Argentina: Trade surplus continues to narrow in October
November 26, 2014
In October, exports decreased 16.5% over the same month last year, which was down from the 12.1% contraction tallied in September. The decrease in October was broad-based, with the exception of exports of primary products which showed a slight increase.
On a monthly basis, exports fell 0.7% in seasonally-adjusted terms in October, which was notably up from the 3.0% decline recorded in the previous month.
Imports fell 14.4% annually in October, which was a much more pronounced contraction than the 8.4% decline recorded in September. The largest decreases were recorded in automobiles and capital goods. The trade surplus totaled USD 361 million in October, which was down from the USD 594 million surplus recorded in October 2013. October’s trade balance was also lower than the USD 404 million surplus recorded in the previous month and undershot the USD 500 million surplus that the market had expected. In the 12 months up to October, the trade balance posted an accumulated USD 7.0 billion surplus, which was below September’s USD 7.2 billion.
According to analysts, Argentinean imports have been heavily damaged by tough government import restrictions and weaker domestic demand. Exports have been falling rapidly as well due to the slowdown in Brazil and China, two of the country’s top trading partners. Argentina has had no access to international financial markets since the default in 2001 and therefore it depends heavily on its exports to draw the foreign exchange reserves required to fulfill its debt obligations.
Author: Cecilia Simkievich, Economist