Argentina Posts First Trade Deficit in 16 Years

Argentina reported its first annual trade deficit in 16 years after the new government revised data produced by the previous administration.

The shortfall was $3 billion in 2015, the statistics agency’s Technical Director Fernando Cerro said Thursday at a news conference in Buenos Aires. Before the government assumed power in December, the agency known as INDEC, had reported a surplus in each of the first 10 months of the year. The trade surplus for 2014 was revised down to $3.1 billion from $6.7 billion, Bloomberg reported.

President Mauricio Macri’s government in December announced a statistical emergency and suspended the publication of all official data while it overhauls the INDEC. Argentina in 2013 became the first nation to be censured by the International Monetary Fund for misreporting its statistics.

“For 2015, we’re reporting a deficit of more than $3 billion,” Cerro said. “When we arrived, the statistics showed a tendency toward a surplus.”

Exports fell 17% in 2015 to $56.8 billion as a result of a 16% decline in prices and a 1% fall in volume. Imports slid 8% to $59.8 billion, mainly due to the drop in energy prices.

The last time Argentina posted a trade deficit was during the economic crisis that culminated in a $95 billion default on its debt in 2001. In 1999, South America’s second-largest economy had a trade deficit of $2.2 billion.

Meanwhile, the International Monetary Fund said Thursday that Argentina’s economy will grow about 3% annually over the next five years, after formally reviewing the country for the first time in a decade.

Argentina severed ties with the IMF in 2006, accusing it of meddling in domestic affairs and trying to dictate economic policy. Nestor Kirchner, then Argentina’s populist president, settled a nearly $10 billion debt with the IMF that year and then refused to cooperate with it.

The standoff continued until last December, when Argentina’s new business-friendly president, Mauricio Macri, overturned an unusual mix of unorthodox economic policies that fueled double-digit inflation and led to Argentina’s international financial isolation.

“Important progress has been made already in 2016,” the IMF said in a statement, lauding Macri’s market-oriented economic policies.