MercoPress. South Atlantic News Agency

OECD expects Argentina to grow more than other G20 nations

Argentina’s outlook remains robust, the OECD said

According to the biannual Organization for Economic Co-operation and Development's (OECD) 2025 Economic Outlook published Tuesday, Argentina is projected to experience significant economic growth of 5.2% in 2025 and 4.3% in 2026, the highest among Latin American G20 countries and second only to India globally.

This follows a -1.7% recession in 2024 and reflects improved projections from late 2024 (3.6% for 2025). The growth is attributed to President Javier Milei’s measures, including public sector layoffs and state institution closures, supported by a new International Monetary Fund (IMF) agreement and a US$ 20 billion loan. The recent lifting of exchange rate restrictions is expected to boost economic confidence and investment.

However, Argentina will still have the highest inflation rate among G20 nations, though it is projected to drop significantly from 219.9% in 2024 to 36.6% in 2025 and 14.9% in 2026. The OECD revised its earlier 2025 inflation estimate upward from 28.4% due to slower-than-expected price stabilization.

Growth will be driven by recovering private consumption, investment, and improved financial conditions, but exports are expected to slow (from 23.2% in 2024 to 11.2% in 2025) due to currency appreciation and potential US tariff impacts. Imports are projected to rise sharply by 23.9% in 2025, supported by reduced trade barriers.

The OECD recommends sustained fiscal consolidation, broader tax bases, reduced subsidies, and regulatory reforms to improve fiscal performance and productivity. Despite global growth slowing to 2.9% in 2025, Argentina’s outlook remains robust, though monetary policy must stay restrictive to control inflation.

Brazil was forecasted to grow 2.1% in 2025 and 1.6% in 2026, while Mexico would post 0.4% and 1.1% improvements, respectively. The United States will grow 1.6% in 2025 and 1.5% in 2026.