Argentina Retail Report Q1 2013

The Argentine Retail Report examines the long-term potential of the local consumer market, but flags short-term concerns about the impact on Argentina's economic outlook of the prospect of a sizeable currency devaluation in 2013.

The report examines how best to maximise returns in the Argentine retail market while minimising investment risk, and also explores the impact of deteriorating relations between Argentina and its key trade partners on the Argentine consumer and on the ability of producers and exporters to realise returns in the short term.

The report also analyses the growth and risk management strategies being employed by the leading players in the Argentine retail sector, as they seek to maximise the growth opportunities offered by the local market.

Argentine per-capita consumer spending is forecast to increase by 21% between 2013 and 2016, compared with a regional growth average of 17%. The country comes last in BMI's Latin American Retail Risk/Reward Ratings, although it performs slightly better for Risk.

Among all retail categories, consumer electronics will be the outperformer through to 2016 in growth terms, with sales forecast to increase by 18% between 2013 and 2016 – from US$6.14bn to US$7.25bn. PC penetration is fairly low at about 25%, and this is expected to climb to more than 30% by 2016, creating opportunities for vendors.

The Conectar Igualdad programme to provide 3mn PCs to public schools nationwide should provide opportunities for manufacturers and retailers alike.

Over the last quarter, BMI has revised the following forecasts and views:

?? BMI has revised down its 2012 real GDP growth estimate from 4.0% to 2.8%. Additionally, we now believe that persistent economic imbalances in the Argentine economy will lead to a sharp reduction in economic growth and a significant devaluation of the peso in 2013. We are revising down our 2013 real GDP growth forecast from 3.7% to 0.9%, after which point we believe the effects of a 25% devaluation in 2013 will pave the way for stronger growth for the remainder of the decade.

?? BMI has revised down its 2012 private consumption growth forecast from 4.0% to 3.5%. We see the impact of a currency devaluation hitting real private consumption growth particularly hard in

2013. We forecast that consumer price inflation will average 25% in 2013, and unemployment will end the year at 8.5%, which will see private consumption growth remain flat in real terms. ?? Latest data show that retail sales in Argentina rose by more than expected in September 2012, to a seasonally adjusted 27.5%, from a revised 31.9% in August. Analysts had expected a September increase of 24.2%.

Table of contents

Chapter - Executive Summary

Chapter - SWOT Analysis

Argentina Retail Business Environment SWOT

Argentina Political SWOT

Argentina Economic SWOT

Argentina Business Environment SWOT

Chapter - Market Overview

Current Trends

Key Players

Chapter - Industry Forecast Scenario

Retail Growth Outlook

Table: Retail Sales Indicators, 2009-2016

Macroeconomic Outlook

Table: Argentina - Economic Activity

Regional Retail Outlook

Table: Latin America Retail Trends, 2009-2016

Table: Regional Retail Sales, 2009-2016 (US$bn)

Table: % Of Regional Retail Sales, 2009-2016

Table: Regional Food Consumption, 2009-2016 (US$bn)

Table: Regional Mass Grocery Retail, 2009-2016 (US$bn)

Regional Retail Trends

Risk/Reward Ratings

Table: Regional Risk/Reward Ratings

Argentina's Retail Rating

Limits To Potential Returns

Risks To Realisation Of Returns

Chapter - Consumer Electronics

Argentina Consumer Electronics Market SWOT

Market Overview

Computers

Table: PC Sales, 2009-2016

AV Devices

Table: AV Sales, 2009-2016

Mobile Handsets

Table: Mobile Communications, 2009-2016

Industry Forecast Scenario

Consumer Electronics Market

Table: Consumer Electronics Overview, 2009-2016

Industry Developments

Chapter - Automotives

Argentina Autos Industry SWOT

Industry Forecast Scenario

Domestic Sales

Table: Argentina Autos Sales, 2009-2016

Table: Argentina Autos Production, 2009-2016

Trade

Table: Argentina Autos Trade, 2009-2016

Economic Contribution

Table: Argentina Autos Sector Economic Contribution

Chapter - Commercial Vehicles – Forecast & Analysis

Table: Argentina Commercial Vehicle Segment, 2009-2016

Light Commercial Vehicles

Table: Argentina Light Commercial Vehicle Sales By Manufacturer (Units), 2010-2011

Table: Argentina Light Commercial Vehicle Production By Manufacturer (Units), 2010-2011

Heavy Commercial Vehicles

Table: Argentina Heavy Commercial Vehicle Sales By Manufacturer (Units), 2010-2011

Table: Argentina Heavy Commercial Vehicle Production By Manufacturer, 2002-2010 (CBUs)

Buses

Table: Argentina Bus Sales By Manufacturer, 2007-2011

Table: Argentina Bus Production By Manufacturer, 2002-201 (CBUs)

New Investments

Table: Argentine Fleet Renovation Plan

Chapter - OTC Pharmaceuticals

Argentina Pharmaceuticals And Healthcare Industry SWOT

Market Overview

Pricing Regime

Table: Pharmaceutical Price Build-Up

Table: Drug Price Freeze, 2005-2008

Reimbursement Regime

Chapter - Demographic Outlook

Table: Argentina's Population By Age Group, 1990-2020 ('000)

Table: Argentina's Population By Age Group, 1990-2020 (% of total)

Table: Argentina's Key Population Ratios, 1990-2020

Table: Argentina's Rural And Urban Population, 1990-2020

Related research categories

By sector: Retail (in Off-trade)

By market: Argentina (in South America)