Key Points:
- Thousands of workers in Argentina’s Tierra del Fuego province strike against President Milei’s tariff reductions on imported electronics.
- Protesters fear the policy will destroy local manufacturing jobs and cripple the regional economy.
- Milei’s government argues that lower tariffs will reduce consumer prices, claiming that Argentines overpay for electronics.
- Tariffs on phones, TVs, and AC units will drop incrementally, with full elimination by 2026.
- Unions link the move to IMF loan conditions, warning of 4,000+ job losses and economic collapse.
Thousands of workers in Argentina’s remote Tierra del Fuego province braved freezing temperatures this week to protest President Javier Milei’s decision to slash import tariffs on electronics, a move they say threatens their livelihoods and the region’s economy. The strike paralysed the southern province’s factories, shops, and schools, highlighting a deepening clash between Milei’s free market reforms and communities reliant on decades-old industrial protections.
Why Tierra del Fuego Depends on Tariffs
Tierra del Fuego, known for its rugged landscapes and proximity to Antarctica, has long been Argentina’s electronics manufacturing hub. Since 1972, a special tax regime has incentivised companies like Newsan to assemble phones, TVs, and air conditioners locally by exempting them from import taxes on parts. Critics argue the system fosters “screwdriver factories” that merely assemble foreign-made components, but workers counter that it sustains 8,000 jobs in a region with limited economic alternatives.
Milei’s government, however, claims the lack of competition inflates prices. “A 5G phone costs twice as much here as in Brazil or the U.S.,” said spokesperson Manuel Adorni. By cutting tariffs from 16% to 8% immediately, and eliminating them by 2026, the administration predicts prices could drop by 30%. But protesters like Paula Mayor, a Newsan employee, argue this ignores a harsh reality:
“Without tariffs, factories will shut down. What happens to our families then?”
Jobs vs. Affordability: A National Debate
The strike reignites a familiar tension in Argentina: Should the government prioritise protecting local industries or lowering costs for consumers? Similar backlash erupted in 2017 when then-President Mauricio Macri slashed tariffs on laptops, triggering layoffs. Now, unions warn that Milei’s policy could eliminate over half of Tierra del Fuego’s manufacturing jobs.
Governor Gustavo Melella, preparing a lawsuit against the national government, called the tariff cuts a “death blow” to the province’s economy. Meanwhile, unions accuse Milei of capitulating to IMF demands tied to a $44 billion loan, alleging the policy favours imports over domestic production. Could cheaper electronics come at the cost of long-term unemployment? Economists are divided. While consumers may benefit short term, critics warn that dismantling the region’s primary industry risks creating an economic vacuum.
What’s Next for Tierra del Fuego?
The tariff cuts will unfold in two phases:
- Immediate reduction to 8% for phones and 20% for gaming consoles.
- Full elimination by January 2026 for electronics, alongside tax exemptions for locally made goods.
The government insists the phased approach allows time for adaptation, but workers remain sceptical. “We’re not just fighting for jobs—we’re defending our community,” said a union leader at the Ushuaia protest. With factories already shuttered indefinitely, the province’s future hangs in the balance. Will Milei’s gamble lower prices or deepen regional inequality? Only time will tell if Argentina’s push for free market reform outweighs the human cost.
