Seven out of 10 industries fear for imported inputs

The Argentine Industrial Union (UIA) reiterated its claims about the obstacles to the importation of inputs that are causing production problems in different branches and endangering the normal functioning of companies. Seven out of 10 firms state that “difficulties in the supply of inputs could generate stoppages in some production lines,” according to a survey carried out by the entity among its associates. “The non-approval of the applications and the delay in the deadlines were the reasons most highlighted by the companies as risks of partial stoppages of plants,” he added.

According to the survey, almost 40% of the companies indicated that imported inputs “represent between 25% and 50% of their production costs.” Meanwhile, for 20% of the companies these represent more than 50% of the costs while for the remaining 40% they mean less than 25%. The UIA maintained that “the increase in payment terms for imports under the new system aggravated the problems in obtaining financing for imports from companies.”

According to the entity’s report, “almost 90% of the companies indicated that they have difficulties obtaining the necessary financing to import inputs according to their flow of operations.” The business representation also questioned the current .

System of Imports of the Argentine Republic (SIRA) and maintained that “more than 80% of the companies indicated that the deadlines for approval of applications with the new system are longer than with the previous system.”

The UIA warning coincided with other data that this week revealed that consumption will have signs of cooling off due to high prices.

The level of consumption fell 3.5% year-on-year in the country during 2022 and the drop was more pronounced in the Buenos Aires Metropolitan Area (AMBA) than in the interior.

The data comes from a survey carried out by the consulting firm Focus Market, which specified that during December, retail sales of goods in general grew 2.7%, favored by the Fair Prices program and income recomposition with an increase in minimum wage, retirements, bonuses and reinforcements in social programs.

“Interannual inflation data show that price variations in our economy present the biggest problem in the last 32 years. With the same nominality, consumers are buying fewer and fewer products,” said the director of the consultancy, Damián Di Pace.

According to relevance, in 2022 consumption was similar to the previous year in supermarkets, while the rest of the marketing formats showed falls.

Regarding the basic basket, the report showed that during the last month of 2022 its prices increased by 6.3%, driven by drinks and cleaning supplies. In the “x-ray” of the consumption of Argentines, frozen foods, flour, sausages and drinks grew; sales of personal care items also recorded a certain recovery.

“The pockets of Argentines have different situations: registered wage earners earned on average against inflation in the last two months, but lost in the entire accumulated year. The unregistered who are the ones that grow the most in volume -such as monotributistas and self-employed- but cannot sustain their standard of living with enormous tax pressure and income liquefied by inflation. In the case of informal workers, the situation is even more serious,” said Di Pace.

You may also like