The goal is to make this destination a favorite spot for children in Christmas time, both local residents as well as those coming from out of town.

With scenic views and magic sights it is difficult to imagine what else can the community offer, however, much more will be in place from majestic concerts to family activities that will be offered for free. Even Santa Claus will pay the community a visit at the “Arrayanes Forest“. This event has been nominated as one having national repercusion by the “Administracion de Parques Nacionales”.

The planned schedule is as follows:

December 15th: Concert by the “Orquesta Sinfonica de Neuquen”.
December 16th: Concert of flutes at the Arrayanes location by the “Orquesta de Flautas de San Martin de los Andes”.
December 20th: Concert of Children Chorus by Youth singers of Bariloche.
December 21st: Concert by the “Orquesta Cofradia and Coro Juvenil Municipal de Bariloche”.

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Starting today, automatic teller machines will be delivering again paper money that has just arrived from Brazil. Still, the Central Bank of Argentina issued a note stating that most likely only “Banco Nacion” will be able to supply the $100 pesos notes as there is no time to distribute them to all ATMs. As days go by, the whole 100 million “100 bills” that were ordered -10 billion pesos- will be placed in the machines.

Tourists from Brazil and abroad are welcoming the relief as many had to wait long lines for cash from the few machines that had any supply left. But here is an alert to anyone coming to visit: problems may persist for at least another 2 weeks as distribution to all areas of the city is somewhat complex. And the demand for cash has been on the rise as retirees will be withdrawing their pensions in cash and supply will have to cover the extra money being paid -as bonuses- at the end of the year.

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It is also estimated that most of Cuyo, the southern part of Cordoba and the west of Buenos Aires province will not be receiving rain for some time, as opposed to the NOA region, southeast of Buenos Aires and Chaco as well as north mesopotamia. These weather patterns are expected to stay in place till March and while yield would be reduced, farmers and agents might find compensation in the already higher grains prices which are in turn pricing potential argentine bad crops.

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Succintly, Molina made clear that he was not only coerced into funding the official political campaign at the time but also threatened with roadblocks on his actions as manager of the company if he didn’t cooperate by making it easy for Aerolineas to engage in certain transactions of very large amounts, in which pressumably Vázquez et al. would have had a bite. Interestingly, right after Aerolineas Argentinas was nationalized, the company finalized the purchase of 20 embraer planes from Brazil. The same transaction Molina refused to greenlight, adding that prices set for buying the planes looked stretched in many ways.

Ever since the death of Nestor Kirchner many political figures with ties to the administration have been voicing the need to “profundizar el modelo”. That is, to complete the structural changes initiated by Nestor Kirchner… whatever that means. In reality, digging deeper is hard to find anyone that can precisely explain what is or even how to “further Kirchner’s vision for Argentina”. It is possible that the common person in the street would view this change as one where unions acquire even more power and a bigger piece of the cake just as Moyano has been declaring recently that it is time for argentines to have a “worker” in the Pink House. For yet another group of perhaps more sophisticated citizens, this furthering may entail even more widespread redistribution of income dangerously depleting any wealth left. But for the more savvy bunch, it could just be that what all this really means is pursuing a method of governing where the figure of the government is used to access and acquire power over both private (nationalizing) and public resources with the ultimate goal of manipulating existing structures to facilitate the channeling of funds to those in charge.

Molina’s tale seems to point in this direction as much as many of the recent emails that have been made public through the investigation of the Jaime/Vazquez affair. It may be that a leftist and radical government may find it easier to enrich its own comrades by the use of their special powers. Something that can be vastly more difficult to accomplish if free market forces that make competition and efficiency mandatory where the order of the day. Unfortunately, the average criollo will hardly be able to connect the dots when not even 5 judges working on these and other cases of corruption in official agencies may be able to bring any light or prove any wrongdoing.

Here goes a hope and a wish for Argentina’s bright future… and a new rising model.

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Under the disguise of a noble cause, the municipality of Bariloche (Rio Negro) will issue a special tax to corporations who do business within the limits of the city but have their headquarters out of the city limits. The sum levied on these corporations will range from a minimum of $5,000 pesos per month up to $15,000/month depending on annual sales volume.

In another example of how peronists push for income redistribution without any logical planning or with no consideration for future consequences, the money raised will be destined to promote social and educational activities to the lower end of the population -who, in their view, has been so far “excluded”- by means of maintaining or developing the appropriate infraestructure for cultural, recreational and sport endeavors. These activities will mostly cater to the very young or very old.

