The growing concern is linked to the consequences that sanitary measures are leaving on production, wages and for the future of the country.
“I prefer to have 10% more poor people and not 100,000 dead in Argentina,” was the phrase chosen by President Alberto Fernández to collude the entire Government behind his position of privileging health over the economy as a flag of the fight against the advancement of the coronavirus.
A position that also had the support of the majority of society during the first stage of compulsory social isolation and the announcement of restrictive measures that caused the almost total slowdown of the country’s economy.
This logic of sanitary privilege, before the economic one, made leaving home, going to work, interacting with other people and moving freely become reserved ways of life for those isolated from isolation because they are included among sectors considered essential to maintain services and basic activities.
In fact, at the end of March a ranking of countries with more concern about the virus was released, in which Argentina was in fourth place. The consultation, prepared by Gallup, located Italy and Indonesia with 90% of the population afraid of infection, followed by South Korea (87%) and Argentina (75%).
“In Argentina, the population is afraid that he or some member of his family could contract coronavirus and” this situation is equal in all, without differences by gender, age, socioeconomic level or place of residence, “the report said at the time.
This scenario of fear led the Government to take even more mandatory closure measures, which led to the fact that most sectors of industry, commerce and services were almost unable to maintain their activities on a regular basis. Consequently, to become dependent almost without exception on State aid to get through this crisis without having to close, fire workers or suffer a default.
The same occurs with 31 million inhabitants who today depend wholly or in part on public contributions to survive, either thanks to social plans or the payment of a portion of wages, a measure announced last weekend.
Today, according to a survey by IERAL, 45% of companies are operating by virtue of being considered essential activities, but around a third operate with minimal staffing, so that only 31% operate under full conditions. Meanwhile, another 36% are inactive due to inability to function under current regulations.
Consequently, for IERAL, the sum of the inactive with which they cannot carry out their activities normally represents more than 332,000 companies, a figure that could increase to more than 410,000 if we also consider those that can only operate with minimum endowments.
A scenario that in recent days led society to change its view regarding the fears anticipated at the beginning of the arrival of the pandemic in the country and to begin to show anger and satiety over the extension of compulsory sanitary stocks.
At least this is what emerges from a survey recently carried out by Kantar to analyze the reaction of Argentine consumers to the pandemic, demonstrating this change in thinking.
In the framework of interviews with a universe of 503 people online, conducted between April 10 and 14, it is now observed that 8 out of 10 Argentines are more concerned about their economic future than about the eventual spread of the virus. The Covid-19 Barometer shows that, after this month of social isolation, fear of the coronavirus begins to relax to the point that the proportion of “very concerned” fell from 55% at the end of March to 47% today.
Those over 55 are the most concerned (52%), as are the people with the highest incomes, while millennials and centennials are not as affected (45%).
On the other hand, the effects of the slowdown are beginning to be felt, considering that 77% of those surveyed believe that it will take a long time to recover the economy once the health crisis is over.
Of this percentage, six out of 10 people admitted that their personal income was already affected, while 24% still do not perceive it but believe that they will be in the short term.
There is also a certain saturation of the information that the media reports about the virus, which leads to 27% of those surveyed by Kantar trying to watch fewer news programs and intensifying the need to be in contact with family and friends.
Nothing new if the requests and claims of almost all the private sectors are remembered so that the Government makes isolation more flexible, incorporates more sectors to the excepted and allows a return to activities with logical care measures and appropriate protocols to prevent the virus get out of control.
To reinforce this claim, reference can be made to a survey carried out at the beginning of April by PwC Argentina, which reveals that 15% of the 150 companies that responded stopped operating due to preventive and compulsory social isolation, another 59% have decreased their sales, 22% continue to operate normally and only 4% have increased their income. Of the total of the companies surveyed, 74% registered a drop in their level of activity, both in the service sector and in the mass consumption and industrial sectors.
Data that support an order that is already unanimous and that is part of the Argentine Industrial Union (UIA); the Argentine Chamber of Commerce (CAC), representative entities of sectors such as gastronomy, tourism, entertainment, financial and public services, the countryside, shopping centers.
