Buenos Aires Times

Economy in brief: 4.3% growth in third quarter

Take a look at the main stories from the last week.

Sunday 24 December, 2017
Argentina's foreign debt rose 20.3 percent in the year from the third quarter of 2016 to the same period in 2017.
Argentina's foreign debt rose 20.3 percent in the year from the third quarter of 2016 to the same period in 2017. Foto:Cedoc

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The good news is that Argentina grew in the third consecutive quarter of 20117, the bad news is that the balance of payments has almost trebled its deficit since lastyear, rising to US$8.68 billion in the third quarter as against US$2.9 billion in the same period last year. On Wednesday INDEC statistics bureau posted a positive 4.2 percent growth rate for the third quarter, the highest since 2013. For five quarters running the economy has now been growing as against the previous quarter although not necessarily the same period in the previous year. A mushrooming trade deficit and borrowing abroad are the main factors, behind the deterioration in the balance of payments. A separate INDEC report on Thursday indicated that foreign debt rose to US$216 billion in 2017, up 20.3 percent on 2016’s total foreign debt. The accumulation of foreign debt accelerated during 2017, the report indicated. In the second quarter of 2017 alone there was a 5.5 percent increase in foreign debt to US$204.91 billion. The country posted a primary fiscal deficit worth 29.66 billion pesos (US$1.67 billion) in November, the government also said on Wednesday, up from 14 billion pesos the same month last year and down from 32.49 billion pesos last month.


Low-cost airlines told the Reuters news agency this week that they were planning to introduce new flights between Latin American capitals as they seek to expand operations in the sky. Representatives from Avianca, Flybondi and Andes said they intend to offer more routes to countries including Brazil, Chile, Peru and Uruguay in 2018, targeting the national capitals.


In a wide-ranging speech at the 51st Mercosur Summit in Brasilia, Brazil on Thursday, President Mauricio Macri reiterated his concerns about the situation in Venezuela, as politics overrode talks over the longtrailed free-trade deal with the European Union. Macri called for “human rights to be respected” in Venezuela, a once full member of the group that has been barred since 2006. Macri has generally been seen as critical of the Mercosur. However, he reaffirmed his country’s “commitment” to the sub-regional bloc and called for a “Mercosur for the 21st century.” On the economic front, the president said he looked forward to finally signing off on a trade deal with the EU, which he labelled “particularly relevant in attempts to attract investment and encourage employment.” Technicians from both blocs are trying to get through the final details ahead of an expected announcement will be made in January. Mercosur’s members hoped to close the agreement last week, but the Europeans asked for time to evaluate some aspects of the South American offer.


Carrefour denied reports this week in a French publication that said the country planning to sell-off its business in Argentina as part of a bid to turnaround the companies fortunes. The reaction, prompted by a report in Capital magazine which said the French firm was planning a sell-off of its operations in Argentina, China and Poland, comes months after the firm issued a profit warning.



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