Uruguay Launches Package of Inflation-Curbing Measures
EnglishUruguay’s Economy Minister Mario Bergara has announced that to avoid escalating inflation, the government will approve the prices of basic goods with supermarkets. Other measures include tax cuts for electricity and communications, a reduction of VAT on fruit and vegetables, and a waiver of medical insurance fees.
Bergara aims to curb speculation among economic agents, thus containing rising prices. If applied properly, the package is supposed to have a downward impact on the Consumer Price Index of between 0.8 and 1 percentage points in its first month.
Unionists and part of the Uruguayan government seek to emulate the system of “Cared-For Prices” implemented in Argentina, which they characterize as “a success.” The Uruguayan government is concern is that accumulated inflation for the twelve months up to February reached 9.82 percent, the highest rate in the last 10 years.
Regarding the expected success of the package, Bergara said that “the evolution of prices is being permanently monitored and studied. Measures are taken and analyzed considering a time horizon beyond April’s data.”