May 24, 2019
1. Electoral scenario changes with Cristina Fernández de Kirchner’s candidacy announcement
Weeks away from the final day parties can announce electoral coalitions, presidential elections are slowly taking shape. Former President Cristina Fernández de Kirchner announced via Twitter that she will run as the vice-presidential ticket for her former Chief of Staff Alberto Fernández. On the other hand, the incumbent coalition led by President Mauricio Macri has yet to define its presidential ticket and is awaiting a decision from key ally, the Unión Cívica Radical (UCR), regarding its participation in the coalition in light of its upcoming party convention on Monday. Macri hopes to avoid a primary and ensure his allies have a greater presence on the ballot. Following Kirchner’s announcement, the Peronist faction Alternativa Federal reiterated that it will opt for a third option outside of Kirchnerism and Macri’s coalition. For this reason, Macri met with Córdoba Governor Juan Schiaretti to discuss his proposal to provide a semblance of continuity in the executive branch regardless of the outcome of October’s elections. Finally, former Economy Minister Roberto Lavagna also confirmed his presidential aspirations, but his participation within Alternativa Federal is still up in the air.
2. OECD projects lower inflation and 2.1% GDP growth for 2020
Jens Arnold, the head of the Argentina-Brazil section of the OECD’s economic department stated on Tuesday that, “although inflation is high, it will decrease in the coming months as a result of monetary and fiscal contractions and better predictability in the exchange rate.” Arnold considers that growth will begin to show itself this year, given that “it is projected exports will spur [economic] recuperation with quarterly growth rates that will return to positive numbers in 2019.” Finally, the multilateral body projects that unemployment will not decrease before 2020, and that this year will register a primary fiscal deficit of 1%. In the same vein, Secretary General of the OAS Luis Almagro backed Macri’s administration, especially its rejection of Venezuelan leader Nicolás Maduro’s handling of his country’s political, social and humanitarian crisis.
3. Economic activity falls 6.8% in March
Argentina’s national statistical agency announced that its economic activity indicator fell 6.6% in March. On the same token, economic activity fell 1.3% compared to February and registered a5.7% drop in Q1 2019. On the other hand, due to the fall in imports, there was a trade surplus of US $ 1131 million. The data of the INDEC is that corresponding to April and is compared with a deficit for the same month of 2018. Exports increased by 1.7%, while imports decreased by 31.6%. The items that fell the most were capital goods (42.3%) and automotive goods (69.7%)
4. Congress passes law that promotes the knowledge economy
The measure hopes to create 215,000 quality jobs and generate USD $15 billion in annual exports by 2030. Its objective consists of radically increasing productivity and prompting the creation of quality employment in the sector across the economy. The new policy aims to seeks to impose a tax regime that allows 11,000 companies to compete globally and doubling employment in the sector within 10 years. The proposal came as a result of meetings between business leaders, technicians and legislators and counted with the support of entrepreneurs and leaders in the sector. The knowledge economy includes industries like software, biotechnology, the satellite and aerospace sectors, geological and prospecting services, audiovisual activities, nearly everything related to electronics and communications, outsourced service centers, research and development, nanotechnology, nanoscience and the development of 4.0 consumer goods.
5. Great Britain opens a USD $1.27 billion line of credit for investment into Argentina
The export financing agency of the United Kingdom (UKEF), opened a line of credit worth USD $1.27 billion for investment into Argentina. The agreement was revealed in the framework of the third public-private mission to the United Kingdom organized by the Argentine-British Chamber of Commerce (CCAB) and the Argentine Chancellery. Legislators, business leaders, functionaries and bankers met to discuss investment projects, especially in the mining and energy sectors. In the same meeting, the Argentine government presented 100 national and provincial infrastructure projects. Mark Menzies, in charge of investments and trade with Argentina, highlighted the “phenomenal opportunities” available in the country.