Government spokeswoman Gabriela Cerruti admitted that the problem of Argentina's high inflation rate will be compounded by the “new international scenario”, following Russia's invasion of Ukraine, and advocated increased withholding and the creation of the Wheat Stabilization Fund.
The official of Casa Rosada explained the unusual phrase with which Alberto Fernández announced the start of the “war against inflation”, two years after the beginning of his term. Considering that the agreement with the International Monetary Fund was to be approved last Thursday in the Senate, “on Friday there were a number of measures that could begin to be taken.” “Speaking colloquially, the President says something we were working on that Friday became the subject of the war against inflation,” Cerruti justified.
“Inflation that we had so far is not the same as what is going to begin to happen from the new international scene,” the spokeswoman warned. In this regard, recalling similar economic cycles in the country's history, he argued that “inflation is an endemic phenomenon, almost a curse”. “We have very strong inflation, which we have not managed to fall since Macri (Mauritius) left - with inflation of almost 54% - there were two years of pandemic”, and when “inflation starts to fall”, “the agreement with the IMF” is approved, and “there are macroeconomic variables that can be managed”, “the war in Ukraine begins”.
In dialogue with C5N, Cerruti pointed out that the war conflict causes worldwide “an economic catastrophe that we are already beginning to feel the consequences in Argentina”. Therefore, “the first strong measure taken has to do with the price of wheat; if we did not take the measure announced yesterday (on Saturday) by Minister Julián Domínguez, and which will be completed tomorrow (by Monday), Matías Kulfas, we were having serious difficulties in managing the price of flour and bread in the weeks that we were are coming.”
The presidential spokeswoman insisted that “the situation is serious internationally”, which is why “commodities have a huge price increase”. In this regard, despite the measures announced by Alberto Fernández on Friday, he said that “there must be new, stronger and stronger measures” to contain the escalation of inflation.
“There are producers who are having extraordinary incomes as a result of the price hike due to the war; there are 11 mega-multinational companies that can stop receiving an extra profit so that a trust can be set up to support the price of wheat, it's almost a matter of justice,” he justified.
Cerruti said that the Government will take new measures to attack inflation, since “Careful Prices and Maximum Prices, are not enough.” “The Care Prices Agreement that is in force until April 7 worked quite well in supermarkets, but not in local shops,” he warned.
“The President is going to call for a major agreement with employers, unions, medium-sized enterprises, and regional economies in order to somehow control the chain of price formation,” he said and threatened that if consensus is not reached, the government will apply “other tools, such as the Supply Act.”
Consulted by the Frente de Todos intern and the possibility of Alberto Fernández changing his Cabinet after the differences in the ruling party that deepened the agreement with the IMF, Cerruti said he had heard “nothing”. “I don't feel that we are facing a relaunch of the government,” he defined.
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