Argentina: Trade balance records largest accumulated deficit on record
In December, exports contracted 2.4% in year-on-year terms, an improvement from the revised 4.2% contraction observed in November (previously reported: -4.9% year-on-year). December’s contraction reflected a double-digit drop in manufacture of agricultural products, which more than offset an expansion in the three remaining components of the index. In dollar terms, exports reached USD 4.5 billion, edging down from previous month’s USD 4.6 billion and the USD 4.6 billion recorded in the corresponding month of 2016.
Growth in imports moderated from a 30.2% annual expansion in November to 16.7% in December. The deceleration was driven by a sharp slowdown in the imports of capital goods, which expanded just 0.2%, down from the 30.2% expansion observed in November. In dollar terms, imports reached USD 5.4 billion, below the previous month’s USD 6.2 billion and above the USD 4.6 billion recorded in December 2016.
As exports contracted and imports expanded at a strong rate, the trade balance swung from a USD 33 million surplus in December 2016 to a USD 847 million deficit in December 2017 (November 2017: USD 1.5 billion deficit). For the year 2017, the trade balance posted an accumulated deficit of USD 8.5 billion, below the USD 7.6 billion deficit recorded in the 12 months up to November. The trade deficit in 2017 exceeded the previous record of USD 5.7 billion, established in 1994.