In Argentina, Inflation Passes 100% (and the Restaurants Are Packed)

Wine glasses clinked in an Art Nouveau culinary gem basking in its restored splendor. It was tasting night in the more than century-old coffeehouse turned restaurant at the old Buenos Aires zoo, as beet tartare, pan-seared squid and a perfect rib-eye floated out of the kitchen, chased by a velvety chocolate mousse.

“As you can see, we are betting hard on the opportunity of the food scene in Argentina,” said Pedro Díaz Flores, on a tour of the restaurant, Águila Pabellon, that he co-owns — the 17th food venture he has opened in Buenos Aires in the past 18 months.

In Buenos Aires, Argentina’s cosmopolitan capital, a world-class culinary scene is flourishing. That would not necessarily be news if it were not for the fact that Argentina is in the middle of an extraordinary financial crisis.

Inflation is at more than 114 percent — the fourth highest rate in the world — and the street value of the Argentine peso has crumbled, dropping about 25 percent over a three-week period in April.

Yet it is the peso’s downfall that is fueling the restaurant industry’s upswing. Argentines are eager to get rid of the currency as quickly as they can, and that means the middle and upper classes are going out to eat more often — and that restaurateurs and chefs are plunging their revenues back into new restaurants.

“Crises are opportunities,” said Jorge Ferrari, a longtime restaurant owner who recently reopened a historic German eatery that had shut down during the pandemic. “There are people who buy cryptocurrencies. There are people who go toward other sorts of capital markets. This is what I know how to do.”

The boom, in a way, is a facade. Everyone appears to be out having a good time. Yet, in much of the country, Argentines are scraping by and hunger is on the rise.

And in wealthier circles, the rush to go out is a symptom of a shrinking middle class that, no longer able to afford bigger purchases or travel, is choosing to live in the here and now because people do not know what tomorrow will bring — or if their money will be worth anything.

“The consumption that you have is consumption for satisfaction — happiness in the moment,” Mr. Ferrari said.

The city of Buenos Aires, which has been trying to promote its culinary scene, has been tracking the volume of plates sold at a sample of restaurants each month since 2015. The most recent numbers, for April, show that restaurant attendance is at one of its highest levels since tracking began, and 20 percent higher than at its highest point in 2019, before the coronavirus pandemic began.

It is not just venerable hot spots that are thriving. In Buenos Aires, under-the-radar residential zones have suddenly become destinations for foodie influencers, which then quickly leads to new crowds of porteños, as residents of the capital city are known.

There are cocktail bars with mixology magicians, drag shows while you dine, vegan bakeries, verdant patios and fusions of global cuisines from chefs who apprenticed in kitchens all over the world. One “it” spot, Anchoita, a modern twist on Argentine fare, has no reservations available until next year.

While the devaluing currency has also drawn tourists back to Buenos Aires as the pandemic has ebbed, it is the locals who are out in full force.

The restaurant boom is a phenomenon that cuts across classes, said Santiago Manoukian, an economist at a Buenos Aires consulting firm, Ecolatina, though it is largely driven by middle- and upper-income earners, many of whom have had their earnings keep up with inflation, but have still had to adjust to the crisis.

For members of the middle class in particular, expenditures like a vacation or a car have become largely out of reach, so they are indulging in other ways.

But even lower-income gig workers, who saw their earnings shrink by 35 percent since 2017, according to data gathered by Ecolatina, are dining out before their money devalues even more, Mr. Manoukian said.

“It’s a product of the distortions that the Argentine economy suffers from,” he said. “You have extra pesos that are going up in smoke because of inflation, and you have to do something because you know the worst thing you can do is nothing.”

In an orchard in Buenos Aires next to a tennis court, Lupe García, who owns four restaurants in the city and another just outside it, reached down and broke off what looked like a miniature watermelon but was actually a cucamelon, a fruit about the size of a blackberry.

She was surrounded by lettuce, parsley, mint, alfalfa and purple shiso leaves used for tempura in one of her restaurants. The garden, owned by Ms. García and run by agronomists from the University of Buenos Aires, reflects the changing taste of locals, which Ms. García’s dining venues have helped cultivate.

She opened her latest establishment, Orno, a Neapolitan- and Detroit-style pizzeria, in February in the trendy neighborhood of Palermo.

Still, though the inflation crisis has brought more customers to restaurants, it has also added another layer of complexity to their operations.

To save on expenses, Ms. García has swapped printed menus in all of her restaurants for QR codes for websites that her team can quickly modify.

“Your provider brings you beef, and they tell you it’s 20 percent more,” she said, “and you have to turn around and raise all the prices.”

Nevertheless, Ms. García said, the explosion of restaurant openings makes it an exciting time to be in the business, as competitors brainstorm how to creatively bring in diners.

“It’s also in the DNA of porteños to go out every day,” she noted. “I don’t know if there are many cities where people go out as much as they do in Buenos Aires.”

At a bustling new street-food strip in an alley near Buenos Aires’s Chinatown, Victoria Palleros was waiting for noodles at Orei, a ramen hot spot that often sells out.

“I think the generation before us thinks more about saving, but not us,” said Ms. Palleros, 29, a government worker.

Many Argentines purchase physical U.S. dollars to save, but “buying $100 is almost half of a young person’s monthly salary,” she said, adding, “And, honestly, I think you’d rather make plans like these and live well during the week, rather than live really tight every month.”

Ms. Palleros would love to be able to save up to buy an apartment, she said, but that is impossible.

Mariano Vilches and Natalia Vela, a married couple who found themselves amid hordes of people at a Sunday afternoon French food fair, came to a similar conclusion about enjoying life as much as they can despite the economic hardships.

Ms. Vela, 39, an administrative assistant, said they could no longer afford to travel, but still eat out roughly three times a month. “It also satisfies a basic need,” added Mr. Vilches, 43, a real estate agent. “You have to eat. You don’t have to buy that coat.”

As a result, places like Miramar, in the working-class neighborhood of San Cristóbal, have remained packed at lunch and dinner. The iconic eatery, with salami dangling at the entrance and pictures of tango lyricists framed on the wall, has seen its share of financial crises since its doors first opened in 1950.

But now, even as Argentina enters perhaps one of its worst economic moments, Miramar is busier than ever, said Juan Mazza, the manager.

“I don’t know if it’s a contradiction,” he said. “The crisis is here. So with the little money that I have, I want to enjoy.”

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