After four years of trade surplus, the effect of the drought has meant that 2023 will close with a deficit of 6,926 million dollars, the worst result since 2017.
According to INDEC, there was a 24.5% drop in exports over the year, forcing them to close 66,788 million dollars. The worsening occurred both in quantities (-16.4%) and in prices (-9.7%).
If the deficit was not greater it was because, the lack of foreign currency and the economic contraction, There was also a slowdown in imports, concentrated in the second half of the year. Purchases abroad achieved 73.4 billion dollars9.6% less than in 2022. The annual decline is explained by a joint effect of prices (-5.8%) and quantities (-4.1%).
In December and after nine months the trade balance returned to positive, with 1,017 million dollars in the month. Added exports 5,273 million dollarsa decline of 13.8%, and imports have reached 4,255 million dollarsa decline of 15.2%.
The consultancy firm ACM indicates that drought is behind the large deficit in 2023, which has reduced exports of Primary Products (PP) and Manufactures of Agricultural Origin (MOA), reducing by 9.35 billion dollars in the first case e 9,214 million dollars in the second concerning 2022.
“On the other hand, the policy of containing the dollar to function as an inflationary anchor, It delayed the exchange rate and generated greater expectations of devaluation, which ended up distorting incentives for both exports and imports.“, ACM trademark.
After the collapse of 2023, the outlook for this year is encouraging. LCG’s projection is that, without the drought, “we would return to export levels like those of previous years, approximately 83 billion dollarswhich implies a 24% jump compared to 2023.”
“On the import side, the elimination of the SIRA proposed by the new government would free up imports by 2024, although the devaluation of the exchange rate makes the monetary possibilities of doing so difficult, which we expect to amount to 68,000 million dollars, 7% less than this year, also as a result of the recessionary situation.”
“Although deferred payments will continue (due to the new BCRA measures), the stock of commercial debt would start to be regulated through different mechanisms such as debt relief bonds,” indicates LCG, despite the fact that BOPREAL has shown a dubious acceptance by importers.
For LCG, the year ahead could bring 15 billion dollars through the trade balance.
Abeceb has a similar projection. “By 2024, a notable improvement in the external balance is expected, which would include a significant increase in exports, which would recover thanks to the reversal of the effect of the drought, the expected improvement in the energy balance of mineral exports”.
“The correction of the real exchange rate (which encourages exports and discourages imports) and the recession will also fuel the improvement in the trade balance which could reach a positive balance close to 15 billion dollars“, they underlined.
Source: Clarin
