Thousands in Argentina protest against utility costs, IMF

Demonstrators hold signs reading "No to the IMF" as thousands of protesters from the provinces and from the suburbs of the Argentine capital march towards the Plaza de Mayo in Buenos Aires, on Jun 1, 2018. (Photo: AFP/Eitan Abramovich)

Even as demonstrators gathered on Plaza de Mayo to bring political heat to bear on President Mauricio Macri for vetoing curbs on electricity, gas and water costs on Thursday, his finance minister was announcing painful new measures designed to reassure the markets.

Nicolas Dujovne announced US$780 million worth of public spending cuts at a press conference at the government's Casa Rosada palace.

Among the targets of the cuts were technical assistance agreements with universities, labour agreements, and perks such as the use of state cars, travel and bonuses, the finance minister said.

The march had begun on May 28 from across the South American country's 23 provinces, culminating in the mass protest in Plaza de Mayo.

Demonstrators carried banners declaring "Bread and Work" and "Out with the IMF."

"There should already be a general strike. They cannot distract us with the World Cup or with Messi," said Pablo Moyano, one of the leaders of the main CGT union.

The march was called by the Confederation of Workers of the Popular Economy (CTEP) which groups half a million people without registered employment.

The leadership is close to the Catholic hierarchy and Pope Francis, a former archbishop of Buenos Aires.

Its leader Juan Grabois said that given a widening gap between the middle class and the poor, "Argentina is unviable and the people will rebel."

ANTI-IMF SENTIMENT

Another leader, Daniel Menendez, said Macri's decision this week to veto curbs on utility prices approved by Congress only gave added impetus to the protest.

In tandem with other measures, the aim of the cuts announced by Dujovne is to reduce the fiscal deficit from 3.9 per cent of GDP to 2.7 per cent this year.

Critics meanwhile point to a cost of living increase of almost 10 per cent between January and April alone, and that a Central Bank survey that puts inflation expectations at 22 per cent, well above its 15 per cent target.

Macri on Thursday used his veto to scrap a law placing curbs on utility prices, citing the need for fiscal discipline.

The opposition-sponsored law, approved hours earlier by the Senate after heated debate, would have rolled back prices for public utilities to November levels, and linked future hikes to salary increases.

It was the fifth time since Macri became president in December 2015 that he exercised his veto, a move that will likely deepen his unpopularity and which comes after a damaging currency run saw the Argentine peso lose 20 per cent against the dollar and a decision to go to the IMF.

Opinion polls say as many as 75 per cent of Argentinians oppose any agreement with the IMF, which many link to painful memories of past economic and social crises, including a 2001 sovereign debt default blamed on the lender.