Gabriel galdeano has been up since midnight. Behind him are crates of red tomatoes and chili peppers, next to them are plump tangerines. The greengrocer sits at a table and issues receipts. He’s been worried for a long time. Food prices have increased massively in Argentina in recent months. The costs of energy, transport and packaging material are increasing and increasing. “We feel it immediately,” says Galdeano, using lemons as an example, the price of which has doubled in two months. Inflation in Argentina is likely to reach 90 percent this year, and some economists are even assuming a three-digit rate – much more than in most other countries in the world, where inflation also makes the headlines. Many Argentines consume less, says Galdeano. “Today we work with minimal margins.”

Most of the traders at the Mercado Central in Buenos Aires, one of the largest wholesale markets in Latin America, feel the same way as Galdeano. From here, the metropolitan area of the Argentine capital with its 15 million inhabitants is supplied with fruit and vegetables. Over a hundred thousand tons are turned over every month. While it was still dark, a column of trucks had formed in front of the huge site in the suburb of La Matanza, making its way to the 18 huge pavilions where hundreds of wholesalers were waiting. The workers walk around with forklifts, box lifters and wheelbarrows. Crates are unloaded and disappear into the open gates of the sales halls. Breath vapor and cigarette smoke rise in the cold morning air.

22 million welfare recipients

The traders on the Mercado Central are used to price fluctuations, but the situation is extreme at the moment. It reminds many of the crisis of 2001 and 2002, when inflation soared to more than 40 percent and poverty to more than 50 percent after the financial system collapsed. The country has never really escaped the inflation trap. In the past decade, inflation in South America’s second largest economy has never been below 25 percent, in recent years it has even been significantly higher, with a new peak this year – with no prospect of improvement. The left government spends far more than it takes in. “The state budget has basically collapsed, the deficit is out of control,” says economist and former Minister for Production and Labor Dante Sica in an interview. There are no more loans, so the government resorts to printing money to finance the deficit. “And that accelerates inflation.”

Inflation affects people differently. In some income groups it has even triggered a consumption boom. Downtown Buenos Aires’ restaurants fill up nightly, and not just with Brazilians, who feel like royalty in Argentina with their spending power. The shopping malls are teeming with Argentines with full shopping bags. Anyone who has pesos wants to get rid of them so as not to be stuck with a currency that is depreciating every day, says Sica. Those who cannot invest in foreign currencies spend the money and buy goods as investments. But all of this is not sustainable.