2023-05-17 12:50:00
Inflation complicates all sectors, and not just the day to day of consumers. For example, the president of the Argentine Chamber of Construction (CAMARCO), Gustavo Weiss stated in the last few hours that “the public works plan is difficult to carry out with these levels of inflation”.
Among other things, the head of CAMARCO warned that “contracts lose economic value month by month and delays in payments, with rates of eight to 10%, make a delay of one or two months very difficult to bear.” “.
Controls for runaway inflation
This morning, in statements to Radio Mitre, the businessman maintained that although “there are many public works throughout the country, not only from the national government, but also from the provincial ones, the public works plan is difficult to carry out with these levels of inflation”.
and detailed that public works contracts have a price update system, with a polynomial formula with INDEC indices designed post-convertibility, to keep the values of the signed contracts constant. However, Wiss indicated that “it deteriorates with these levels of inflation.”
Public works with delays of up to 9 months
Likewise, he remarked that the works linked to the World Bank and the IDB are quite up to date, but he assured thatand “the works by agreement of the national government with the provinces or municipalities have longer delays.”
In this line he explained that “there are cases inside five to nine months. These works are semi-paralyzed or paralyzed. There are no large works, such as ports, power generation plants. But there are investments in railways and roads. The pipeline is financed and there is no problem,” he added.
Alarm due to the acceleration of inflationary inertia: they fear that it will reach 9% in May
Along these lines, he also held that “There are works of 20 thousand to 40 thousand million pesos that are important works and very difficult to finance in the situation that we mentioned.. The financial system does not strongly support it,” the businessman complained, adding that “Most construction companies in the country are SMEs. They are not overly large works but for companies they are important”.
Concern in the meeting of partners
It is worth remembering that yesterday, May 16, a meeting was held between members of the Argentine Chamber of Construction (CAMARCO), and authorities of the entity where they analyzed the “serious impact” that the insufficiency causes in the companies of the payments for the work carried out, due to high inflation and the late recognition and compensation of its effects. “All this aggravated by a growing delinquency in payments in many Departments“, they assured in a statement from the entity.
“Delay in payments always generates enormous damage, a situation that worsens in a context of high inflation. In addition, this delay is not compensated due to the non-payment of interest established by the Public Works Law,” they warned.
Beyond today’s photo, which is complex, the entity warns that there will be more immediate and very serious consequences, and among them they pointed out:
– Strong impact on employment
– Paralysis of the works
– Affectation of the continuity of companies and the industry value chain
In this scenario, the authorities of the institution demanded from the national and provincial authorities a “urgent normalization of the payment scheme and redetermination of prices”, in order to avoid having a strong impact on employment and stopping more works if the current situation does not change.
LR
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