Argentine economy recovers in August to pre-pandemic levels

[peppertree]

Argentina's Statistics and Census Institute (INDEC) reported today that August GDP recovered to its highest level since October 2019 - its first monthly reading above February 2020 pre-COVID levels for the first time since the start of the pandemic.

GDP grew 1.1% in August, and 12.8% from a year earlier.

The nation's economy - the third-largest in Latin America - grew by 10.8% so far this year, after plummeting 9.9% in 2020.

Growth in August was led by recreational and other services (77.4%) and tourism (35%) - the hardest-hit sectors by crowding and travel restrictions in force during much of 2020.

These sectors however remain 17.7% and 42.3% below August 2019 levels, respectively.

Strong growth was also seen in construction (26.7%), retail and wholesale (15.6%), and manufacturing (13.7%) - all showing improvements over 2019 averages of 5.3%, 11.3%, and 10.4%, respectively.

Fixed investment in August in turn jumped by 26.3% from a year earlier according to Orlando Ferreres, a top local macroeconomy consultant - its highest level in two years.

Argentina's recovery - which outperformed initial IMF projections of 4.5% growth - prompted a jump in imports in the first nine months of 2021 of 51.5% (34.5% by volume).

But a sharp rise in export prices (with volume up 10%) allowed merchandise trade surpluses so far this year to edge up to $12.3 billion - though most is devoted to servicing Argentina's $190 billion public foreign debt, which had doubled during the 2015-19 Mauricio Macri administration.

At: https://www-eldestapeweb-com.translate.goog/economia/indec/la-actividad-economica-subio-1-1-y-supero-por-primera-vez-el-nivel-previo-a-la-pandemia-2021102116200?_x_tr_sl=auto&_x_tr_tl=en&_x_tr_hl=en-US&_x_tr_pto=nui

Crowds enjoy seaside Mar del Plata during the October 8-11th long weekend - the first since occupancy and crowding restrictions were lifted in Argentina in late September.

Though growth rates have slowed since January amid rising inflation, GDP grew 10.8% in the first 8 months of 2021 year-on-year.

But three years of recession still left August 2021 GDP some 7% below its early 2018 highs, before the "Macrisis" debt bubble collapse and later Covid-related restrictions battered the nation's economy.

[Judi Lynn]

1. Unbelievable achievement, considering what a catastrophe Macri had wrought before leaving office!

I hope there are enough people who will take the time to see beyond the fact things are improved this much in such a short time span. The country was horrendously ravaged by Macri's corruption and the power his administration amassed through greed, coersion, and relentless ill will.

It was such a great surprise seeing this new report. Thank you, peppertree!

[peppertree]

2. They've certainly had their work cut out for them

What with the pandemic besides! (can you imagine an utterly bankrupt country having to deal with all that at once)

Of course, inflation has proven much harder to tackle - in fact, outright impossible (52%!).

And that has hurt Fernández's mostly working-class base hardest - which may explain why so many stayed home in the first round.

Should the right-wing gorilas (as they're called down there) win in the second round 3 weeks from now, they'll put Mary "Opus Dei" Vidal in as House Speaker.

The idea would be to then provoke a financial collapse, with the help of right-wing bankers and the agro-export sector, and then demand that Vidal be installed as president.

Not that different from what many in the GOP want to do to Biden now, really.

Thanks as always for taking the time to read, reflect, and react to these stories Judi. Have a breezy and restful weekend.