Argentina Competitiveness

September 11th, 2013

Manufacturers in Argentina are concerned by the fall of the competitiveness of the real exchange rate, and it is not for less. With a quasi fixed dollar, at $3.10 and with a real inflation exceeding 20% inter-annual type of real change in argentina’s economy comes deteriorating at a strong pace. Such is the deterioration of the kind of real change that, as it reflects a Sebastian Campanario article to the site Ieco, the relationship between the value of the Argentine peso and the dollar would be one for 2009 in real terms. Until a few weeks ago ago, from the field not had heard many complaints in this respect. It is that with the high international prices of agricultural commodities, the field could keep their profitability despite withholding imposed by the national Government. But with the sharp fall in the international price of the price of agricultural commodities, next to retentions and the rising value of agricultural inputs (which is compounded by the severe drought that suffers in several regions of the) country), the current situation is totally different and this is why that was already ahead of the field will claim to agricultural Secretary Carlos Cheppi, a dollar from $3.50 to $3.80, which would imply an average jump close to 20% of its current value which is currently in the $3.12. The claim of the field isn’t very far away from that industrialists formulated (although more timidly). Thus, two sectors of weight in the Argentine economy, come together virtually on the order of a more competitive exchange rate. Probably since the Government noted how the external accounts are deteriorating without pause and perhaps up to recognize the need to do something to improve the competitiveness of the Argentine economy, but will the Government to devalue the Argentine peso in the search by restoring part of the lost competitiveness of the export sector ready? In his time, when the crisis erupted nominal exchange rate went from relationship one with the dollar at a ratio of $3.5 per dollar (and he even came to be hovering around $4 per dollar).

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