New wave of shutdowns and layoffs puts Argentine industry on alert

[retiredbanker]

I went into Zara expecting cheaper prices. Here in the US it is known as a bargain priced store. I walked in there and same exact merchandise was very expensive. I thought prices were supposed to come down in Argentina but it didn't look like it. I went into many stores. It is hard to believe that locals would pay these prices. I noticed the same thing. No one is buying.

Stores like Zara are expensive compared to US or Europe. What I noticed is prices at higher quality stores is still very expensive. Stuff isn't selling but stores are discounting to get stuff out the door. As it should be.

 

[Edmonton]

I keep reading about different manufacturing companies closing or laying off workers. I get that China produces stuff super cheap. But what I don't understand is how these Argentine companies can't compete? Everything I am reading seems to say salaries are only 700,000 pesos which is about $450 dollars per month. How can't these industries be competitive here. What gives?

 

[import export]

I keep reading about different manufacturing companies closing or laying off workers. I get that China produces stuff super cheap. But what I don't understand is how these Argentine companies can't compete? Everything I am reading seems to say salaries are only 700,000 pesos which is about $450 dollars per month. How can't these industries be competitive here. What gives?

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That $450 bucks is what they are taking home but there is a sh*t ton of taxes in Argentina so the employer is paying at least double of what the employees are getting. At least if they are in white and not paying them under the table. Taxes and expenses eat up a big chunk and it is still cheaper in Asia.

Remember utility costs jumped up. Electricity jumped up 400%. Water and gas too. Labor is a small part of the equation. Many companies have to finance with huge interest %.

Argentine companies are lazy and had protectionist Peronist policies protecting them before. Labor was even cheaper and expenses were low. They can't compete with China period. They never had to before and they can't now and can't in the future. Argentina isn't an efficient country.

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