Buenos Aires: Austerity measures in Argentina sparked mass strikes this week, forcing trains to come to a screeching halt and hospitals to remain operating amid exhaust fumes, even as the country boasts its first budget surplus in 12 years. Ta.
It’s been more than two months since Liberal President Javier Millay took office promising to cut spending, but his deep cuts are damaging and, as he warned, so far The economic situation of the people is deteriorating.
Annual inflation has reached 254%, and bus ticket prices have more than tripled since Millais stripped away hefty transport and fuel subsidies.
“Now I know what it’s like to walk,” Janina Sarto, a 42-year-old domestic worker who used to make four round trips a day between jobs, told AFP.
Medical costs have soared more than 300% compared to the previous year.
The government has ordered a 30% pay rise by March, far below the 85% demanded by unions, and strikes are on the rise.
On Wednesday (February 21), train drivers destroyed tools, and on Thursday, public and private health workers went on strike, with only hospital emergency rooms expected to be functional.
Teachers are calling for a strike ahead of the start of school next week, and the country’s main trade union CGT is discussing another nationwide strike.
“Social conflicts will continue to escalate,” warned CGT union secretary Pablo Moyano. “Unfortunately, this is going to end badly.”
Mr Millais said when he took office that there was “no money” and vowed to end the “decades of decadence” of his spendthrift predecessors, marked by repeated inflationary crises and debt.
The 53-year-old self-proclaimed “anarcho-capitalist” has devalued the peso by more than 50%, cut tens of thousands of public jobs and cut the size of the government in half.
However, the government is expressing optimism and touting its achievements.
“Even if you hit rock bottom, you always get back up,” Millay said.
In January, Argentina reported its first monthly budget surplus in 12 years, increasing the country’s meager foreign exchange reserves from US$21 billion to US$27 billion (RM100.2 billion to RM128.8 billion).
Romano Group economist Salvador Vitelli said the “abnormal fiscal result” was explained by a 39.4% decline in spending due to cuts in pensions, subsidies and salaries.
Millais’ government has been praised by the International Monetary Fund, which owes US$44 billion, for its “bold actions to restore macroeconomic stability.”
On Thursday, IMF Deputy Managing Director Gita Gopinath visited the country for two days and held what she called “excellent substantive talks” with Milay about “the best way to move the country forward.” did.
Despite spectacular year-on-year inflation, the government says inflation is being brought under control. The monthly inflation rate reached 25% in December before falling to 20% in January.
Economy Minister Luis Caputo said he expected the rate to rise close to 10% in February and reach single digits by the second half of the year.
Nevertheless, Juan Manuel Telechea, an economist at the German think tank Abdalla Foundation, said Millay’s extreme tightening measures were “extremely dangerous given the deepening of the recession and the decline in people’s purchasing power.” ” he said.
This “will test the social tolerance of an already hard-hit society,” he warned in a column for news website Senital.
Mr Millais came to power riding a wave of disgust with the previous government, led by traditional parties, which repeatedly failed to stem the country’s economic woes.
Many of those who voted for him said at the time that they had accepted that difficult times were coming.
“We have to let the president rule,” said Luis Dominguez, 47, even as he complained about the rising prices of essential goods such as milk.
“People are willing to put up with it so they don’t see the same old faces again,” said Martin Menem, president of the Chamber of Deputies.
Recent polls show Milley’s support is beginning to wane, with just under 50% having a positive opinion of the president.
But for the first time in a while, a majority of those surveyed said they expected economic conditions to improve over the next two years.
Another barometer of Argentina’s economic instability is the parallel dollar exchange rate, which has stabilized at around 1,100 pesos to the dollar in recent weeks. The official dollar is worth 882 pesos. –AFP