November 20, 2012 / 3:05 PM / 5 years ago

Argentina's Fernandez faces her first general strike

* Union boss calls mass work stoppage over tax policy
    * Workers protest government's response to high inflation

    By Alejandro Lifschitz and Nicolás Misculin
    BUENOS AIRES, Nov 20 (Reuters) - Public transportation in
Argentina as well as grain shipments from the agricultural
powerhouse halted on Tuesday for a 24-hour strike over taxes
called by a union boss once allied with the government.
    The work stoppage by bus drivers, train conductors and port,
airline and bank workers follows wide protests held on Nov. 8
over high crime, soaring inflation and the policy response of
President Cristina Fernandez. 
    The Peronist leader has seen her popularity tumble since
easily winning re-election in October last year, as inflation
runs at about 25 percent despite a slowing economy, according to
private economists. The government publishes much lower
inflation data, long dismissed by the markets as inaccurate.
    "The strike is a consequence of slow economic growth and
high inflation, which the government does not recognize and
therefore does not reflect through adjustments in the sliding
income tax scale," said Ignacio Labaqui, who analyzes Argentina
for emerging markets consultancy Medley Global Advisors.
    The International Monetary Fund has given Argentina roughly
until the end of the year to improve its murky inflation
reporting or risk sanctions. 
    Farmers also joined the protest led by Hugo Moyano, a gruff
former truck driver once closely linked to Fernandez but now a
leading opposition figure. As head of the country's CGT labor
federation, Moyano wants lower taxes for workers to help
compensate for inflation.
    This is the first general strike that Fernandez has faced in
nearly five years in office and the first to hit the country in
a decade.
    The work stoppage increases the stakes in the political
battle between the president and Moyano. Ties between the two
turned sour following the death of Fernandez's husband and
predecessor as president, Nestor Kirchner, in late 2010.
    Moyano's CGT federation split in two earlier this year, with
his allies re-electing him as leader in a vote rejected by rival
union bosses aligned with Fernandez. The fracture in the
umbrella group risks deepening labor unrest as double-digit
inflation stokes wage demands. 
    "This general strike raises the possibility that she is
losing control of the street and it puts the unions that are
allied with her in an uncomfortable position," Labaqui said.
    Fernandez is moving to shore up her base. Her allies in
Congress last month lowered Argentina's voting age to 16 from
18, a change that could help the politically ailing president
court the youth vote ahead of 2013 mid-term elections.
    Argentina is the world's top exporter of soy oil, needed to
make biofuels, and soymeal used to feed cattle as far away as
China, where the emerging middle class is clamoring for beef
steak. The South American country also is the second biggest
corn exporter after the United States.
    "This (strike) was necessary, unfortunately," said Eduardo
Buzzi, who heads the Argentine Agrarian Federation, which
represents small-scale farms. "There is no way to dialogue ...
This is the most anti-farm government Argentina has ever had."
    The agricultural sector has long quarreled with Fernandez
over the 35 percent export tax her government puts on soybean
exports and curbs it places on corn and wheat shipments.
    Calls went unanswered at the main grains port of Rosario and
the usually noisy, truck-jammed entrance to the port of Buenos
Aires was still, with activity expected to resume on Wednesday.
The local stock and bonds market was also unusually quiet.
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