed amount to wages that complements wage negotiations already resumed by some workers’ unions.

In response to the inflationary impact on consumers’ daily lives, the Ministry of Economy initiated meetings with wholesale and retail supermarket chains operating in Argentina, including Dia and Carrefour, who agreed to limit price increases to 5% per month.

Restrictions on price increases will only apply to products sold under the stores’ own brand. Companies that do not comply with the agreement will be penalized and will lose tax benefits.

Another measure presented by Massa’s economic team is an initiative to encourage the regularization of workers who are currently in informality.

The Secretary of Energy, Flavia Royón, also said that “there will be an adjustment” in electricity tariffs after a study on “how devaluation affects the cost of generation” is performed “next week”.

This was the 1st economic policy movement by the ruling party after the result of the Paso (Primary, Open, Simultaneous and Mandatory) on August 13th. In the poll, Massa’s coalition came in 3rd place, behind libertarian candidate Javier Milei and the union of Patricia Bullrich and Horacio Rodríguez Larreta, from the alliance Juntos por el Cambio. In individual votes, the minister was in 2nd place.