MercoPress. South Atlantic News Agency

Farmers' conflict begins to impact growth indexes

The Argentine economy expanded at an annual 7.9% in April closing the first four months of 2008 with at an annual growth rate of 7.5%. This would be the sixth year running that the Argentine economy has been expanding vigorously after five years averaging 8.5%.

Argentina's economy soared following the prolonged 1999/2002 recession that plunged over half the population below the poverty line with unemployment percentages in the high twenties. "The April economic recovery originated in the resumption of farm activity following the three weeks long stoppage of March", said economic advisors Orlando Ferreres and Associates. "This helped activities linked to camp such as commerce, manufacturing and transport", added the economic advisor. Following March's stoppage, farmers agreed a month long truce with the government during April and are currently back again protesting because no agreement on grain and oil seed export levies has been reached. In the first two months of 2008 the Argentine economy was growing at an annualized rate of 9.4% "In the first four months services expanded 8% and goods slightly less, 6.1%. The slowdown can be attributed to the farmers' conflict", said Ferreres. In the first four months of the year the financial sector showed the best performance with a 28.5% advance, followed by construction, 8.9% and transport and communications, 8.4%. "Consumer loans, credit cards keep expanding at a good rhythm while long term credit, (mortgages) remain stalled", said the report from the consultants. Mining and quarries was the only sector with negative growth in the first four months of the year, 0.4%. Agriculture expanded 4.8% in April following a 6% contraction in March, averaging 3.1% in the first four months to April.