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Mon Jun 29, 2020, 08:30 PM

Argentine GDP plunges record 26.4% in April amid pandemic and lockdown

Argentina’s economic activity plunged 26.4% in April, the country’s official statistics agency said on Monday - the worst monthly fall on record as the country reeled from the impact of the novel coronavirus pandemic and a nationwide lockdown.

The April drop, after the South American grains producer imposed the lockdown on March 19, was worse than the 21% decline predicted by analysts polled by Reuters, underscoring how badly the pandemic has battered local industry.

Already mired in recession for two years and in default on foreign debts, Argentina is headed for an annual economic contraction in 2020 that the IMF has estimated at about 10%.

The worst-hit sectors included construction and tourism, which fell over 85%. Manufacturing fell 34.4%, and finance fared best with a 3.2% decline thanks in part to credit subsidies.

Subsidies and relaxed restrictions resulted in a 9.2% rebound in May, according to economist Orlando Ferreres - but GDP remains 14.9% below May 2019 levels. An economic relief package of nearly $20 billion (5% of GDP) has been earmarked since March.

Argentina’s government faces a tough balancing act between combating a recent spike in COVID-19 cases and reopening the economy.

President Alberto Fernández reimposed a quarantine in and around Buenos Aires on June 26 - but relaxed rules in other parts of the country. Some 90% of the nation's Covid cases reported thus far, have been in the Buenos Aires metro area (home to one third of Argentines).

The country has reported 62,268 cases, and 1,280 deaths. Its death rate of 28 per million people compares favorably with 275 in Brazil, 288 in Peru, 292 in Chile, and 389 in the U.S.

At: https://www.reuters.com/article/us-argentina-activity/argentina-economic-activity-plunges-record-26-4-in-april-amid-pandemic-idUSKBN2402PX

A quiet weekday recently in Buenos Aires' normally bustling Corrientes Avenue.

A federal stay-home order issued on March 19 has helped curve the ongoing Covid-19 pandemic in Argentina - which has seen Covid deaths rates of one tenth that of most of its neighbors.

The restrictions, however, have led a sharp deepening of the country's two-year "Macrisis" - its worst debt and economic crisis in two decades.

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