Argentina Shipping Report Q1 2016
BMI View: Our outlook for the Argentinian port sector is continuing to look better than it has been forsome time. In 2016, we forecast growth, albeit modestly, both in tonnage and throughput volumes at severalof the country's maritime facilities. Weaker private consumption will continue to reduce imports in the nextyear, while a weaker exchange rate will slightly improve the competitiveness of exports, which will have apositive outcome for port volumes. Government intervention, industrial unrest and bureaucraticrequirements will continue to disrupt the industry, while easing inflationary pressure supporting growth inhousehold incomes, declining real imports and a boost in soy export volumes will strengthen net exportnumbers. However, we sill forecast a moderate expansion due to structural issues still affecting thecountry.
Following years of successive contractions in tonnage and throughput volumes at several of the country'smaritime facilities, we forecast an increase at all ports in 2016, with the Port of Buenos Aires increasing itsnumbers all the way until the end of the forecast period. This comes as growth rates in trade will improveover the next five years, with the trade balance increasing each year until the end of our forecast period in2020 at USD27bn. A more moderate inflation will continue to drive positive GDP growth in Argentina overthe medium term, and we forecast GDP growth to increase from 2.5% in 2016 to 5.5% by the end of ourforecast period (average growth rate of 3.7% y-o-y). The accelerated growth will be due to fixed capitalformation returning to growth on the back of investor optimism toward a new government.
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