Argentine economy to shrink in 2019, but less than expected: OECD

BUENOS AIRES, March 6 (Xinhua) -- Argentina's weak economy will continue to shrink in 2019, but less than previously expected, the Organization for Economic Cooperation and Development (OECD) said on Wednesday.

The economy is projected to see its gross domestic product (GDP) contract by 1.5 percent, a slight improvement over the organization's last report in November, which forecast a 1.9-percent contraction.

The economy contracted an estimated 2.5 percent in 2018, according to the OECD's preliminary figures. The country's official fourth quarter results for 2018 won't be issued until March 21 by the national statistics institute INDEC.

"Output continues to contract in Argentina, following the financial market turmoil experienced last year and the subsequent tightening of fiscal and monetary policies," the OECD said in its latest report.

In 2019, the South American country's economy should see a "gentle recovery" as the devalued national currency makes exports more competitive and agricultural activity rebounds after recent droughts.

Booming exports should buoy the economy to see a 2.3-percent growth in 2020, the OECD said.

But Argentina needs to carry out reforms that improve the outlook of its fiscal and financial sustainability in the medium term, the report added.

Argentina's economy, the third largest in Latin America after Brazil and Mexico, had a volatile year in 2018, with inflation running at close to 50 percent and its currency diving against the U.S. dollar.