Small and medium-sized enterprises (SMEs) in Argentina experienced a 9.9% decline in manufacturing production in February compared to the same month last year, according to a report from the Argentine Confederation of Medium Enterprises (CAME). This marks the third consecutive month of decline in manufacturing activity, although the rate of decline has decreased from previous months.
The uncertainty among SMEs stems from the government’s decision to open up imports, with concerns about cost increases in services and fuels. The SME Industrial Production Index (IPIP) prepared by CAME surveyed 413 SME industries at the federal level, revealing that companies operated with 70.9% of their installed capacity in February. While some industries continue to face difficulties replenishing stock, the scale of these difficulties has decreased compared to previous months.
Five out of six manufacturing sectors surveyed experienced annual declines, with the most affected sectors being “Paper and Printing” and “Chemicals and Plastics.” However, the “Food and Beverages” sector had a slight decline annually but experienced a rebound in production in February, while the “Clothing and Textile” sector saw growth but recorded a drop in production compared to the previous month. Other sectors such as “Wood and Furniture,” “Metallic, Machinery, Equipment and Transport Material,” and “Chemical and Plastic Products” all experienced declines in production.
Overall, the report reflects ongoing challenges in the manufacturing industry for SMEs in Argentina, with concerns about cost increases, difficulty translating these increases into prices, and uncertainty surrounding the impact of open imports. Industries are operating below full capacity, and while some sectors have seen growth, the overall trend is a decline in manufacturing activity.
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