MercoPress. South Atlantic News Agency

A billion dollars trade surplus for Argentina in July; Mercosur main partner

Improved prices for commodities and for manufactured goods of farm origin have helped

Argentina’s trade surplus reached 1.014 billion dollars in July, which is 54% higher than the same month a year ago. Exports totalled 7.4 billion and imports 6.37bn according to the latest release from the official stats office, Indec.

Because of the money exchange restrictions imports in July dropped 4% over a year ago while exports were up 1%. In July last year the surplus was 657 million dollars.

Last June the surplus was 1.024bn and 8.35bn in the first seven months of the year. Exports to July totalled 47.03bn and imports, 38.68bn.

Mercosur remains as the main trade partner of Argentina having concentrated in July 22% of sales and 25% of imports. Compared to a year ago exports were down 4% and imports, 19%. In July the trade balance with Mercosur was positive in 43 million dollars.

The increase in exports in July was the result of greater sales of commodities and to a lesser extent manufactured goods of farm origin, According to Indec farm origin manufactured goods represented 34% of exports; industrial goods 32%; commodities, 26% and different fuels, 8%.

As to imports the fall in July is the direct result of lower values for all items with the exception of consumer goods. The main drop was for capital goods accessories and pieces in supply items such as engines, generators, electronic groups and converters, gear boxes, alternative engines, turbine rotors which means and screens for micro computers.

Argentina has set itself a surplus target of at least ten billion dollars this year to compensate for soaring fuel imports last year which it expects to partly compensate with the nationalized oil and gas corporation YPF.

The other powerful and controversial weapon has been directly limiting, delaying or demanding importers to match with exports. These policies have triggered trade and diplomatic clashes of Argentina with the main world trade powers including Brazil, main partner in Mercosur.

Since Argentina still has pending debts and lawsuits from the 2001/02 major default it is forced to have a balanced budget but particularly a trade surplus since it yet has no access to voluntary money markets.