Austerity bites: Argentina's subway fares surge by 360% overnight

Subway passengers in the capital of Argentina, Buenos Aires, had to pay 360% more for tickets on Friday compared to the previous day. This is one of the most drastic increases linked to President Javier Milei's austerity policies.

Ticket prices for a single subway ride in Buenos Aires, the oldest in Latin America, rose from 125 pesos (around CAD 0.46) to 574 pesos (CAD 2.11). This came as a result of the court's decision to lift the temporary price freeze imposed at the request of the leftist opposition.

According to the authorities of the Argentine capital and the subway management company SBASE, the increase is necessary due to rising operational costs resulting from inflation. Inflation stands at nearly 290 percent annually.

Further increases have been announced for the coming months. Tickets will cost 650 pesos (CAD 2.39) starting in June and 757 pesos (CAD 2.79) starting in August.

Public transportation ticket prices are a sensitive issue in Latin America, with significant social inequality. In 2019, a relatively small increase in subway fares in Santiago triggered large anti-government protests and riots in Chile.

Rising transportation costs are one element of the drastic increase in the cost of living in Argentina, where, according to some estimates, half of the population lives below the poverty line. The financial situation of many families has further deteriorated due to the liberal reforms introduced by the president sworn in last December.

Milei cut transport subsidies, unfroze the prices of some goods, and devalued the peso against the dollar, contributing to the sharp increase in the cost of living. He also lowered real pensions and salaries in the public sector. The president claims that the reforms are necessary to pull Argentina out of the crisis and curb inflation, and the country achieved a budget surplus in the early months of the year.