21 de junio 2007 - 00:00

Argentine economy grows 8.4% in April

Argentine economy has grown 8.4 per cent in April with respect to the same month of 2006 and it has accelerated against the previous quarter, according to the report on Monthly Economic Activity Estimator (EMAE, in its Spanish acronym) to be disclosed today by government.

Argentine President Néstor Kirchner disclosed in advance yesterday morning that April's hike would hover around 8 per cent. "We keep on growing at a fast pace, despite expected slowdown," the State chief stated during a ceremony in Rosario Stock Exchange. For her part, Argentine Economy Minister Felisa Miceli described this information as "shocking."

February and March EMAE have posted an increase of 7.9 per cent and 7.6 per cent. Thus, April's data entail a rise with respect to what has happened during the last months.

During the first quarter, GDP has expanded 8 per cent against 2006's 8.5 per cent, showing that economy is slowing down, though yet far from falling. 2007 outlook forecasts that economy will end up posting a 7.5-per cent increase. However, it may even scrape 8 per cent, if crop continues with this extraordinary rhythm.

Greatest driving force

April's leap is also linked to the fact that the same month of 2006 was weak with respect to economic activity, rising 6.4 per cent.

Services sector was the driving force behind economy, together with crop performance. Reactivation of financial sector, transport, communications, trade and tourism stand out. However, industry loses participation when having to explain growth data.

Within manufacturing area, car companies lead the list comfortably, improving almost 40 per cent with respect to 2006. The remaining areas also rally, though more slowly.

Even some highly-dynamic sectors during the last years now reflect a virtual stagnation, like paper, cardboard or plastic industries.

It's clear that sectors sustaining economic expansion are different from those allowing rebound after 2002 crisis. In this sense, services clearly beat industrial sector, which keeps on growing, though at rates hovering around 6.5 per cent.

Today, May trade result will be disclosed. An average $1.25-billion surplus is estimated, 7.7 per cent below the same period of 2006.

One piece of information causing worry about future economy development is inflation leap. This phenomenon has an impact on some sectors, like construction, which has gone through a sharp cost rise, thus reducing profitability margin.

Also lack of energy generates problems in companies, as proved by weak development of industrial production in May.

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