The warehouse is shrouded in semi-darkness, the machines are switched off and boxes of unsold goods sit waiting. Footwear factory Kioshi, which employed 120 people in 2023, now has just 14 staff. It has become a symbol of an industry in crisis, fuelling debate over Javier Milei’s economic model in Argentina.
While the ultra-liberal president’s government hails falling inflation and deregulation, business leaders warn of job losses, unfair competition and falling consumption.
“The domestic market is dead. People don’t have money to spend, so they’re hardly going to buy shoes,” said Emmanuel Fernández, director of Kioshi, which is located in Esteban Echeverría on the outskirts of Buenos Aires.
On top of that, there is an “avalanche of imports,” he added.
Last week, the Unión Industrial Argentina (Argentine Industrial Union, UIA) organisation called for measures in response to the opening of the economy and the loss of some 90,000 industrial jobs since August 2023.
Argentina’s industrial sector had almost 40 percent of its production capacity sitting idle in June. Manufacturing output fell five percent between June and July, its sharpest decline in 16 months, according to official data released on Tuesday.
On the same day as the industry group’s appeal, Milei said in a speech that his austerity and deregulation policies were “non-negotiable.”
Since he took office in December 2023, almost 30,000 businesses have disappeared, according to industry data.
The President argues that jobs destroyed in one sector will be created in others able to compete internationally.
But Fernández believes the government is “living in a bubble” because “all we can see is that people who lose their jobs go and work for the apps.”
From the factory to driving an Uber
In Zárate, an industrial city 90 kilometres from the centre of Buenos Aires, Miguel Márquez looks with sorrow at the gates of the Clariant chemical products factory, where he worked for 20 years before it closed in 2025.
Grass is growing through the concrete in the empty car park and the sound of machinery has disappeared, replaced only by birdsong.
Márquez said only two of the 42 workers made redundant managed to find formal employment. The rest, like him at the age of 62, are getting by through informal work such as driving for Uber.
Clariant manufactured supplies for the oil industry during the boom at the Vaca Muerta shale formation, but decided to import the products from its plant in Brazil and close its operation in Argentina.
“Since they have no restrictions whatsoever, it makes more sense for them to bring them in from Brazil,” Márquez explained.
Argentina’s economy grew in 2025, driven by hydrocarbons, mining and agriculture. But the decline in commerce and industry is hitting the country’s major cities, where most of the population is concentrated.
Since 2023, more than 240,000 salaried private-sector jobs have been lost in Argentina.
Competition
Following the UIA’s appeal, Economy Minister Luis Caputo said his role was to “defend the interests of 48 million Argentines, not those of certain business owners.”
“For Argentines to have to pay two, four or 10 times more for lower-quality goods seems immoral and unfair to me,” he said, defending the opening of the economy.
But industrialists argue that the playing field is far from level.
“No-one wants to avoid competing, but you also have to have the conditions to compete,” Alejandro Mayer, the vice-president of Ernesto Mayer, a circuit manufacturing company on the northern outskirts of Buenos Aires, told AFP.
Half of the firm’s machines are now switched off.
Mayer points to an “overvalued exchange rate,” which makes locally produced goods expensive in dollar terms, alongside prohibitively high lending rates and a tax burden that makes it impossible to compete with products from countries such as China, even when efficiency levels are similar.
Milei has succeeded in bringing down the triple-digit inflation rate he inherited when he took office to 33.8 percent year-on-year in July – one of the government’s main economic achievements.
But “the economy cannot be measured solely by the evolution of inflation. We have to look at economic activity,” UIA president Martín Rappallini said.
Alongside competition from imported products, industrialists also point to weak consumer demand.
A few blocks from Mayer’s factory, Martin Blust, a manufacturer of strings for musical instruments employing 10 people, now closes on Fridays due to a lack of orders.
“There is no inflation because there are no purchases,” said its partner Gloria Aparicio.
According to various surveys, employment and wages have overtaken inflation as Argentines’ main concern – a warning sign for Milei, who will seek re-election in 2027.
At Kioshi, Fernández witnesses that anxiety first-hand. His employees ask him for salary advances to pay for transport to the factory.
“They’re frustrated and angry,” he said, and that “shows in their motivation and on the streets as well.”
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by Tomás Viola, AFP