In reality, “ediles and concejales” are sending out the message that they are unable to cut expenses and make the administration of the city more efficient, where it has been said up to 80% of the budget goes to pay fat salaries. The unintended consequences may be that some or many of the targeted firms who have been doing business in the region may just opt to settle in nearby towns of San Martin de Los Andes, Villa La Angostura or even Junin de Los Andes.

This measure would affect foreign businesses of any kind, as long as their annual gross sales are over 8 million pesos. The cuttoff line seems to be 30 million in annual sales, above which firms would contribute the maximum of $15,000 pesos per month. In an ironic twist, these levy has been described as both “solidary and mandatory”.

It was two years when this tax was sponsored by Daniel Pardo, a “concejal” from Rio Negro, who based on a research conducted by the “Centro de Estudios Regionales” learned that Bariloche’s GDP was one of the highest in the nation while porverty levels were above 30%. His view was that corporations making money would not reinvest it locally but move funds away from Bariloche. “Corporations making money” being the bad word. Or offensive phrase.

It is apparent that businesses that help drive tourism to the area and are in part responsible for having these crowds spend their monies on local goods and services, patronizing a vast and diverse array of mom-and-pop shops during their stay, means little. While reaching for the populace vote through enchanted “income redistribution” songs, means much. Even though in the long run those for whom this measure has been enacted may see a smaller economy, less oportunities and even higher personal taxes.

Brilliant.

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As such, Argentina has been missing the train of international skyrocketing prices that would have greatly benefitted the sector. More recently, however, there has been talk of a partial opening of exports via the establishment of quotas. In a maneuver that can be seen as Julián Domínguez – the Minister of agriculture- gaining more influence within the administration while Moreno loses ground, Domínguez announced the possible establishment of export quotas in the amount of  18,5 million tons for wheat and 5,5  million tons for corn.

The news though, wasn’t received warmly. Some insiders to the farm industry instead of acknowledging this as progress have expressed their distrust to government measures that might keep affecting prices paid negatively as quotas would not nurture the needed competition that free markets offer and farmers can take advantage of. Still, there is a sense that with Domínguez there could be more dialogue than there ever was with Moreno.

And that can only be a good thing!

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Manufacturers think they can get away with the increases given that they are well below official inflation figures of about 25%/year. As it usually happens, they blame their own cost chain to have pushed prices up (raw materials, etc.) and thus, increases are only being transfered to the final consumer.

With this latest increase, prices have gotten to where they were before the collapse of the currency in 2002. At the time, 1 kg of ice cream was approximately u$d 16/kg.- Just like with many other items, prices have reached the same comparative value they had with the old parity of  $ 1 – u$d 1 pre-collapse. Still, inflation has not been an obstacle for some of the national chains to keep their expansions current. One of the cheapest products in the market belongs to the Grido chain, with 850 branches and headquarters in Cordoba. They are pricing their products at around $23/25 pesos /kg. Grido will be opening another 40 ice cream shops in the city of Buenos Aires and the outskirts during 2011.

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The benefits are enormous. Increased capacity means better and more thorough training of workers, expansion of distributorship as well as the opening of new chanels of distribution and the need to solve some logistic problems which will require continuous investments. The Ministry of Industry estimates that in the near future, about usd 1 billion will be required to modernize and expand plants and that this funding is almost guaranteed to be used in the period right ahead, 2010-2012. Fiat, Ford and Peugeot Citroën will all participate in this “upgrade”.

According to some industry insiders, Brazil demands close to 3,4 million units per year. A figure that is expected to increase over time as the ratio of units owned per capita is actually lower than in countries such as Argentina. The same insiders opined that if Argentina is able to produce the expected quality, then the demand will be there. This, is already being seen in some manufacturers who have increased shifts and extended working hours. The more serious stats point to a 10% increase in production for 2011, at least. Almost all auto industry executives believe that the demand coming from Brazil is “sustainable, strong and would continue for at least another 3 years”.

However, not everything may fall into place. Some of the decision-makers are afraid that the autoparts agents they rely on for capacity expansion may not be there when they are needed the most. Same fears apply to training both new and old workers. Executives are accutely aware that any of the above can become major roadblocks so they are only “cautiously” optimistic. In addition, many count on the federal government to come forth to create additional infraestructure in the form of power generation and the like. Something that they have learned not to count on. But in spite of these potential problems and that the whole industry is not and cannot be completely and vertically integrated, there is a general sense that finally the auto industry has reached maturity.

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