Information regarding Argentina’s productive sector and the country’s macroeconomy.
Retail sales in small and medium enterprises (SMEs) fell 34.8% compared to the same month in 2019. In the Metropolitan Area of Buenos Aires, the fall was 49.3%, the rest of the country the fall was 20.3%. The gap is explained because in rural municipalities, with controlled cases of Covid-19, began the flexible quarantine.
Preliminary data from the National Institute of Statistics (INE) reflect a 5.6% contraction in the Bolivian economy during the cumulative period from January to April 2020. The World Bank predicted that the Bolivian economy will contract by 5.9% this year due to the effect of the pandemic, and the INE data seems to confirm this trend.
Argentines accumulate 222.8 billion dollars in money deposited abroad, safe deposit boxes, according to official data calculated to the first quarter of the year. Compared to the first quarter of 2019, those dollar assets grew 17.1%.
In June, there was again a drop in the collection of the leading national taxes levied on domestic operations. In both VAT and Profit, the real fall was 16.2%.
So far this year, amid the crisis caused by the pandemic, the government has managed to obtain financing of more than $4.7 billion from the IDB, CAF and the World Bank, among other organizations, with the clear objective of boosting the economy. Already, $800 million disbursed. The IDB will provide $1.8 billion, of which $300 million will go to reactivate SMEs.
In the first five months of the year, the industry sector executed 93.8% of the budget—71.1 billion pesos ($ 1,008 bn), which represents 2.9% of the total. The figure corresponds to the financing of production.
On Wednesday, the rating agency S&P lowered the rating of seven Argentine bonds denominated in dollars to “D” from “CC” because the country did not pay the maturity of $582 million in interest.
Bilateral trade with Brazil reached $1.1 billion during June, according to official data from the Brazilian government. It means a year-on-year contraction of 35%, the lowest level since 2003. The bilateral trade balance showed a deficit of $103 million for Argentina.
Although the national government estimates that in total it injected 5 points of the product into different direct and indirect programs to confront the pandemic, the amount spent up to May reaches 2% of the GDP. If we add to this the spending of June, the amount rises to 2.9%.
The stock of debt indexed to the dollar already amounts to u$s557 million so far this year, of which $472 million were closed in the last 40 days. This reflects the interest of issuers and investors. At the moment, there is idle liquidity and particularly voracious appetite of investors, but the problem is that when it devalues, that indexed debt is not going to be worth what it is now. It starts to be worthless because the exchange rate adjustment is over, the price goes up because of the devaluation and the next day the holders go out and sell it. This ends up complicating the BCRA, which today would already have sold positions for more than $4 billion.
