Argentina: Financial crisis could cut 40,000 construction jobs

Argentina: Financial crisis could cut 40,000 construction jobs
Last update: 07/09/2018

BUENOS AIRES, Sept 7 (BERNAMA-NNN-TELESUR) -- Argentina's construction sector could be forced to shed some 40,000 jobs in the next few months because sky high-interest rates are making it difficult for businesses to finance projects, experts warn. Last week, the central bank raised interest rates to 60 percent with the intent to curb high inflation and save the quickly devaluing peso.

Construction executives now say they can't even access enough credit to finance the public works promised by President Mauricio Macri's government. "Banks are withdrawing financing from public works companies; it's concern over the fiscal adjustment that will hit public works," said Chamber of Construction President Gustavo Weiss.

The government has also introduced new austerity measures, including downsizing 10 ministries. Last month, it announced US$99 million in cuts to the public education sector, which was met with major protests in Buenos Aires. The cost-cutting measures and increasing taxes on certain agro-export commodities were taken to restore investor confidence in the economy.

They were also made as part of the International Monetary Fund (IMF) loan conditions to significantly reduce the primary deficit. However, some investors are concerned the government won't be able to pay back its US$50 billion IMF loan, of which it has already received 30 percent and is now seeking a further advance.

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http://www.bernama.com/en/world/news.php?id=1640291