The Mediterranean Foundation (FM) warned that the Argentine export sector will go through "A difficult year to sustain shipments, but clearly more difficult for some productive activities than for others," and stressed that Those who produce agricultural raw materials and food "have not suffered operating bans" since their logistics depend relatively little on air services and their demand is less sensitive to changes in income..
Instead, the entity warned, the Companies that produce high unit value parts and equipment have had to close their plants Due to the containment policy, its logistics depend relatively more on air services and its demand is also suffering more with a drop in income and uncertainty.
The analysis by the Institute for Economic Studies on the Argentine and Latin American Reality (Ieral), of the FM, considered that the country is not alien to the scenario that was generated by the global pandemic caused by the coronavirus.
Regarding the oil sector, the report notes that "although global consumption should not fall as much as that of other goods, the sharp drop in prices is making production (and therefore export) no longer a profitable business in many countries, including Argentina."
The Ieral recalled thatThe World Trade Organization (WTO) estimates that global trade could contract between 12,9% and 31,9% this year, sdepending on how long it takes until the Covid-19 pandemic is controlled.
The evolution will also depend on the inclination of countries to safeguard trade and coordinate actions to reduce the impact on key services, particularly those linked to logistics and transport.
The optimistic scenario proposed by the WTO is a fall in global GDP of around 2,5% and a V-shaped crisis that will not last much more than three months, while the pessimistic scenario suggests a fall in output of 8,8% and a more L-shaped crisis, in which the pandemic cannot be contained quickly and conditions the possibility of a strong economic recovery in 2021.
«In a V-shaped global crisis scenario, where our main partners are beginning to recover in the second half of the year,, Argentine exports could be in a range between US$ 58.000 million and US$ 60.000 million", FM calculated.
The projection took into account various factors (harvest, commodity prices, Brazil, WTO projections, etc.) and was based on last year's export figures (US$ 65.100 billion),
According to the Mediterranean Foundation, This would imply an adjustment of between 8% and 11% compared to 2019."as a result of significant declines in the exported volumes of products such as oil, automobiles and their parts, machinery and equipment in general, and also of international price adjustments, which are very significant for oil and less significant for agricultural raw materials."
"It can be deduced that, if the pandemic spreads or some of the variables with the greatest impact on our global trade (agricultural commodity prices, the economy of Brazil, China, etc.) deteriorate even further, compared to what can be expected of them today, exports would be in a lower range," the analysis concluded.
Source: Telam
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