According to estimates by the consulting firm ABECEB, the sectors with the greatest growth in 2022 will be knowledge-based services, in-person services (benefited by fewer restrictions and by the revenge of consumption), lproduction of household appliances (+16.1%) and consumer electronics (+15%), mining exports (+9.3) and vehicle production (+8.3%).

Nevertheless, This improvement will not even reach half of the rebound that those same sectors registered during this year. This slowdown is not only explained by the basis of comparison (2021 was against 2020 marked by the extensive quarantine) but also that the sectors face a double agenda: one, characterized by a weakened macro, with a lot of uncertainty, a world that will not have the tailwind of 2021 (soybeans+DEGS) and the risks of the new COVID variants. And the other agenda, with the challenges imposed by technological disruption and new consumer habits.

The production of household appliances had a rebound of 46.9%; that of consumer electronics of 54%, mining exports, 20; and vehicle production; 56.2%.

Pros and cons for home appliances

The household appliances sector faces, as positive factors, the negative real interest rate and the renewal of the Tierra del Fuego subregime and the Ahora plan. On the other hand, and on the negative side, ABECEB highlights the meager purchasing power and replacement consumption already carried out during 2020 and 2021.

Rebound, but anemic

This anemic rebound also occurs in steel production, which will increase 4.8% in 2022 and had grown 31.5% this year. Construction in 2022 will have an improvement at a rate of 4%, and this year it had reached 30.2%, and the production of pharmaceutical products, which in 2022 will increase by 4%, was halfway down from 8.9% in 2021.

Agricultural activity has heterogeneous prospects: the sale of agricultural machinery will increase by 2.7% in 2022 compared to 14.4% this year and the sale of fertilizers will increase 1.5% compared to 12.8% in 2021. Agricultural production (valued harvest) remains stable in 2022 (+0.3%) against an increase of 28.4% in 2021, while Soybean crushing will grow 2.1% compared to 17.4% in the current year. On the other hand, wheat milling will have a better 2022 with 4%, recovering from this year's fall (-3.9%)

The challenged macro and the challenges of technological disruption

Argentine industries are faced with the challenge of managing a double agenda: la of the obstacles, with high short-term uncertainty reflected in maximum exchange rate pressure, declining reserves and growing expectations of devaluation; in a framework of long-term structural deterioration that increases the challenges.

And the other: that of the catalysts, with the acceleration and confirmation of a new path in consumer preferences, the acceleration of the sustainability agenda, the changes in spatiality, and in the world of work that impose the need for transformation and provide opportunities to add value.

The latest bills sent to Congress attempt to provide some guidelines to guide productive activity through these challenges: the incentives proposed are not clear and, in some cases (Automotive Investment Law, Packaging Law and Electromobility Law, among others) they confuse the current challenges with the need to provide a strategic perspective, coordinated with companies and credible.

The economy enters 2022 with political weakness and a challenged macro, with authorities forced to make some corrections (tariffs and fiscal deficit), high inflation and modest growth.

The normalization of face-to-face activities and revenge consumption put entertainment and hospitality as drivers of a recovery of thin pockets (although the threat of Omicron challenges those who depend on inbound tourism). “COVID restrictions” and super stocks with salaries in low dollars generate captive tourists and sustain indulgent consumption.

He interventionist bias gives opportunities to rapidly maturing spot investments and protects the market for sectors sensitive to imports. The sheet is short: Import restrictions hinder the development of some markets: they limit the diversity of models available, and provide uncertainty in relation to some inputs. Added to the administration of imports are the risks of distortion of international value chains, with industries already affected by the chip and semiconductor crisis, as well as by cost pressure due to the increase in prices of widespread inputs: glass, plastics and steel, among others.

For those who depend on the National Budget the signals are mixed. For public works, although tenders are progressing at a good pace, payments are strained. On the tariff side, an average adjustment of 20% was announced, which is not enough to compensate for the delay since the inflation accumulated in the last two years prevents short-term normalization. For oil and gas, the focus is on ensuring domestic supply, in the midst of a continuous discussion about the window of opportunity that Vaca Muerta has in the face of the acceleration of transportation electrification and the energy transition. For oil, the differential is in the hands of those capable of exporting, although ensuring the local barrel. For gas, the Gas Plan is advancing favorably, even more so in a context of increasing LNG prices worldwide.