The government will launch a AR$5 billion relief fund for farmers who took considerable losses amid a historic drought, Economy Minister Sergio Massa announced this Tuesday.

According to Rosario’s Stock Market (BCR), losses – a product of what is considered to be Argentina’s driest recorded summer – could reach US$10.4 billion in soybean, wheat and corn harvests. The BCR also calculated that the climate emergency will have a total negative impact of US$14.19 billion, 2.2% of the country’s GDP.

After a meeting between Massa and the Liaison Board, the Minister said that the assistance system will work “through a revolving fund”, and will be articulated through provincial and municipal governments.

According to Massa, Santa Fe, Entre Ríos, Corrientes and Chaco have declared a total emergency, and Salta, Córdoba and Buenos Aires declared a partial one. “We are speaking about a universe of 54,100 producers that will be covered by these measures,” Massa said. Although recent rains “brought some relief,” the drought has already caused significant damage, Massa said.

Massa also announced other measures, such as the suspension of advance income tax payments for producers in areas hardest hit by the drought, smaller interest rates, and bigger subsidies. Another decision, that will benefit some 4,200 beef producers, is the exemption of the income tax for those who undersold their cattle due to a lack of food caused by the drought.

Moreover, the Nación Bank will raise subsidies for producers by AR$50 billion, and the Central Bank board will repeal the decision to increase credit rates for producers who cashed in their export income at the special “soy dollar” rate.

“Maybe this is not everything you asked for, I know that,” Massa said in a statement. “It’s what we can do at this time. We understand it’s robust enough for our farmers.”

-Herald/Reuters