MercoPress. South Atlantic News Agency

Energy shortages impact on Argentine industrial activities

For the first time since Argentina begun its strong recovery in 2003, industrial production contracted apparently because of the escalating energy problems and restrictions, according to the Buenos Aires think-tank FIEL which regularly releases monthly reports on economic and other activities.

FIEL numbers show that manufacturing industry last June in Argentina contracted 0.8% compared to a year ago and 3.9% down from last May. The last time an industrial activity contraction occurred in the inter-annual index was in November 2002. "The decrease in industrial activity perceived by Fiel indexes during June is most likely associated to problems emerging from insufficient provision of gas and electricity for the manufacturing sector during the last days of May and with greater intensity in June", said the release from the think-tank. Among the areas most affected by the energy shortages were basic chemical products, petrochemicals, plastics, agro-chemicals, steel plus paper and pulp. "If this finally proves correct when the official numbers are released later this week, it would be the first time in 22 months running at maximum level that the streak is interrupted". Meantime in Buenos Aires Government palace, Casa Rosada, President Nestor Kirchner advanced that economic activity in Argentina during May expanded 8.5% compared to a year ago and 1.4% over last April. President Kirchner made the announcement two days after the ousting of Economy minister Felisa Miceli involved in the "toiletgate" (unaccounted 64.000 US dollars in cash discovered in her ministerial toilet), and a day before the official launching of Mrs Cristina Kirchner's candidacy to next October's presidential election.