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Poverty collides with policy in Argentine race

Credit: Reuters Studio
Published on October 10, 2019 - Duration: 01:50s

Poverty collides with policy in Argentine race

Rising poverty is becoming a touchstone issue in Argentina's upcoming presidential election, in which incumbent Mauricio Macri's IMF-led austerity programme will be challenged by left-leaning rival Alberto Fernandez, who says it's only making the poor poorer.

David Pollard reports.

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Poverty collides with policy in Argentine race

With an election looming, some may be hungry for political change in Argentina ... Many are just hungry.

In South America's declining number three economy, one sector is on the rise: soup kitchens.

(SOUNDBITE) (Spanish) 46-YEAR-OLD SOUP KITCHEN VOLUNTEER, ISABEL BRITEZ, SAYING: "In total we are feeding more than 2,000 people a day, that is, in total between breakfast, lunch, snack and dinner." Volunteers like Isabel struggle to cope with the scale of the problem.

Amid recession and steep inflation, poverty rates hit 35% this year - a jump of 8% over last.

That means tough dilemmas for politicians ... And for voters, ahead of a presidential race on October 27.

Incumbent Mauricio Macri is in knife-edge talks with international creditors ... In a bid to avoid defaulting on billions of dollars of debt .... A nightmare scenario that could plunge Argentina into even worse crisis.

Rival leftist Alberto Fernandez blames Macri and his IMF-led austerity programme for bringing suffering and deprivation.

Food prices, in the meantime, are rocketing - by nearly 60 per cent over the past year.

According to economist Sergio Chouza, a slump in the value of the peso currency has made things worse - and could go on.

(SOUNDBITE) (Spanish) ECONOMIST FROM AVELLANEDA UNIVERSITY, SERGIO CHOUZA, SAYING: "It is possible there will be more (depreciation).

The move in the exchange rate for the month of August was very considerable, it was 35%." While soup kitchens may be flourishing, pickings for international investors get slimmer.

Moody's anticipates that holders of Argentina dollar bonds are already looking at losses of 10 to 20%.

Even before debt default makes its way on to the menu.

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