MercoPress. South Atlantic News Agency

Argentina economy shrinks two years running, 2.1% in 2019 after 2.5% in 2018

Argentina has been in recession since mid-2018 as poverty and unemployment are on the rise and inflation surpassed 50% over the last year

Recession-hit Argentina's economy shrank by 2.1% in 2019, the state statistics institute said on Friday. The institute said the economy contracted by 0.3% in December compared to the same period in 2018.

Argentina has been in recession since mid-2018 as poverty and unemployment are on the rise and inflation surpassed 50 percent over the last year. Already in 2018, GDP had dropped by 2.5%.

The news comes at a time when Argentina is attempting to renegotiate almost US$ 200 billion in debt in order to stave off a damaging default.

The International Monetary Fund ended a week-long mission to Argentina on Wednesday, after which it said Argentina's total debt of US$311 billion, worth more than 90% of its GDP, was “unsustainable.”

Center-left President Alberto Fernandez said after taking over from market-friendly Mauricio Macri in December that Argentina would not be able to pay its debts if it did not return to growth.

In December, the hardest-hit sectors were financial services, which shrank almost 10% compared to the previous year, and construction, which was down by eight percent. On the other hand, the fishing industry grew by 13.5%.