Argentina’s industry records the second-worst decline worldwide in two years

Can U.S. dollar save Argentina? A supporter of Argentina's president Javier Milei displays a $100 bill placard with an image of the president
Photo: AFP

Argentina recorded the world’s second-worst industrial decline from 2023 to 2025, said a consulting firm ‘Audeumus’ that analyzed data from the United Nations, ‘Buenos-Aires Herald’ reports.

In the last two years, Argentina’s manufacturing sector fell by 7.9%, surpassed only by Hungary, which fell by 8.2%, said the consultancy Audemus, founded by former Minister of Productive Development Matías Kulfas.

The report said that while in Europe the causes for the crisis are partly exogenous — “the energy shock, Chinese competition in the automotive sector, and trade tensions with the United States” —, the manufacturing situation in Argentina “is a response to domestic economic policy decisions.”

“The global or regional context cannot explain Argentina’s industrial decline,” the report added.

“The crisis is local, has identifiable causes, and is a response to an economic policy orientation that the current government is not only failing to review but is defending as a virtue,” it said.

In their investigation, Audemus added that the regional data is most telling, as “Brazil expanded its industry by an average of 3.5% over these two years” and that Chile (+5.2%), Peru (+6.5%), and Uruguay (+3.7%) also grew. Colombia and Mexico declined, the report said, “but within minimal ranges (-0.7% and -0.4%).”

Factories closed and jobs lost

Since Milei took office, Argentina’s manufacturing sector has struggled amid import liberalization and weak domestic demand. So far, during the libertarian economist’s administration, more than 2,400 industrial companies have closed and 73,000 manufacturing jobs have been lost, according to official data — 5% of the country’s total industrial companies, said Audemus.

According to the national statistics institute, the INDEC, factories are operating at just 53.8% of installed capacity.

A senator for the ruling party, La Libertad Avanza, Francisco Paoltroni, said that under previous protections, business owners were “hunting at the zoo”, arguing that Argentina should focus on sectors where it is “naturally competitive” – agriculture, livestock, mining, oil and gas. “What God gave us,” he told the Herald.

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