Argentine economy faces possible recession

Special Report:Global Financial Crisis

BUENOS AIRES, Feb. 4 (Chinese media) -- Former Argentine economic minister Martin Lousteau warned Wednesday of a possible recession in the country due to the international financial crisis, which will produce more unemployment and higher costs of living.

Demand of labor in the capital Buenos Aires' metropolitan area dropped 42 percent in January compared with the same period in 2008, according to a report released Wednesday by Torcuato Di Tella University.

Analysts from the university, which has released reports every month since 2000, projected that "a bigger drop in labor demand, associated with a rise in unemployment" will emerge in the short term.

Meanwhile, the real estate market in Buenos Aires decreased 6 percent in 2008 from the previous year, the city's Notary Public College said.

According to the number of ownership documents, there was a strong drop in house sales last December. In 2008, some 69,100 ownership documents were signed in Buenos Aires, compared with over 73,500 in 2007.

In November 2008, the drop was almost 24 percent and in December the contraction reached 31.5 percent compared with the same period in 2007.

The commercial fishing sector has also been affected, with a year-on-year reduction of 60 percent in January, according to the Argentine Fishing and Aquaculture Ministry.

Lousteau strongly criticized the crisis-management programs previously announced by the Argentine government, which he said would not succeed in improving the situation.

"The most important thing is to have the right diagnoses and recognize the problems amid the financial crisis," he urged.