Argentina hit by severe drought last year, hurting crops

Argentina's battered economy contracted 1.6% in 2023, and financial services, manufacturing, wholesale and retail were among the sectors that were hit the hardest. The economy contracted in December by the most since the peak of the Covid-19 pandemic as newly elected President Javier Milei put in motion shock austerity measures Argentina was hit by a severe drought in 2023 that hurt its agro-export industry and subtracted 3.0 percentage points from GDP, according to official data. Last month, the International Monetary Fund -- to which Argentina owes $44 billion -- revised its forecast downward with a contraction of 2.8 percent in 2024. Ultra-liberal new President Javier Milei was elected on promises to slash state spending. Since coming to office in December, he has devalued the peso by over 50 percent, cut tens of thousands of public jobs and halved the size of the government. Annual inflation has hit 254 percent.