Argentina’s economic recession deepened in the second quarter of 2024, with a 1.7% contraction compared to the previous quarter, marking the third consecutive quarterly decline. The downturn is linked to President Javier Milei’s strict austerity measures and the significant currency devaluation introduced since he took office in December.
While Argentina’s agriculture sector grew by 81.2% year-on-year, benefiting from the harvest season, key industries such as construction and manufacturing plummeted, with 22.2% and 17.4% declines respectively. Consumer spending, private investment, and government expenditure also shrank, further compounding the country’s economic challenges.
Milei’s policies, aimed at curbing inflation—currently over 250%—and reducing fiscal deficits, have hit various sectors hard. The austerity program, though deemed necessary to stabilize the economy, has driven poverty rates higher, with half of Argentina’s 46 million citizens now living below the poverty line.
Despite the grim figures, Milei remains committed to his economic reforms, projecting a 3.8% GDP decline for 2024 but expecting 5% growth by 2025. However, analysts remain cautious, predicting more modest growth rates and highlighting the challenges facing South America’s second-largest economy as it struggles to emerge from recession.
