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ECONOMY | 16-12-2021 16:47

Argentina’s economy posts strong third quarter rebound

Gross domestic product rose 11.9% in the third quarter from a year earlier, rebounding thanks to vaccination and the re-opening of activities.

Argentina's economy rebounded in the third quarter as its mass vaccination campaign gained momentum and the government stimulated activity by removing most of the Covid-19 confinement restrictions.

Gross domestic product rose 11.9 per cent in the quarter from a year earlier, just below analysts' estimates of 12 percent growth. The economy grew 4.1 per cent from the previous quarter, according to government data released on Thursday. The recovery followed a contraction in the second quarter.

Exports rose 7.3 per cent from the previous quarter, while public spending increased 3.4 per cent, boosting activity during the quarter, according to the INDEC national statistics bureau. President Alberto Fernández's government expects the economy to close this year with growth of close to 10 per cent.

However, the economy faces increasing headwinds. Uncertainty surrounding the government's negotiations with the International Monetary Fund for a new debt repayment programme could cloud the outlook in early 2022.

Recession and political volatility in Brazil, the country's largest trading partner, as well as forecasts of droughts that could hamper commodity exports, also pose risks to Argentina's post-pandemic economic recovery.

Economists surveyed by the Central Bank forecast the economy to grow by 9.7 per cent this year and 2.5 per cent in 2022.

 

– TIMES/BLOOMBERG

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by Patrick Gillespie, Bloomberg

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