Argentina Country Risk Report

Providing comprehensive data and in-depth analysis of political, financial and economic risk.

Report includes: BMI's Core Views, 10-year Forecasts, BMI's Economic Risk Index, Political Stability and Risk Index, Long-term Political Outlook, Operational Risk Index, SWOT Analysis and Structural Economic Sections

Why you should buy this report

  • Understand and measure the political, business environment and operational risks to your company
  • Gain insight on emerging trends that could support, strengthen or disrupt your activities in the market
  • Benefit from 10-year macroeconomic forecasts and insight into the structural characteristics of the economy
  • Get the long-term political outlook and explore possible scenarios for change
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Argentina Country Risk Report
Product Price
$1,195.00

Core Views

  • A substantial uptick in investment is likely following a devaluation and liberalisation of Argentina's external accounts. Nonetheless, this will likely not begin until the latter half of 2016, leading to a contraction in real GDP as private consumption declines with real purchasing power. This will ensure the Argentine economy contracts this year. Thereafter, Argentina will enter a period of robust growth as foreign investment flows into the country.

  • The government of president-elect Mauricio Macri will move to substantially reduce the country's budget deficit in the coming years by reducing government subsidies on electricity. This will serve to temper inflationary pressures as the government can move away from printing new pesos to finance its substantial deficit. Nonetheless, subsidy reduction will be gradual to limit the shock to consumers' disposable incomes.

Key Risks

  • The largest risk to the Argentine economy stem from potential pushback from the Frente para la Victoria in Argentina's legislature. The party maintains a majority of seats in the country's senate, and could block many of Macri's proposed reforms.

  • Weak economic growth in key trade partners such as Brazil could weigh on Argentine export growth more than our forecasts currently anticipate. Moreover, soy revenues could disappoint on the back of unfavourable weather across the Americas region, dampening agricultural exports and hurting the current account balance. In addition, should the Argentine government revert back to anti-business policies, financial account outflows would likely put additional downward pressure on foreign reserves.

Macroeconomic Forecasts (Argentina 2014-2017)
Indicator 2014 2015e 2016f 2017f
f=BMI forecast; Source: INDEC, BCRA, BMI
Real GDP growth, % y-o-y 0.5 0.7 -1.2 3.2
Nominal GDP, USDbn 599.3 611.1 451.8 565.7
Consumer price inflation, % y-o-y, eop 12.7 18.0 15.0 7.5
Exchange rate ARS/USD, eop 8.47 12.93 14.25 14.75
Budget balance, % of GDP -2.3 -7.2 -5.5 -3.6
Current account balance, % of GDP -0.8 -1.8 0.8 0.4
Executive Summary
5
Core Views
5
Key Risks
5
Chapter 1: Economic Outlook
7
SWOT Analysis
7
BMI Economic Risk Index
7
Economic Growth Outlook
8
Sharp Adjustments Point To Rising Investment In H216
8
GDP By Expenditure Outlook
9
TABLE: 10-YEAR GDP FORECASTS
9
TABLE: PRIVATE CONSUMPTION FORECASTS
9
TABLE: GOVERNMENT CONSUMPTION FORECASTS
9
Fiscal Policy And Public Debt Outlook
10
Deficit Set To Narrow On Subsidy Reduction
10
TABLE: GROSS FIXED CAPITAL FORMATION FORECASTS
10
TABLE: NET EXPORT FORECASTS
10
Structural Fiscal Position
11
External Trade And Investment Outlook
12
Reform Will Drive Improving External Accounts
12
Outlook On External Position
14
TABLE: CAPITAL AND FINANCIAL ACCOUNT BALANCE
14
TABLE: TOP FIVE GOODS IMPORTS IN 2014
14
TABLE: TOP FIVE GOODS EXPORTS IN 2014
15
Monetary Policy
16
Central Bank Independence Will Bolster Inflation-Fighting Credentials
16
Currency Forecast
17
ARS: Market Sentiment Will Drive Near-Term Depreciation
17
TABLE: BMI CURRENCY FORECAST
17
Regional Economic Outlook
18
Little Respite For Sovereign Risk In 2016
18
TABLE: KEY MACROECONOMIC INDICATORS - 2016 FORECASTS & TREND COMPARED WITH 2014
19
Chapter 2: 10-Year Forecast
23
The Argentine Economy To 2025
23
Long-Term Growth Driven By Reform Agenda
23
TABLE: LONG-TERM MACROECONOMIC FORECASTS
23
Chapter 3: Political Outlook
27
SWOT Analysis
27
BMI Political Risk Index
27
Domestic Politics
28
Improving Legislative Dynamics Will Support Reform
28
TABLE: POLITICAL OVERVIEW
28
Long-Term Political Outlook
30
Post-2015 Election, Discourse Moves To The Centre
30
Chapter 4: Operational Risk
33
SWOT Analysis
33
Operational Risk Index
33
Operational Risk
34
TABLE: OPERATIONAL RISK
34
Trade Procedures And
Trade Procedures And
Governance
35
TABLE: ARGENTINA EXPORT AND IMPORT DOCUMENTS
35
TABLE: ARGENTINA TRADE PROCEDURES BREAKDOWN
35
TABLE: LATIN AMERICA - TRADE PROCEDURES AND GOVERNANCE RISK
36
Vulnerability To Crime
37
Chapter 5:BMI Global Macro Outlook
41
Global Macro Outlook
41
Tail Risks Mounting Amid Sub-Par Growth
41
TABLE: GLOBAL ASSUMPTIONS
41
TABLE: DEVELOPED STATES, REAL GDP GROWTH, %
42
TABLE: BMI VERSUS BLOOMBERG CONSENSUS REAL GDP GROWTH FORECASTS, 2015 AND 2016 (%)
42
TABLE: EMERGING MARKETS, REAL GDP GROWTH, %
43
TABLE: MACROECONOMIC DATA & FORECASTS
45

Assess your risk exposure in Argentina with our 100% independent forecasts assessing the pace and stability of this key market. Backed by trusted data from BMI Research's 52 million data point economic forecast model, this report will allow you to measure political, economic, business environment and operational risks in Argentina with confidence.

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  • Delivery of the report in print and PDF
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