Argentina’s Economic Activity Declines by 2.7% Amid Austerity Measures

Argentina’s economy contracted by 2.7% through October 2024, with significant declines in fishing and construction sectors, amid austerity measures by President Milei. While the administration suggests a recovery may be underway, the overall economic activity shows concerning trends according to Indec’s report.

A recent report by Argentina’s National Institute of Statistics and Census (Indec) indicates a concerning contraction in the country’s economic activity, which dropped by 0.7% in October. This decline has contributed to an overall reduction of 2.7% between January and October of 2024. Significant declines were noted in the fishing sector, which plummeted by 49.9%, and the construction sector, which fell by 14.5%, largely attributed to President Javier Milei’s austerity measures that have included a suspension of public works projects. Furthermore, community and social services experienced a 4.3% decrease, manufacturing contracted by 2.3%, and wholesale and retail trade dropped by 2.1%.

In spite of these figures, President Milei expressed optimism, suggesting that the 2.1% decline in gross domestic product (GDP) for the third quarter hinted at a recovery from the earlier decline observed in the April-June period, which he interpreted as a sign that the recession may be concluding. The Monthly Economic Activity Estimator (EMAE) has remained relatively stable for six months, showcasing improvements in several sectors, including mining and quarrying at 7.4% growth, agriculture at 2.3%, and financial services at 1.8%. The EMAE serves as a tool for economists to predict quarterly economic changes, having previously shown significant growth in the preceding years.

The economic landscape of Argentina has been heavily influenced by recent austerity measures implemented by President Javier Milei, whose administration has taken steps to reduce public spending. These measures have had significant implications for key sectors of the economy, resulting in contractions across various industries. The reports by Indec are critical for understanding the impacts of these policies and the overall state of the economy, particularly in light of previous indicators of growth and recovery.

In summary, the latest Indec report outlines a challenging economic situation for Argentina, marked by a 2.7% contraction in economic activity through October 2024, driven by significant decreases in critical sectors such as fishing and construction. Despite these adverse trends, President Milei maintains a hopeful outlook regarding the potential for economic recovery, reflecting on slight improvements in various sectors. The coming months will be crucial in determining the trajectory of Argentina’s economy under the current administration’s austerity measures.

Original Source: en.mercopress.com