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Monday, May 27, 2024

Argentina. Massive inflation. Every fourth person lives in poverty

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High prices hit the Argentines hard in the pockets. The country’s annual inflation rate was almost 109 percent, one of the highest in the world. Politicians are fighting to lower prices ahead of the elections, which will take place in a few months, but there is no improvement in sight. Argentina is losing the fight against inflation.

Argentina is sinking into an ever-increasing crisis. Every fourth citizen lives in poverty. Queues of people in need form outside a diner in Buenos Aires. On the outskirts of the capital, people are digging through a landfill, hoping to find something to sell. “It’s a shame that our country is in this situation. A man despairs because after working all his life he has to fight for a tomato or a pepper. Politicians have destroyed us. They have turned our country into a state of beggars, believes Carlos Andrada, a resident of Buenos Aires.

Within a year, prices increased by 109 percent. Inflation in Argentina is at its highest in three decades. According to scientists from the University of Buenos Aires, it could be even worse. Economists say that at the current rate of increase in food prices, the annual inflation rate could reach 197 percent. The Argentines are wringing their hands. – Until recently, I paid 300 pesos for a kilo of peppers. Now I have to pay the same for half a kilo. Apple prices have also gone up. What should retirees do in this situation? asks Olivia Maria Belbruno, a resident of Buenos Aires.

– I don’t go to restaurants, I haven’t been on vacation for four years. I had to sell the car because I couldn’t afford the insurance. I rarely use air conditioning and heating. Everyone changes their habits to make ends meet, says Salvador Paterno, a resident of the capital.

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Pessimistic forecasts for the global economy. “On the horizon we see black clouds”Pawel Płuska/Fakty TVN

Many reasons for the crisis

Jorge, 67, who lives on the outskirts of Buenos Aires, works seven days a week to pay his bills. He is a locksmith and football coach. He also works part-time as a salesman. Although he devotes almost every free moment to work, there are months when he does not have enough to the first one. – The situation is complicated. Salaries are low, everything is very expensive. We don’t have enough money. There are months when I am unable to pay for electricity and water. I cannot afford to pay the taxes, which are very high, admits Jorge Armoa.

The roots of such high inflation in Argentina can be traced back to the currency crisis of 2018, when the peso lost half its value against the dollar. A gigantic loan from the International Monetary Fund did not help. After the change of power in 2019, the government sold bonds en masse, which it was later unable to buy back. Add to this money printing and chaotic fiscal policy, and you have a recipe for an inflationary spiral that is very difficult to break.

The economic crisis is exacerbated by the severe drought in 2022, which reduced exports of soybeans, corn and wheat. The government is working to bring inflation down and keep wages down. More than 40 special commissions are trying to work out the best possible solution, Gabriela Cerruti, a spokeswoman for the Argentine government, assures.

High prices will be one of the key issues during the October presidential and parliamentary elections. President Alberto Fernandez’s Peronists are losing support in the polls. The president himself announced that he would not seek re-election.

Author:Justyna Kazimierczak

Facts about the world TVN24 BiS

Main photo source: REUTERS

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