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Argentina’s measures to promote the leather and footwear sectors

Jul 10, 2015 Argentina
Argentina’s measures to promote the leather and footwear sectors
After Ahora 12, aimed at promoting consumption and domestic production in an array of sectors, the government is planning to issue price-control mechanisms on leather, footwear and leather goods
Back in 2014 the Argentinian government has introduced Programa Ahora 12 (in a free translation something like, Now 12), a measure to promote consumption of domestically produced goods and therefore boost trade, employment and domestic production.

With Ahora 12 consumers can pay by credit card, in 12 installments without being charged interests if they buy footwear, leather goods, clothing, construction materials and other selected products from the shop participating in the program. More than 120 000 businesses joined Ahora 12 with affiliated stores placing the identifying sign in their windows. The program will be in place until December of the current year, and is a coordinated action between public sector, private enterprises and credit card companies.

According to information made available by the Ministry of Industry, using data available until April, the consumer incentive program generated almost 8.5 million transactions since it was launched. The same source indicated that transactions involving clothing, footwear and leather goods, are on the list of the main traded products. Débora Giorgi, Industry Minister recently confirmed that leather goods and footwear had achieved the second-highest sales in volume and the fourth-highest in revenues in the months in which the initiative has run so far. In value terms in the refered period, revenue generated from traded clothing reached 5 719 million pesos (roughly 571 million euros) and footwear and leather goods 1 744 million pesos (174 million euros).

Recently, the Industry Minister also stated that the government intends to impose price-control mechanisms on leather, footwear and leather goods. Part of the government’s aim is to contain leather exports as raw materials are being diverted to other markets instead of supplying the Argentina market.

According to CIC, the Chamber of the Footwear Industry in Argentina: “We hope this measure will be implemented soon. Although Argentina is one of the main leather exporters, the price paid by the domestic market is higher than export leather one”.

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