By By Ken Parks for Wsj.comArgentina's trade surplus fell 22% on the year in June even as policy makers adopt increasingly aggressive measures to stem a torrent of imports.
Argentina ran a trade surplus of $1.02 billion last month, down from a revised $1.31 billion in June 2010, the national statistics agency, Indec, said Friday.
During the first half of the year, the surplus fell 21% to $5.79 billion. The surplus for the 12-month period ended June 30 was $10.1 billion.
The central bank's latest forecast is for the surplus to shrink to $9 billion this year, from $12.06 billion in 2010.
Argentina's booming economy is driving demand for a wide range of imported capital goods, spare parts, and consumer products.
At the same time, energy imports have soared as government price caps and export taxes discourage investment in oil and natural gas exploration even though Argentina is thought to hold vast reserves of unconventional natural gas.
"Despite the solid performance of exports year to date, the trade surplus has been gradually eroding given the buoyancy of imports. We expect the trade balance surplus to decline to US$7.8 billion in 2011," Goldman Sachs economist Alberto Ramos said in a note.
President Cristina Kirchner has stepped up measures aimed at reducing or substituting imports in order to protect the shrinking trade surplus, which is a key source of international reserves.
Importers are under pressure to..Read full article
