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ECONOMY | 30-06-2020 12:33

Argentina's economy tanked in April as virus hit home

Construction was the worst hit industry, plummeting 86.4%, with hotels and restaurants not far behind (down 85.6%). Manufacturing, down 34.4%, and business, which lost 27%, were also hard hit.

Argentina's economy shrank by more than 26 percent year on year in April while also contracting by 17.5 percent compared to March, the INDEC national statistics bureau said on Monday.

Over the first four months of the year, the economy fell 11 percent compared to 2019, data indicated.

"The Covid-19 pandemic had a total impact on activity in April with all sectors falling," said INDEC in a statement.

Construction was the worst hit industry, plummeting 86.4 percent, with hotels and restaurants not far behind (down 85.6 percent). Manufacturing, down 34.4 percent, and business, which lost 27 percent, were also hard hit.

The news comes with Argentina already reeling from two years of recession.

The country went into lockdown on March 20 to help prevent the spread of the novel coronavirus, but those measures have been gradually eased in recent weeks.

However, following a spike in coronavirus cases in the capital, a new lockdown has been imposed on the Buenos Aires metropolitan area – home to more than a third of the country's 44 million people – from July 1 to17. 

Argentina has recorded almost 60,000 cases, with more than 90 percent of those in the greater Buenos Aires area, and 1,245 deaths from the virus. 

As well as trying to manage the coronavirus crisis, President Alberto Fernández is also attempting to renegotiate a US$66-billion debt with stubborn creditors.

A month ago, Argentina – one of the world leaders in food exports – defaulted for the ninth time after failing to pay US$500 million of interest on its bond debt.

With 35 percent of the country's people already living in poverty, Fernandez is unwilling to budge much in his negotiations.

The International Monetary Fund has predicted the economy will shrink by 9.9 percent this year, after a 2.5 percent fall in 2019.

– TIMES/AFP

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