Coincidentally, during the day on Wednesday, a new order from the trade sector that generated 65% of the value added and the registered private employment of the country was known, to analyze variables that allow recovery to normality.
The CAC sent a letter to the Head of State in which, like the rest of society, he shows his agreement with the measures that the Power
The National Executive (PEN) implemented to take care of the health of society, but which also calls for coordinating efforts to mitigate the impact of sanitary measures on production processes and employment.
The letter already speaks of commercial and economic paralysis as another “serious scourge” that, if not treated in the right way and at the right time, can have devastating consequences. For this reason, the CAC, almost by way of request, asks Alberto Fernández that if he is to prolong the quarantine, the activities considered essential be expanded.
As in the Kantar survey, merchants also warn of the need to generate income for employees in the sector, taking into account that this is “a first-rate concern for citizens, especially those of employers and the employees”.
Otherwise, businesses anticipate that the final closure of many establishments will most likely occur and unemployment would become massive, with the social overflow and public lack of control that this would imply.
For this reason, they ask the government to create a crisis committee made up of the authorities, the unions, the areas of health, the economy, production and work to reach a consensus and draw up hygiene and health protocols to help free up activities.
“This would allow, gradually and administered, to start up commercial activity and, through it, the economy in general, privileging in all cases the health of workers, employers and customers, and, in this way, the of the entire population, “argue the merchants.
Unions, governors and mayors from all over the country also join the request for less restrictions to allow what will be a slow industrial revival and the purchasing power of the population.
What’s more, the Kantar survey shows how the number of people who pay more attention to prices, which reaches 56% against 49% at the end of last March, also grows. Furthermore, in the medium term, 85% of people think that they will have to be more proactive in their financial planning, with those under 35 years of age from lower-middle socioeconomic status being the most pessimistic about the speed of recovery.
Likewise, the economic consequences of isolation measures cross the majority of people, in all age and income segments, and can even generate new purchasing habits that last over time, taking into account that 40% of those consulted says that they will increase their online purchases and use electronic means when paying.
The change in society’s opinion was surely a topic of conversation at the summit that took place in the fifth presidential office in Olivos during the afternoon-evening of this Wednesday, April 22.
A meeting between the President and 11 of his main ministers and officials linked to the study of the coronavirus, both from the health and economic aspects. From the head of the Cabinet, Santiago Cafiero, through the ministers Matías Kulfas; Martín Guzmán; Gabriel Katopodis; Claudio Moroni and Ginés Gonzalez García, among others.
According to some sources, the decision would be to extend the mandatory sanitary stocks for another 15 days, thus reaching May 14. But, in response to business requests and social satiety, there will be greater flexibility in activities, especially in the interior of the country, in order to heed society’s signals and avoid greater economic risks.
More than anything because there is no certainty that the labor market can sustain its current reality, with thousands of cases of salary reductions, late payments, suspensions and threats of mass dismissals despite the existence of a presidential decree that expressly prohibits work terminations for 60 days from the beginning of the quarantine.
The most worrisome cases are in fast food chains and restaurants; the sector of sale of household appliances and sports houses, among others, that almost cannot work. The same occurs in most terminals in the automotive and auto parts sector; in services related to recreation, and tourism.
Construction leads the podium for layoffs by sector, led by the Techint case, while other industries such as the metalworking company that closed an agreement with the union to suspend layoffs for 120 days in exchange for reducing wages to 70% for some 126,000 workers. In the same sense, the hydrocarbon sector also slows down layoffs in exchange for 70% wages.
The problem occurs because only 32.8% of workers (2.1 million people) are fully operational in essential activities and another 39.6% (2.5 million people) work in inactive sectors due to the impossibility of function.
But beyond these agreements, it is clear that the guide for the short and medium term does not go through extending the measures taken so far to avoid this possible scenario of the country’s economic collapse.
They will not be enough if there is a new extension in the time of the compulsory sanitary stocks, since it is aid for March and April, but not for the next months in which it is assumed that the majority of the country will also continue to live in confinement.
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