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ARGENTINA:
President Urges
Boycott of Shell Products
Marcela Valente
BUENOS AIRES, (IPS) - In
an unprecedented gesture,
Argentine President Néstor
Kirchner urged the public
Thursday to boycott Royal
Dutch/Shell's products, to
protest what he described as an
”unjustified” increase in the
prices of petrol and diesel
fuel.
”Argentines don't have to buy
anything from Shell. Let's unite
and not buy a single thing from
them, not even a can of oil, so
they realise that we will not
put up with this kind of thing
anymore,” Kirchner said in
response to Wednesday's 2.6 to
4.2 percent fuel price hikes by
the Anglo-Dutch energy giant.
Shell said it boosted prices
because of the rise in the
international price of oil.
However, its local competitors
have so far abstained from
following suit.
The president of the Consumer
Education Centre, Sandra Andrada,
told IPS that the call for a
national boycott is ”a mature
strategy, the best option in a
country where it is the free
market that regulates prices.”
She also underlined the novel
aspect that the current campaign
was called for by a president.
”We were not previously
consulted, but we see it as a
very timely decision because it
will serve as a warning to other
companies, to show them what can
happen if they boost prices in a
compulsive manner,” said Andrada.
Economist Claudio Lozano with
the Central de Trabajadores
Argentinos (CTA) trade union
federation commented to IPS that
the boycott is ”an interesting
strategy, because companies that
raise their prices
unjustifiably, when they are
already making extraordinary
profits, need some kind of
discipline.”
Lozano, who is also an
opposition lawmaker, said the
price hikes are not justified
because there has been no change
in the company's costs, domestic
demand remains sluggish, and
most companies are not yet
producing at full capacity.
He also said there has been no
increase in wages to explain the
decision to raise prices. On the
contrary, he noted, the
purchasing power of wages and
salaries is still 15 percent
lower than it was prior to the
late 2001 economic collapse.
However, Lozano said that if the
government is determined to
pressure transnational
corporations to keep their
prices in line, it should draft
anti-monopoly bills or laws
aimed at guaranteeing supplies
in key sectors, in addition to
calling for a boycott.
”State regulation should
accompany the citizen action,”
said Lozano.
Kirchner's call for a boycott
came as a surprise during an
event at the government palace
held to announce the
distribution of school smocks to
children in poor neighbourhoods.
He said consumers should
”peacefully” reject Shell
products to protest the price
hikes.
”There is no better action than
this 'people's national boycott'
of those who are abusing the
people,” said the president, who
thanked two of Shell's big
competitors in Argentina, the
YPF-Repsol Spanish oil giant and
Brazil's state-owned Petrobrás,
for ”not following” the example
of the price hikes.
The government is concerned
about the impact of the rise in
fuel prices, as well as
increases for other products
(including beef and construction
materials), on the cost of
living in a country where nearly
half of the population of 37
million is still below the
poverty line.
According to public and private
sector projections, inflation
for the first quarter of 2005
could be almost as high as the
inflation rate for all of 2004,
which stood at 3.7 percent.
Consumer prices climbed 2.5
percent in January and February,
and are expected to rise one
percent this month.
A local resident of Arroyito, in
the north-central province of
Córdoba, told IPS that in his
small city, where the Arcor food
company produces candy for
export around the world, the
wage increases ordered by the
government in December were
merely offset by raising prices.
”Our wages were raised, but we
at once noticed that the prices
of the food produced by the
company had gone up. Local
stores told us it was because of
the year-end holidays, but after
that, the prices did not go back
down,” said the source, who did
not give his name because he
works for Arcor.
Hyperinflation was controlled in
Argentina in the early 1990s.
But inflation has once again
become a source of worry for the
government, especially since the
recent debt swap that
restructured the public debt,
which Argentina defaulted on in
December 2001.
The price hikes were the main
focus of headlines in the local
papers Thursday. The president
had already criticised what he
called an attempt by some
companies to rake in
”exaggerated profits” and
accused Shell in particular of
”not collaborating” with
Argentina's economic recovery.
He also lashed out at
stockbreeders who increased
domestic prices of beef. ”I
think it's great that the beef
industry is doing well and
increasing its exports, but it
should not raise prices on the
domestic market,” Kirchner said
Wednesday.
He later said he would ”not
tolerate” a new outbreak of
inflation. ”We will work
steadfastly and gradually adopt
measures. We will not sit back
and just watch prices go up,
without doing anything about
it,” he warned.
Activists with the unemployed
movement picketed outside Shell
headquarters in Buenos Aires to
protest the price rises. Luis
D'Elía, with the Land and
Housing Federation, said Shell
”wants to sabotage Argentina's
recovery from the crisis.”
D'Elía announced that the
movement would urge the public
to back the boycott, and said
that if the prices were not
reduced, it would block access
to the company's gas stations. |
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