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Argentina economic activity slumps 4.2% in April as drought hit farming

Published 06/30/2023, 03:33 PM
Updated 06/30/2023, 07:01 PM
© Reuters

By Hernan Nessi

BUENOS AIRES (Reuters) - Argentina's economic slumped 4.2% in April from a year earlier, the country's official INDEC statistics agency said on Friday, the worst drop since October 2020 and far lower than the 1.5% decline forecast by analysts as farming production slid.

The South American nation is the world's top exporter of processed soy, the No. 3 for corn and an important wheat supplier, but the most recent harvest was pummeled by one of the country's worst droughts in history.

Government data showed that agriculture and fishing had the worst results for the month, with the former the main driver of the overall activity decline. The 'EMAE' activity index is a useful early indicator of likely economic growth.

© Reuters. FILE PHOTO: A general view of a farm shows dried corn and cotton that was planted where corn was ruined by the weather, amid Argentina's worst drought in sixty years, in Tostado, northern Santa Fe Argentina February 8, 2023. REUTERS/Miguel Lo Bianco/File Photo

"These two sectors contributed four percentage points to the year-on-year drop in the EMAE," INDEC said.

Argentina is battling inflation of over 100% and a weak peso currency, with around four-in-10 people living in poverty. It is also locked in crunch talks with the International Monetary Fund (IMF) to revamp a $44 billion debt deal.



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