World Economy

Argentine Grew 2.8% in 2017

File picture of truckers in Buenos Aires during a demonstration last summer against the policies of Mauricio Macri.File picture of truckers in Buenos Aires during a demonstration last summer against the policies of Mauricio Macri.

The Argentine economy grew “close to 2.8%” last year, Guido Sandleris, head of the advisory body to the treasury ministry, told a gathering of Japanese business leaders on Monday.

The data, according to Sandleris, shows a clear recovery of the third-largest economy in Latin America after a contraction of gross domestic product of 2.2% in 2016, Reuters reported.

 “Last year the Argentine economy grew close to 2.8% and we project higher growth this year, close to 3.5%,” said Sandleris in Buenos Aires.

If the data is confirmed, the government of President Mauricio Macri will be exempt from paying a coupon for a bond tied to the level of expansion of the economy, which demanded a minimum floor of growth of more than 3%.

The government’s Indec statistics office will announce the 2017 activity level report on March 21.

Meanwhile, one of the biggest threats to Macri’s pro-market reforms will flare up this week when Hugo Moyano, the leader of Argentina’s truckers’ union, attempts to bring the country to a standstill.

A strike called for Wednesday by the veteran union boss is in protest against Macri’s plan to free up Argentina’s economy, where trade unions wield enormous power. Labor reforms aimed at lowering business costs and boosting productivity are due to be debated in Congress in March, and Moyano wants to obstruct the reform agenda before campaigning for the 2019 presidential elections begins.

“People are convinced that this government is failing, and that it has no answers,” Moyano said last week, after it became apparent Macri was willing to tackle Argentina’s most influential union leader head on—unlike any other president before him.

Thousands of truckers are expected to go on strike for at least 24 hours. In a country as vast as Argentina, with a limited train network, truckers are a critical part of the economy and could leave cash machines, petrol stations and supermarket shelves empty.

“We can’t allow this neoliberal government to take away all our rights just for the benefit of the rich,” says Federico Suarez, a builder who supports the strike and describes Macri as “scum”.

As well as whipping up social unrest, unions could undermine the government’s crucial battle to tame doggedly high inflation. With this year’s round of wage negotiations about to get under way, unions are campaigning for increases of more than 20%.

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