The suspension of the construction of the third Argentine satellite Arsat III damaged the State in $38 million since it left with the obligation to face payments of pending contracts in dollars and euros. Irregularities are reported, such as direct hiring and benefits to related companies. Many provinces left without the expected connectivity.
The provinces are preparing to give up their participation in the distribution of resources with Nación: they will go from receiving 49.6% in 2019 to 48.3% in 2020 (1.3% less) and 47.3% (2.3% less) in 2021. The provinces will lose more than 200,000 million pesos ($2.6 bn) due to the lack of co-participation of the PAIS tax to the dollar. Since this tax was created, the resigned amount will accumulate until the end of next year 306,809 million pesos ($4.05 bn). The one that lost the most was Buenos Aires, with 64.075 million pesos ($845.4 mn) less.
The first eight months of 2020 result in an 11.8% drop in exports, and a more pronounced 23.8% reduction in imports, only primary products had a positive variation of 10.2%, in a context of extreme scarcity of foreign currency. Exports reached $4.94 billion and imports $3.5 billion. The commercial exchange (exports plus imports) decreased by 15.3% concerning the same period of the previous year. A surplus of $1.44 billion is not good news in this context of the economy in a deep recession. If it grows again, that surplus will reduce rapidly. The bad news added to the data of the fall of the GDP and employment in Argentina.
According to INDEC, half of the people employed in Q2 2020, received a monthly amount of up to 27,000 pesos ($355), while the average income of those occupied was 31,868 pesos ($420). Statistics show that the labour income obtained by the population increased nominally by 15% concerning the second quarter of 2019; below inflation, with a drop of almost 20% in real terms. It anticipates a sharp increase in poverty and indigence levels. Also, social income inequality has widened.
Due to the fall in the population's income, especially those with fewer resources, poverty will reach 46% of the urban population in the second quarter of the year. This figure projects to the entire country, including the rural community, which is 20.8 million people who lived with incomes below the poverty line.
According to data from the INDEC, the unemployment rate was 13.1% between April and June, 2.5 points more than in the same period in 2019, which was 10.6%. The total loss of jobs was 3.9 million. The 2020's Q2 was the most affected by the quarantine due to coronavirus, with a GDP's fall of 19.1% year-on-year.
Estimates for the 2020/21 campaign detail that total grain production would be 120.8 million tons, which shows a drop of 6.1% concerning the previous cycle, while income from exports would show a contraction of 3% to reach $25.15 billion.
Moody's estimates that communication A 7106, which restricts the access of indebted companies to the official dollar market to cancel their obligations, will harm the capacity of local companies to pay in time and form. For the financial firm, the capital maturities of negotiable obligations (corporate bonds) between October 15, 2020, and March 31, 2021 (the period in which, in principle, this limitation applies) total $12.53 million.
Due to strict restrictions on mobility and production to prevent the spread of Covid-19, Argentina's Gross Domestic Product (GDP) plummeted by 19.1% in the second quarter of 2020, compared to the same period last year. Thus, it accumulated a 12.6% year-on-year contraction in the first semester.
The shares of Argentine companies fell after the settlement of the sovereign debt, the destruction of the value of companies listed in New York shows it: $ 13 billion were lost from August 3, one day before the settlement of the debt, until Friday last week, a fall of 17%. The figure comes from comparing the stock market capitalization of 14 Argentine companies that quoted on the US market; the banks were the most affected.