The INDEC publication calendar says that this Monday at 4 pm this body will tell the country what happened to the Argentine economy in April. The number of the monthly economic activity estimator (EMAE) will mark the disaster that signified the pandemic of COVID-19 and the inevitable quarantine that the Government of Alberto Fernández had to apply.
Estimates by private analysts indicate that the fall of the economy will be at least 20% in relation to April 2019. Some stretch up to 25%. In any case, it will be for him Guinness. There is no record of a crash of this magnitude for a single month of the year.
In April They lowered the lever on the economy. No cars were produced, sales in shopping malls fell to 0, industrial activity stalled, and energy demand plummeted. The construction works stopped. Only the sector of the feeding remained operational. And the field kept working, selling the harvest or storing it in the silo bags that are newsworthy today due to repeated vandalism attacks in various fields.
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To sell a little optimism, from the Government, with the President at the head, it was said these days that the worst was over and that in May several branches of production had restarted their engines. It is true: surely the May numbers will be very bad in the year-on-year comparison but better in the comparison against April of this year.
The problem is that the new and tougher quarantine that starts on July 1 is going to complicate that expected rebound, With which the way out of the recession will be more laborious.
In fact, there are those who say that the IMF forecast, which this week indicated that it expects a 9.9% drop in GDP for Argentina, sounds optimistic.
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The Economist Gabriel Rubinstein he told this newspaper that he expects a contraction in the GDP of at least 12%, precisely because it does not perceive that the economic measures that the Government took and is taking help to regenerate confidence. “I fear we will suffer an economic downturn worse than the countries average and that our way out of the crisis is the slowest of all, ”admitted Rubinstein, who stated that the Government should not be afraid to inject even more pesos than it has injected so far, “Because today the priority is to prevent companies from dying.”
The consultant Fernando Marull He pointed out that “today there is data to project that the economy will have fallen 25% in April, a slip that exceeds the fall of 15% year-on-year in December 2001 -the end of Convertibility- and 16% year-on-year in January 2002. April was blackout month. And in May a rebound is expected, because, for example, cement shipments grew 60% and car production also grew. But you have to see what happens with that rebound, because if he stops again and loses clean and jerk, it will be difficult to lift again. Minimally the fall in GDP will be 12% this year, “he says.
“The main problem facing the economy today is quarantine, not only because of the strong impact it is having on the level of activity, but also because it is not clear that the chosen strategy was the correct one. This causes the prospects for the normalization of activities to drift away and even back off, given the risk of making the quarantine even stricter, “says the economist. Martin Polo. And he adds: “The impact of quarantine on activity forces systematic downward correction projections. For the second quarter GDP would mark a fall of the order of 20% year-on-year and for the whole year the contraction would reach 10% ”.
At the consultancy Echolatin they look to the future with concern. “For the coming months, the main concern lies in the closure of companies and the possible permanent reduction of the ‘capital stock’ that it will entail. Likewise, even when the quarantine is over, there will be greater precautionary savings upon departure due to fear This will have caused the crisis and the collapse of economic activity will extend beyond what the confinement lasts for. “
So far a part of the numbers projected by analysts regarding production. It is, if you will, the deteriorated “facade” of the Argentine economy in times of quarantine. But to this we must add what is also evident. The severe deterioration of socio-economic indicators -poverty, unemployment– which will also make an important leap in the coming months.
