Latin American Trade Roundup September
As specialist logistics service providers to and from the region, Envío has summarised a few recent items of Latin American trade news from this month below.
Argentina – Presidential Candidate Issues New Policies
Argentina’s Economy Minister and presidential candidate – Sergio Massa – has been busy this month introducing new policies ahead of October’s elections. Massa recently announced a VAT refund for 9 million workers on basic food items in a move to discourage unregistered transactions, he is also willing to raffle cars and household appliances for retailers and customers to increase purchasing power of registered workers.
This follows a previous announcement this month to lift export taxes on international sales of regional economy products with added value. The measure favours the agro-industrial sector with over 1,200,000 registered workers.
Meanwhile, Argentina’s inflation reached 124.4% last month. The highest monthly rate in over 32 years followed August’s devaluation of the Argentine peso.
Brazil – Interest Rates Lowered Again
Brazil’s central bank lowered their interest rate to 12.75% last week, dropping for the second month in a row. Prior to the cuts, Brazil’s government had been pressuring banks to make cuts for months after the rate reached 13.75% last year – the highest since 2017 and a significant rise from the record low of 2% in 2021.
The country’s consumer inflation came in at 4.61% last month and is expected to average 5% in 2023 and then 3.5% next year according to the bank’s monetary policy committee.
Uruguay – Economy Shrinks
The Central Bank of Uruguay revealed a 2.5% year-on-year decline in the country’s GDP, believed to be due to adverse effects of the recent drought in the country. This downturn was particularly evident in key sectors, including a staggering 27.4% drop in agricultural activity, an 11.8% decrease in electric, gas, and water, and a 6.6% decline in construction.