Thursday , July 29 2021

The region is Argentina's most indebted country

The The Economic Commission for Latin America and the Caribbean (ECLAC) issued a document in which various economic points were analyzed. In connection with the. T Argentinathis subject has highlighted several negative markers, such as an increase in the deficit, t enlargement. t informal work and each of actual salary. However, it is on the level indebtedness where they paid more attention as it is at the forefront of the American nations.

In a document entitled "Preliminary Examination of Latin American and Caribbean economies", ECLAC points out that Argentina is the country that has been the most responsible in the last three years in the region and the highest in the last three years, . In addition, the national situation is underlined in order to explain this situation.

"The strong financing of the fiscal plan by debt issuance, together with the exchange rate in constant depreciation, investors doubted the ability of Argentina to cope with the coming maturities of debt, which caused it. The exchange of currencies and the significant transition of capital after the decision of the Federal Reserve United States to raise interest rates, "explains.

In this context, it ensures that "after this negative scenario, the International Monetary Fund (IMF) has approved the original stand-by contract of $ 50,000 million, which was added in September to another $ 7,100 million equivalent in September. 12% of GDP "and adds:" Consequently, gross national debt in the second quarter of 2018 increased significantly, reaching 77.4% of GDP, 20.3 percentage points of GDP compared to the year-end closure of 2017. "

However, in the letter we are talking about "the first payment of the IMF, amounting to US $ 15,000 million, which contributed to a strong depreciation of the pesos, an increase in interest rates and a downward trend in GDP." and warns: "Argentina's public debt is expected to continue to rise, given that the IMF will spend more than $ 13.4 billion over the rest of the year, which will lead to a higher level of indebtedness above 80% of GDP for 2019. funds for $ 22,800 million.

Simply put, Argentina's public debt stood at 53.3% of GDP at the end of 2015, but by the middle of 2018 it reached 77.4%, as it increased by 20 percentage points between 2017. and in the second quarter of 2018. While according to the average deficit, "only two countries Argentina and Bolivia (a multinational state) show a worsening of their equilibrium with respect to GDP, comparing the historical average of the previous decade." Since "indebtedness is essentially public (73.7% of all)"

In the second part of the ECLAC document, the informal nature of work improved slightly compared to the results of 2017, in Argentina and Brazil, there was a "proportionate increase in informality of work" and added: "It should be taken into account: however, the deterioration of the situation on the Argentine labor market which occurred in the second half of the year and does not capture these levels. "In addition, it points to a reduction in the real wages of the formal workforce and the phrase:" Three economies are being contracted (Argentina, Nicaragua and the Bolivarian Republic of Venezuela), while the other economies grow between 1% and 4%. " T

In addition, the letter also refers to inflation, where they emphasize that "Argentina and Brazil are the largest contributor to the increase at regional level, due to the volume of changes recorded in these countries, 22.6 percentage points. in Argentina and 1.9 in Brazil. "It should be noted that with regard to debt, this document does not have the most recent IMF payments.

"If you add the last payout of the Fund, the estimate will reach 97.7%," said Clarn, Guido Lorenzo, LCG consultant, adding: "Debt has a specialty that is 75% in foreign currency", so "this leads to Thinking if we can truly pay. "There are countries that do not have this problem, they issue debts in domestic currency and similar rates to which their product grows, so sustainability is not a problem. "

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