The utilization of installed capacity in the industry, which measures the used proportion of the productive capacity of the sector, was located in the 57.6% in February, a level lower than the same month of 2023, which was 65%. It is the worst monthly level of usage in more than two years, since the previous lowest record was in January 2022, at 55.6%.
In fact, There was not such a bad percentage for the use of installed capacity in the month of February in at least the last twenty yearsaccording to the records of National Institute of Statistics and Censuses (INDEC). “Is the worst February since the current series is on of the agency, from 2016, is possibly close to the levels of 2002,” he tells Ambit Federico Zirulnik, economist at the Scalabini Ortiz Center for Economic Studies (CESO)
And he assures, however, that “the data is not surprising“This is the result of Javier Milei’s policy and the fall in consumption is the origin of this issue,” diagnoses, for his part, Hernán Letcher, director of the Center for Argentine Political Economy (CEPA).
Liquefaction against inflation, an element that affects activity
It happens that the fall in economic activity carried out by the Government in order to fight inflation through a income liquefaction means that, “given the decline in retail sales, logically, the SME industry registers a drop in the use of installed capacity,” according to Alfredo González, president of the Chamber of Medium Enterprises (CAME) to Ambit.
And he points out that, to this, there are added “different inconveniences that are being suffered with respect to the import of inputs with the SIRAs, before December, and then, payment in 120 days until recently, when they enabled us to pay in 30 days for purchases of inputs abroad.
On the other hand, as pointed out Daniel Rosato, president of Industriales Pymes Argentinos (IPA)In this regard, “installed capacity has been falling very sharply in some sectors, such as mass consumption, textile furniture and footwear, which are the most affected by a drop in activity, and less so in others.”
How installed capacity fell sector by sector
The INDEC numbers confirm this view, since the sectoral blocks that present levels of utilization of installed capacity higher than the general level are oil refining (79.2%), paper and paperboard (75.4%), chemicals and substances (67.8%), basic metal industries (66.5%), non-metallic minerals (59.6%) and food and drinks (58.1%).
Meanwhile, the sectoral blocks that are located below the general level are tobacco products (52.2%), editing and printing (51.3%), Automotive industry (47.3%), rubber and plastic products (45.9%), textile products (45.6%) and metalworking except automotive (37.3%).
This is a very low level, above all, for the metal-mechanical sector and also for the textile sector and this responds, as Rosato points out, to the fact that “the drop in sales is very strong in some sectors, such as textiles, which sank 50% last month.
Industry: a worrying outlook for the future
The most serious thing is that, for the businessman, The outlook ahead is worrying.. “We do not see that, in the future, this can be recomposed, although perhaps we will see an improvement based on the results of the joint ventures that are being negotiated, and that can reactivate consumption,” describes Rosato.
However, he warns that The big problem is that they are producing less and, although there may be an improvement in salaries, there is a cut in activity that affects fewer overtime hours and suspensions of activity, which may threaten an eventual recovery in consumption.
Letcher anticipates, on the other hand, that “another big problem going forward is that the impact of rates in March, April and May and, later, about the opening of imports, they suggest that it’s not going to get better” the panorama.
“Now, for example, in the textile sector the entry of merchandise from abroad“The same will happen with footwear and other items,” warns the IPA leader in the same sense.
And he adds that there is a serious problem with the disseminated input costs. “The Government has to resolve this because they are still worth twice what they cost abroad and, on the other hand, taxes are not going down and it is very complex to compete with other countries,” he describes.
From the entity, they warn that “we have not had such a complex panorama since 2018, when imports were opened indiscriminately and thousands of SMEs closed, but here we are on the path to an even worse scenario because we go back to what happened in the 1990s, with a high level of unemployment due to the closure of many factories,” Rosato warns.
Source: Ambito
