The SME industry plummeted 26.9% in December and closed 2023 with a fall of 2.6%

The level of activity of small and medium-sized industries registered a significant drop of 26.9% compared to the same month of the previous year and closed the 2023 with an accumulated decrease of 2.6%, according to a report prepared by the Argentine Confederation of Medium Enterprises (CAME).

In the monthly comparison, against last November, industrial activity also suffered a retraction of 31.7%.

SME industry: what were the reasons for the fall

“The significantcurrency depreciationthe escalation of the inflation after the elections and changes in regulations import restrictions, which prevented purchases for a few weeks, among other issues, created an environment marked by high uncertainty and decreased consumptionfactors that hindered production levels in the manufacturing sector as a whole,” CAME said when explaining the numbers for the last month of 2023.

“In addition, they experienced periods without contributionswith high rates of shortage of inputs, which led numerous companies to suspend operations for a few days or advance their staff’s vacations,” added the business entity.

CAMEin a statement, noted that although industrial SMEs operated with el 73.1% of its installed capacity, almost at the same levels as November (73.3%), the contrast with the production level was due to “the exit from the production process of some machinery without spare parts available, and the shrinking of business units in the face of the expectation of a future recessive”.

In this framework, in December and53.4% ​​of companies reported difficulties in replenishing stocks, especially in obtaining raw materials and inputs.

These results arise from the SME Industrial Production Index (IPIP) prepared by CAME, with a sample that reached 410 SME industries at the federal level.

SME industry: how was the decline by sector?

By sectors, in December the worst performance corresponded to the category “Metallic, machinery, equipment and transport material”, with an annual drop of 35.7% in its production, at constant prices, followed by “Wood and furniture” (-34.4%).

Meanwhile, in the accumulated year, the best sector performance was in “Textile and Clothing”with an increase of 3.3% compared to the January-December 2022 period.

While the worst performance in the accumulated annual period was for the category “Paper and prints”, with a drop of 16.7%.

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Industrial SMEs operated with 73.1% of their installed capacity