The problems facing Argentina after Russia's invasion of Ukraine

Despite how far away it is Argentina of the Ukrainian territory, where a new war began yesterday, the repercussions of the armed conflict are already beginning to be seen in the country.

This not only because the nation is in the middle of negotiations with the IMF, so for Argentina it is vital not to generate confrontations with the United States, which is also in the middle of the conflict.

Bombings and explosions continue in several cities of Ukraine.

Also because Russia’s invasion of Ukraine impacts the price of the dollar, energy, exports and generates increases in several products, which in some cases is beneficial for Argentinabut in others not so much.

In the context of exports, products such as soybeans, corn and wheat, which are mostly Argentina dispatch to other countries, international prices soared, which represents higher dollars for the country.

Soybeans were quoted at US$630, a price they hadn’t reached in almost a decade.

This, in turn, favors the Government, since a greater collection is generated in relation to export withholdings, which contributes to reducing the fiscal deficit and in turn favors the negotiation with the IMF.

For its part, the price of Brent oil at US$103 triggered energy values, which does not favor the domestic market as much, since the country imports a large part of this supply.

During his visit to Russia, Alberto Fernández assured that Argentina should be that country’s gateway to Latin America.

This, added to the price of the dollar, has a negative impact on the reserves of the Central Bank, since a greater outflow of dollars is generated due to increases in energy and other products, which in turn could lead to more increases for consumers.

Argentina will not apply economic sanctions to Moscow

Although Alberto Fernández rejected the military action by Russia, and urged Vladimir Putin to “stop the actions undertaken”, At the moment the Government does not foresee economic sanctions for that country.

The president requested that the “security of states and human rights” be guaranteed.

This, since Russia would be a strategic ally for Argentinaso it would not accompany the sanctions imposed by the European Union and the United States, in order to reduce the resources of the government of Vladimir Putin to finance the war.

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