Macri eliminates import limits, hurting small and medium industry and their employees.
Argentine President Mauricio Macri announced during the 21st Argentine Industrial Conference in North Park, Buenos Aires, that of the 19,000 imported product lines classified by Argentine ports and customs, 18,000 will now enter the country with no restrictions.
"We are going towards a Comprehensive Import Monitoring System, which is basically going to a simple mechanism of automatic and non-automatic licenses," Productive Development Minister Francisco Cabrera said. "Only 1,000 will remain subject to non-automatic licenses," he added, referring to the Advance Import Affidavits (DJAI) applied to the majority of consumer goods during the Cristina Kirchner administration.
The measure, according to Cabrera, "will not put jobs at risk;" but chambers representing small and medium businesses, which employ 75% of the Argentine workforce, begged to differ.
"The DJAIs, with all their shortcomings, helped contain excessive imports in defense of national industry. Eliminating them will mainly affect small and medium industries because we cannot compete with costs in low-wage countries and that creates an unsustainable situation," Daniel Moreira, Secretary of the AgePeBA Association, said.
"The announcement was made before the UIA (large manufacturers' lobby), because they, especially multinational corporations, are the only ones that might benefit. Multinationals in particular can now import from their affiliates around the world the products they would rather not manufacture here because of higher labor costs," Moreira explained. "The liberalization Macri is implementing in all economic areas, aims to benefit the largest companies and the wealthiest people. Small and medium businesses and farmers will be the first to pay with measures such as this one and the reduction of export taxes."
"Every small and medium business that closes leaves a real void in their neighborhood, sometimes even their city," he pointed out, warning that "This has the potential of triggering a recession that spirals in on itself until it implodes, as it did in 2001."
"This obsession the right has with liberalizing imports also ignores the fact that international market conditions are currently down. When overseas manufacturers find that market demand is scarce, liberalizing imports in a relatively high-income market like ours - which was protected for a long time - is quite a Christmas gift for them," he said.
Moreira also recalled that the contempt of the Macri toward small and medium business was evident during his election campaign itself.
"Unlike the Front for Victory team (of runner-up Daniel Scioli), this new administration has not called us now or during the campaign. Nor did Macri have a small business policy during his tenure as Mayor of Buenos Aires; he always ignored us and our workers."
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The race to the bottom. Policies that flood the market with cheap imports from slave-wage countries are something we know of only too well here in the U.S.
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