High inflation is pushing the poverty rate even higher in Argentina

Buenos Aires, Argentina — One of the highest inflation rates in the world is making it difficult to make a living in Argentina, where almost four out of 10 people were poor at the end of last year, official data revealed on Thursday.

In the second half of 2022, poverty increased to 39.2 percent of the population, an increase of three percentage points compared to the first six months of the year, Argentina’s national statistics office, INDEC, said. Among children under 15, the poverty rate increased by more than three percentage points to 54.2%.

In a poor neighborhood of Argentina’s capital, those who run a soup kitchen don’t need statistics to tell them what they saw in an economy hit by 94.8% inflation last year.

“There is more poverty than before,” said Graciela Gamarra, who runs a soup kitchen in the Fraga neighborhood that distributes more than 800 meals every weekday afternoon.

“After the epidemic, everything got worse,” he said. “Most are in precarious jobs, they don’t have a permanent job to say how much they’re going to earn every month.”

Rosa Guerrera, 76, was one of those who went to the community kitchen with her plastic container for food on a recent afternoon.

“If there was no public kitchen, what would happen to me?” Guerrera said recently more people have come from outside the area to request food.

Experts say inflation has hit lower-middle-class families in particular, as food prices have risen more than other products.

“If the inflation issue is not resolved, it will be very difficult to restore purchasing power and reduce the poverty level,” said Eduardo Donza, a researcher at the Social Debt Observatory of the Catholic University of Argentina.

Even if inflation were to magically disappear, “it wouldn’t be enough because the poverty level is linked to a very precarious labor market,” Donza added.

The proportion of the population of Argentina who are indigent – those whose income does not cover even the basic minimum food needs – decreased slightly, from 8.8 percent to 8.1 percent.

The decrease is largely due to the welfare programs, without which the poverty rate would be around 18%, estimated Donza.

The government’s efforts to cool inflation were further hampered by the devastating drought, which further increased costs. Annual inflation rose above 100% in February.

Although the poverty rate has fallen slightly in the second half of 2020 from 42% at the height of the COVID-19 pandemic, it will undoubtedly be one of the main issues in the presidential campaign ahead of the October election. President Alberto Fernández has still not said whether he will run for re-election.

Members of the opposition were quick to criticize the government when the latest poverty figures were released.

“More than 18 million Argentines are poor,” former Buenos Aires governor María Eugenia Vidal wrote on Twitter. “And you know what’s worst? This information is out of date. The situation is even worse in 2023.”

For now, many Argentines do not believe that things can improve, even with new leadership.

“All politicians promise, promise, and when they’re there, they don’t see you, they don’t listen to you,” Gamarra said in the public kitchen. “Most people here think the same way – just promises they don’t keep.”