Camuzzi Gas Pampeana




With tariff increases, TGS (MERV:TGSU; NYSE:TGS) and Camuzzi Gas Pampeana (MERV:CGPA) retrieved attractive 3 July 2009 the question was waiting until after the elections. Argentine businessmen knew that until the 28-J could not nor thinking about the possibility of price increases.Probably some secret arrangement there existed and this would explain the official silence to which we are witnessing. The Argentine newspaper El Cronista yesterday analysed changes in the behaviour of the local investor who is putting their attention on roles of the financial sector and services. Among the latter, the tariff adjustments which are expected shortly, increased the attractiveness of public service companies, but convinced me that something changed in the Argentine economy. And that change was not out of conviction but because of need. So far have been those times where the Government could maintain artificial and relatively stable prices in the economy.

So for example, the rates of public utilities, such as electricity and gas, thanks to the thousands of millions of pesos that were used in the form of subsidies, remained stable while international energy prices climbed steadily reaching levels historic records. Argentines thus witnessed a deception that cost them a huge amount of resources. After all, the billions of pesos to subsidize unrealistic prices, came out of pockets of the Argentine families, only that the same, nor noticed this. But what is serious is that the end result is much worse now that the tariff freeze (and the poor government intervention), it reduced the incentive to invest by companies in the sector generating serious problems that currently are dissembling thanks to the impact of the crisis on energy demand. But the crisis and serious errors of economic policy, removed box to the Government and as if it represents the hair of Samson, without the box, the Government has lost almost all their power and must accept tariff increases in order to reduce subsidies.