Industria Argentina vs. open markets

Argentina is justifiably proud of many of their homegrown products. In particular their food, wool and leather products are well known throughout the world and proudly stamped with the label “Industria Argentina”.

However a little known side effect of this is that this pride together with a hankering for protectionism means that many in particular cheaper products labeled Industria Argentina are absolute crap. For example try buying clothes where ordinary lower and middle class Argentines buy their clothes and you find poor quality at relatively expensive prices. Materials with unfeasably low thread count is what Kirschner wants his voters to wear.

A t-shirt that in Panama would cost US$2 would easily cost triple in Argentina and the quality would be worse. There is little use trying to import cheap clothes into Argentina, the customs duties will kill you. Rather the market is served by a small collection of local manufacturers who produce incredibly poor quality. Why this poor quality, well they can get away with it as there is no external competition would be my bet.

I noticed several Chinese trinket shops that do sell the cheaper gadgets, bags and home furnishings that adorn many poorer house holds throughout the developing world. And here again the prices were much higher than in Panama. All the trinkets also were emblazoned with the customs duty stamp below:

So while Kirschner and his other peronista fools are telling his voters that they are protecting the Argentine economy, they are really reducing the real value of their voters hard earned pesos. And for what? To protect the jobs of a few thousand (my guess) textile workers. However this is not the whole story of Industria Argentina…

If you go to the stores were upper middle class people shop you can find really good quality well designed clothes cheaper than here in Denmark. But still no cheaper than Panama and the US. I bought a couple of great shirts for about US$30 in a shop, where they enthusiastically told me they were in the process of opening shops in Panama.

This shows that Industria Argentina is absolutely capable of competing internationally, so the excuses of the idiot protectionists has no real base in fact. If these textile workers at risk above could be moved into producing higher quality clothes, they would no doubt be able to earn a good living and also purchase better quality clothes etc. for themselves and their families.