Argentina’s economy shrank 9.9% in 2020 year-on-year due to the coronavirus pandemic, its worst fall in nearly 20 years, the national statistics institute INDEC announced on Tuesday.
The fall – the worst since GDP fell by 10.9% in 2002 – was not, however, as severe as the 11.8% drop initially forecast by the IMF. It is, however, one of the largest contractions recorded in Latin America.
In terms of bright spots, GDP grew 4.5% in the fourth quarter of the year compared to the previous one. However, compared to the same period in 2019, the fourth quarter recorded a decrease of 4.3%.
Measures were down across the board, INDEC said, with consumption down 13.1% and investment down 13% from the previous year. Exports decreased by 17.7% and imports by 18.1% compared to 2019.
The sectors most affected were hotels and restaurants (down 49.2%), community, social and personal services (down 38.9) and construction (down 22.6).
Fishing (down 20.9%), domestic services (down 18.6), transport and communications (down 17) and mining (down 10.5) were also hard hit.
Imports fell by 18.1%, exports by 17.7%, consumption by 13.1% and investment slowed by 13%.
Manufacturing was not as badly affected but still fell 7.7 percent.
On the other hand, financial mediation increased by 2.1% and electricity, gas and water increased by 0.9%.
The worst time in 2020 was between April and May, when measures to restrict the spread of the coronavirus were most stringent.
The data means 2020 is now officially Argentina’s third year of recession, following contractions of 2.6% in 2018 and 2.2% in 2019. The country also has one of the lowest inflation rates. highest in the world (40.7% from March 2020 to February 2021, while poverty now affects 40.9% of the population.
The IMF has forecast the economy to rebound 4.5%, although the government expects this figure to be closer to 7%.
– TIME / AFP