Argentina’s Consumer Price Index likely advanced 4% in November, according to a Reuters poll of economists on Tuesday, which would mark an acceleration from the month before amid swirling economic crises in the country.
Hopes of Argentina's new president Alberto Fernandez of bolstering exports to spur growth and pay debts face a speed bump from the crop industry, which accounts for more than a third of shipments. Drought has ravaged the wheat and barley crop on the Pampas growing belt that rakes in key export revenues over the new-year period.
Vaca Muerta has the capacity to generate some $10 billion a year in exports by 2024, according to YPF’s estimates, a number that could rise to $20 billion by 2029- 2030, providing much needed hard cash. But there are challenges ahead, sources in the industry suggest some $15 billion to $20 billion are needed yearly to fully tap into its potential.
Argentina's YPF has drilled the longest horizontal well to date in the oil window of Vaca Muerta, where the state-backed energy company is focusing its investment for oil and natural gas production growth. According to a company source, the well was drilled with a lateral of 3,890 meters (12,762 feet) in the shale play, and it is on Bandurria Sur, which YPF is developing in a joint venture with US-based Schlumberger.
Argentina’s incoming Economy Minister Martin Guzman should meet as soon as possible with the country’s private sector creditors amid fraught talks over restructuring, said the Institute of International Finance CEO Timothy Adams. Argentina’s new government is bracing for negotiations with creditors including the International Monetary Fund (IMF) to restructure around $100 billion in debt.
In 2019, the prices of the best-selling models increased between 60% and 80% but, in the last four years, the increase reaches 400% in some cases. In the same four-year period, accumulated inflation is around 160% while the exchange rate grew 541%. In other words, car prices rose significantly more than inflation but less than the dollar. The largest increase occurred in the last two years, following the strong devaluation that began in April 2018.
Two days after Alberto Fernández assumes as president of Argentina this week, bonds for an equivalent of $500 million will expire. In his first five days in office, the sum will rise to $750 million and in the first six months to $45 billion.
The largest solar energy park in Latin America, located in the province of Jujuy has been completed. The Cauchari Solar I complex which, together with Cauchari II and III, total a production capacity of 312 megawatts, which will be ready soon to inject energy to Argentina's national grid. According to Jujuy's Governor Gerardo Morales, the solar plant will generate an estimate income for the province of "$ 1 billion in 15 years".
Manufacturing activity accumulates a year-on-year decrease of 7.2%, according to the latest report of the National Institute of Statistics and Census (INDEC). The result is explained by the negative performance of the manufacturing subsectors, with stronger falls in cars and auto parts, machinery and equipment, chemicals and clothing. On the other hand, construction activity had a fall of 9.5% in October compared to the same month last year, while in ten months accumulates a decrease of 8.3%.
The Province of Buenos Aires is unlikely to have the cash to pay investors $571 million in January 2020. Of note, the province’s $500 million of bonds maturing in 2021 are already trading at about 50 cents on the dollar. To make matters worse for bondholders, their adversary in any restructuring talks will be Axel Kicillof, known as the economy minister who fought the tail end of an epic battle with debt investors after the nation’s $95 billion default in 2001.