MercoPress. South Atlantic News Agency

Argentina’s trade surplus in six months jumps 91.7%; imports down 38%

Mercosur has become Argentina’s main trade partner

Argentina’s trade surplus jumped 91.7%, equivalent to 9.8 billion US dollars in the first half of this year compared to the same period a year ago, according to the latest release from the country’s statistics office, Indec.

Surplus in June this year was 620% higher (1.5 billion US dollars) over June 2008. Exports dropped 5% to 5.16 billion US dollars, while imports fell 30% to 3.6 billion US dollars.

Imports have been falling in Argentina as a consequence of slower global economic activity and the hurdles imposed by the Domestic Commerce Secretary to overseas purchases, according to reports in the Argentine press. Even so June was a “modest” month since imports contracted 49% and 43% last May and April.

In the first half of the year Argentine exports totalled 27.25 billion US dollars, down 19% from a year ago. Imports reached 17.39 billion, which is 38% less. A majority of exports, 22%, were absorbed by Mercosur; European Union, 18% while Asia, China, Japan and India, 17%. Mercosur was also the main source of imports, 34%; Asia, China, Japan and India, 21%; European Union 17% and NAFTA (US, Canada and Mexico) 17%.

Argentina desperately needs significant trade surpluses because she is barred from international money markets given pending agreements with bond hold outs who did not accept the restructuring of the country’s debt following the 2002 default. Argentina this year needs over 20 billion US dollars to honour capital and interest payments.

Besides, although Argentina had access to some soft loans from the World Bank and the Inter American Development bank, the Kirchner administrations refuse any auditing from the IMF which limits access to other financial sources.