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5h ago

Argentina Manufacturing Payments Strain Deepens as UIA Flags Widespread Delays

Rising interest rates are choking bank credit, driving a spike in bounced checks.

An employee moves boxes at Lumilagro’s factory, which now operates only one of its four assembly lines due to cheaper imported components and reduced demand, as Argentines face reduced consumer purchasing power under President Javier Milei’s austerity measures, in Tortuguitas, on the outskirts of Buenos Aires, Argentina, October 3, 2025. REUTERS/Agustin Marcarian fabrica industria termos termo empleo oficios metalurgia metalurgica vidrio plastico
Crisis en la industria: peligra la cadena de pagos en el sector manufacturero (Archivo).
Industria argentina: problemas de pagos y alza en los cheques rechazados.

Overview

  • A UIA survey of 711 manufacturers found 47.5% struggling to meet at least one key obligation, with 8.2% delayed across all payment types.
  • Payment stress is most acute in taxes and suppliers, cited by 29.3% and 26.7% of firms respectively.
  • The UIA’s Industrial Performance Monitor registered 43.8 points for November, marking a 14th straight month below the expansion threshold with textiles, basic metals, and leather/footwear among the worst hit.
  • Industry sources report a 30–40% jump in bounced checks in the past quarter, with more transactions shifting to cash and bank transfers as state payment terms lengthen to 60–90 days.
  • Company financing contracted in real terms after rate hikes in the second half of 2025, prompting job cuts, shift reductions, and suspensions, with Bodega Norton’s series of rejected checks underscoring firm-level distress.