April 3, 2017 / 4:52 PM / a year ago

Argentina announces new labor deal to spur construction sector

BUENOS AIRES, April 3 (Reuters) - Argentina’s government announced on Monday an agreement with unions and banks to lower labor costs in the construction sector, mimicking similar deals in the oil and auto workers as part of the government’s effort to create jobs.

President Mauricio Macri is trying to attract investment to drive an incipient economic recovery before mid-term elections in Congress later this year.

The sector-specific agreements this year have lowered income taxes while making concession to labor unions aimed at increasing jobs. In announcing the agreement, Macri said on local television that construction for public works projects was already taking off but private sector building had lagged.

“Now we need to give impulse to private construction,” he said.

As part of the deal, banks promised to give 30-year loans at rates lower than those offered in the markets. The province of Buenos Aires will lower mortgage rates as part of the pact in an effort at inducing more mortgage lending.

Interior Minister Rogelio Frigerio said other provinces would follow the same tax-cut model in coming weeks. (Reporting by Juliana Castilla; Writing by Caroline Stauffer and Hugh Bronstein; Editing by Alistair Bell)

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