Patagonian province on war footing over Milei’s threat to industry

A gust of sub-Antarctic wind lashes factory worker Claudia Tigüel as she camps outside a factory at the southern tip of Argentina. Alongside her, thousands are fighting to maintain mobile phone production in the region, which is under threat from news measures introduced by President Javier Milei.

“The factories are my life,” she explains, concerned.

In Tierra del Fuego, an island province located 1,000 km from Antarctica and 3,000 km from Buenos Aires, most of the firms were established there thanks to a system of tax exemptions for the electronics sector.

But a recent decree issued by free-market advocate Milei announced the gradual removal of import tariffs on mobile phones, to encourage more competitive pricing and bring cheaper products to consumers.

In response, workers from mobile phone factories in Tierra del Fuego – an industry employing around 8,500 people – called a general strike, taking to the streets for demonstrations on Wednesday.

The protest drew thousands to Ushuaia, the windswept provincial capital known as “the city at the end of the world.” Marchers followed the course of Beagle Channel into the city centre, enduring temperatures of minus four degrees Celsius.

“We are fighting for our jobs; many families depend on this industry,” said Paula Mayor, a worker at NewSan, one of the country’s leading manufacturers of household appliances and mobile phones.

When the government’s plan was announced last week, around 20 workers immediately set up camp in a tent outside a NewSan plant, keeping warm by burning fires in three empty oil barrels.

Among them is Tigüel. “Half my life is here. It’s impossible not to feel overwhelmed by what’s happening to us,” said the 48-year-old.

A law passed in 1972 exempts both residents and companies in the region from taxes. It was adopted to encourage settlement in an area of major geopolitical significance, which has grown from 13,000 inhabitants at the time to some 190,000 today.

“The factories are part of this place’s identity. Many people came here from all over the country to work. It’s thanks to them that the area became populated,” Tigüel explains.

Jobs at stake

Mobile phone import tariffs will drop from 16 percent to eight percent in the first phase of Milei’s plan, before dropping to zero in January 2026.

This “puts the future of the province and thousands of families at risk,” Governor Gustavo Melella said in a post on the X social network.

Luis Galli, CEO of the Newsan Group, warned that the consequences “will be severe.”

Economist Juan Pablo de Luca estimates that “3,500 to 4,000 jobs” will be lost.

“Promoted industry accounts for about 35 percent of Tierra del Fuego’s economy, including one in four private-sector jobs. Salaries alone represent US$10 million per month,” he explained.

The main criticism of the local production model lies in its fiscal cost, due to tax exemptions. According to research centre Fundar, the government forgoes US$1.07 billion annually due to the region’s industrial regime – 0.22 percent of GDP.

The Tierra del Fuego provincial statistics institute reports that over 10 million Samsung, Motorola, TCL, ZTE and Alcatel mobile phones, among others, have been manufactured in 2024, supplying 96 percent of the national market.

But Milei’s Cabinet Chief Guillermo Francos, argues that factories in Tierra del Fuego merely “assemble products that arrive disassembled from abroad.”

Presidential Spokesperson Manuel Adorni claims that “in Argentina, a 5G mobile phone costs twice as much as in Brazil or the United States” and that prices could fall by up to 30 percent through imports, in addition to a reduction in “smuggling and mobile phone theft.”

‘My life’

Back outside the Ushuaia plant, Claudia’s colleagues stand to brace the plastic tent against the howling wind.

“The factory is my life. I grew up here. After working so long in one place, your colleagues become like family,” the worker says.

Raúl Caucota, who has worked the same job for 35 years, nods beside her. “In my case, it’s even worse. At my age, I wouldn’t be able to get another job,” he sighs.

Decades ago, Raúl moved from the opposite end of the country, northern Jujuy Province, to the south, seeking opportunities to build a future and raise a family.

“It started out as just a job, but now it’s part of who we are. It’s a way of life we’ll defend by any means necessary,” he declared.