Argentina: Milei declares Aerolíneas ‘subject to privatization’ and intensifies conflict with unions

Despite publication in the Official Gazette this Wednesday (2), the measure needs to be discussed in the National Congress. In practice, this was the first step towards a possible privatization of the airline. Boeing 737-887, from the company Aerolíneas Argentinas, takes off at Jorge Newbery airport, in Buenos Aires, Argentina. Reuters The president of Argentina, Javier Milei, intensified conflicts with aeronautical unions by publishing, this Wednesday (2), a decree classifying Aerolíneas Argentinas as “subject to privatization”. This is the first step towards the privatization of the airline. The measure, which had already been advanced by the presidential spokesman, Manuel Adorni, was published in the country’s Official Gazette. Despite the decree, the topic still needs to be discussed by the National Congress, as the legislation requires authorization from the Legislature. The government was already in conflict with Aerolíneas workers. In September, they went on strike, asking for salary increases as a way to compensate for the deterioration of income in Argentina, which has annual inflation at 236.7%. The strike affected the company’s services. READ ALSO Argentina: poverty soars and affects 15.7 million people; situation affects 52.9% of the population Moody’s agency raises Brazil’s credit rating from Ba2 to Ba1, with a positive outlook Bets: Haddad says that the Treasury will have a system to prevent bets with credit cards and will monitor CPFs In the decree, Milei management highlights that the company was renationalized 16 years ago and that, “despite good intentions” with the measure, “the proposed objectives were not achieved”. “The privatization of the company and its operation under market conditions will allow for a better provision of services, the care of public coffers and, above all, for Argentines to stop financing the deficit of an inefficient company”, says the text. According to the decree, the company suffered steep losses after being renationalized, requiring contributions from the National Treasury “to guarantee operational continuity.” When justifying operational inefficiency, Milei’s management also states that Aerolíneas Argentinas has a staff of 1,107 pilots for 81 active aircraft, which represents a proportion of approximately 14 pilots for each operational aircraft. “A number disproportionate to global industry standards,” claims the government. The initiative to privatize the company is yet another measure by Milei towards reducing the State’s participation in the economy. The president was elected under an ultra-liberal agenda, focusing on privatizations and downsizing of the public sector. This is the second attempt to privatize Aerolíneas. This year, Milei had included the company on a list of state-owned companies to be privatized in the so-called Basic Law. Congress, however, refused to include the airline. Argentina: poverty 15.7 million people; situation affects 52.9% of the population Strike and clash in recent months On September 19, the Argentine government had already told airline unions that, if the strike persisted, the Aerolíneas operation would be handed over to private companies. “Due to the persistent strikes called by the union (…), the national government began dialogues with several private Latin American companies to finally take over the operation of Aerolíneas Argentinas, if the extortions that Argentines are receiving with these types of measures continue “, said, at the time, Manuel Adorni, spokesperson for the Presidency. In August, the unions had already rejected, as “provocative”, a 3% readjustment offer proposed by the government. In this sense, Adorni also questioned the right to strike. Milei’s spokesperson made comparisons to private companies when he said that, “if you go on strike and complicate operations, you will be fired.” One of the strikes, on September 13, lasted 24 hours and affected 319 flights and more than 30,000 domestic and international passengers. The service interruption cost between US$2.5 million and US$3 million, according to the company. Amid the privatization process, unions accuse the government of “seeking the closure of Aerolíneas Argentinas”. “That would be an employer lockout [boicote ou falta de condições de trabalho]seeking to interrupt the company’s operation and then blame the unions and their workers”, they argued.



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