The seasonally adjusted index showed a positive monthly variation of 2.1%, below the 16.5% shown in June concerning May. The accumulated January-July index presented a 13.4% decrease for the same period in 2019. According to INDEC's Industrial Production Index, a 6.9% year-on-year drop was recorded in July, accelerating the contraction shown in June (6.3%).
Automotive production will close 2020 with a level of activity of some 250,000 units, according to manufacturers' estimates. In the first eight months of the year, the automotive sector produced 133,590 units, a volume that was 37.5% lower than the 213,643 units produced in the same period in 2019. It is the data taken by the sector to venture a year-end volume of 250,000 units.
The government is betting on a conservative estimate: it projects a firm but moderate recovery for 2021, that will be close to or even below the 5.6% shown by the Market Expectations Survey (REM) prepared by the Central Bank. The International Monetary Fund forecasts a fall of 9.9% for this year and a recovery of 3.9% for 2021.
This week, the Argentine Industrial Union presented to the Government a series of proposals for the reactivation of production, accompanied by a severe diagnosis on the impact of the pandemic on the productive sectors. The data showed that 63% of the companies were not producing or had fallen more significant than 50%. The last UIA report highlighted that production and sales indicators improved but a considerable number of companies are still far from pre-pandemic levels. The report highlighted the high level of delinquency: 31% of the companies surveyed were unable to pay taxes, and there were also financial defaults, in payment to suppliers and the settlement of the half-year bonus.
The governor of Neuquén estimated that in the current context, investments in Vaca Muerta this year will be around $3 billion while the amount needed for its development is between $5 and $10 billion. Even though we have managed to triple the production since the exploitation of Vaca Muerta began, and the average cost of each well has dropped from 25 to 9 million dollars, we must continue to improve to gain competitiveness.