The fresh produce sector in Argentina says it is still too early to say what the effect will be, just over a month after new President Javier Milei took over and introduced several new measures to help stabilize the country's finances. Latin America's biggest economy now has the world's worst annual inflation rate at 211%, according to official government figures, surpassing that of Venezuela, which has long held this pole position.
Assumption of office by President Javier Milei on December 11, 2023. Photo: Argentina Presidency.
A large producer and exporter of citrus in Argentina described the situation on the ground in the country: "So, it's hard to know where Argentina is going to lead to… What I can say is that the previous way was definitely not working. If this is the right way or not is hard to know yet, but at least what we are sure about is that he is definitely doing things. How it will affect Argentina, citrus and exports is still too early to know; changes are way too recent, and as I understand it, they are just the initial ones to stop the consistent deficit that Argentina has. Then they will move on to other topics which should help our exports/imports. Once again, it's too early to know what is going to happen! Maybe these changes will make things worse?"
The measures President Milei announced as so-called 'shock therapy' to the entire system include devaluing the Peso by 50% to the US dollar, canceling government subsidies and contracts, etc. These are all meant to help curb expenditure, be more market-friendly, and eventually lead to a more stable economy. In the end, the aim is to ease the plight of a large part of the population who are in poverty due to decades of different and unsuccessful economic policies.
Prices change frequently
Due to rampant inflation, the prices of goods change frequently. "At the moment in Argentina, everything is too expensive; prices change every minute. People go to the supermarket, check prices, then go to the next supermarket, realize that some things were cheaper at the first supermarket, go back to that first one, and the price already changed! That's how crazy it is. Nobody knows even what prices to put on things. It will take some time for the market to stabilize."
Hope that Milei's changes are positive in the long run
"I do personally have hopes that these changes will be good for Argentina in the mid-long run. Right now, in the short term, they are tough. But Milei very clearly said that he was going to make these changes and that it was going to be a very tough start. I just hope Argentineans are able to survive this first short term to be able to let the president go on with the changes that Argentina needs."
Another producer and exporter in Tucuman said they are also watching, waiting, and hoping that things turn around for the country after this initial period of actions by the president. "There are changes in government, not only nationally but also in each province. There are positions without their boss, so there are no clear measures and their possible impact."
They say that while the devaluing of the Peso is good for the fruit export sector, the input costs such as chemicals and machinery are becoming even more expensive. Argentinians have already held several protest actions to oppose the austerity measures. Experts say the Milei government aims to deepen the austerity measures.