Indec Reports 2.7% Economic Contraction in Argentina through October 2024

A report from Argentina’s Indec shows a 0.7% decline in economic activity for October, marking a 2.7% contraction in the first ten months of 2024. The fishing and construction sectors faced the largest decreases due to austerity measures by President Javier Milei. Despite an overall downturn, some sectors, including mining and agriculture, displayed growth, indicating potential recovery.

On Friday, Argentina’s National Institute of Statistics and Census (Indec) reported a 0.7% decrease in economic activity for October, culminating in a total contraction of 2.7% for the first ten months of 2024. This decline was heavily influenced by significant reductions in the fishing sector, which contracted by an alarming 49.9%, and a 14.5% drop in construction, both of which are in response to President Javier Milei’s stringent austerity measures that included the suspension of public works projects.

Additionally, community and social service activities saw a decline of 4.3%, while the manufacturing industry contracted by 2.3%, and wholesale and retail trade decreased by 2.1%. Despite these challenges, President Milei expressed optimism as the gross domestic product (GDP) showed a 3.9% recovery from the previous quarter’s decline, indicating a potential end to the recession.

The Monthly Economic Activity Estimator (EMAE) maintained stability over the past six months and noted improvements in five sectors. Notably, mining and quarrying grew by 7.4%, with agriculture, livestock, hunting, and forestry increasing by 2.3%, and financial services by 1.8%. The EMAE serves as a reliable gauge of monthly economic activity across various sectors, providing vital insights for economists, despite a reporting lag of 50 to 60 days. Historical data shows the EMAE recorded growth rates of 10.3% in 2021 and 6.4% in June 2022, underscoring its importance in economic monitoring.

Argentina is presently grappling with various economic challenges as indicated by the Indec’s latest report. The significant contraction of 2.7% for the first ten months of 2024 highlights the impact of austerity measures implemented by President Javier Milei. These measures, including the halt of public works, have particularly affected sectors such as fishing and construction, which are critical to the Argentine economy. The context of a declining GDP and efforts to stabilize economic activity is crucial for understanding the implications of this report.

In conclusion, the recent report by Indec reveals a troubling contraction in Argentina’s economy, significantly influenced by President Javier Milei’s austere policies. While there are signs of stabilization in certain sectors, the pervasive declines in key areas such as construction and fishing signal ongoing economic challenges. The economic outlook will depend on the effectiveness of current policies and the ability of various sectors to recover from recent losses.

Original Source: en.mercopress.com