Argentina's GDP increased by 10.3% in 2021, the highest growth recorded in the country since 2004

Argentina achieved growth in its economy in 2021, with GDP rising 10.3%, overcoming for the first time the recession cycle that began in 2018 and worsened with the COVID-19 pandemic, with GDP declining 9.9% in 2020, according to data from the Institute of Statistics (Indec).

Despite last year's growth, the Latin American country still has moderate expectations of recovery, as it has significant challenges to face in resolving differences at home.

The Monthly Estimator of Economic Activity (EMAE) registered in December 2021, a growth of 9.9% year-on-year and an increase of 0.9% compared to November. Moreover, compared to the data for the same period in 2019, a growth of 7.1% has been experienced.

Argentina's GDP accumulates ten consecutive months of growth over 2020. Its annual increase of 10.3% is the highest value recorded in the country since 2004, and manages to recover from the slumps of 9.9% in 2020, 2.5% in 2018 and 2.1% in 2019.

Statistics show signs of recovery in the Argentine economy. The EMAE reflected in December 2021, that 13 of the 15 sectors measured showed positive results, with the hotel and hospitality sector standing out in particular with an increase of 43.5%, and transport and communications (+16.9%). Fishing is the only sector that has suffered a drop compared to the previous year (-4.7%), according to the Indec report.

In the renegotiation of Argentina's debt with the IMF, the economic growth of this past year is one of the pillars on which the request of Alberto Fernández's government to refinance the debt of close to 44 billion dollars with the IMF is based.

Economic projections for the coming years are expected to be more moderate, with growth of between 3.5 and 4.5 % by 2022, and between 1.7 and 2.2 % annually by 2023, according to estimates by the Ministry of Economy in collaboration with the IMF.

The refinancing agreement with the IMF may be close, and the Argentine economy minister, Martín Guzmán, plans to receive an initial disbursement of at least 7.5 billion dollars, with the aim of recovering payments, cancelling debts and increasing the reserves of Argentina's central bank. With this solution, known as the injection of Special Drawing Rights (SDRs), Martín Guzmán assures that they will be able to "calm the Argentine economy".

Americas Coordinator: José Antonio Sierra