Real GDP grew by 4.5 percent in 2025 and is expected to grow by 2.1 percent in 2026, 3 percent in 2027 and 3.5 percent in 2028.
The economy was 0.4 percent smaller in 2024 than in 2011 and is expected to be 9.9 percent larger in 2027 than in 2024.
Investment projects worth $186.5 billion have been submitted to Argentina's program for large investments.
First time in nearly 20 years
Argentina's economy is expected to grow three years in a row, in 2025, 2026 and 2027. That has not happened in nearly two decades, according to the World Bank. The forecast is in the bank's new economic update on Latin America and the Caribbean.
Real GDP, meaning the size of the economy after adjusting for inflation, shrank by 1.4 percent in 2024. In 2025, it grew by 4.5 percent. For 2026, the World Bank expects growth of 2.1 percent. For 2027, the forecast is 3 percent, and for 2028 it is 3.5 percent.
The World Bank highlights El Salvador, Paraguay, Panama and the Dominican Republic as countries in the region with strong growth. According to the bank, Argentina is on a similar path.
Emerging from a long period without growth
The figures come after a long period when the economy stood still. In 2024, Argentina's real GDP was 0.4 percent smaller than in 2011. In 2027, it is expected to be 9.9 percent larger than in 2024.
According to the World Bank, lasting growth and long-term investment are not possible when inflation is close to hyperinflation and the risk in government debt is at crisis levels.
A surplus in the government budget
The bank attributes the growth to a tighter government budget, tax reforms and a more open economy. Argentina went from a large budget deficit in 2023 to a surplus before interest costs and a balanced budget after them. This happened through lower spending and by retargeting energy subsidies. Argentina's Congress has also approved labor market reforms.
According to the bank, the tighter budget has made inflation expectations more stable and reduced the risk in government debt. Inflation is also falling gradually. We have previously written that poverty in Argentina's cities fell to its lowest level since 2018.
Lower risk for lenders
The extra interest rate that lenders demand from the Argentine government, compared with loans to the US government, fell from an average of about 2,000 basis points in 2022 and 2023 to about 500 basis points in 2026. A basis point is one hundredth of a percentage point. The extra interest rate thus fell from about 20 to about 5 percentage points.
All three major credit rating agencies, S&P, Fitch and Moody's, have upgraded Argentina's credit rating. In 2026, the country has built up its foreign currency reserves, supported by a large trade surplus. This has reduced the risk that the government will be unable to repay its loans in the short term.
Energy, minerals and harvest
Exports of energy and critical minerals are now scaling up, according to the report. A large agricultural harvest also supports the economy in the near term.
Argentina's Congress has also voted to approve the trade agreement between the EU and Mercosur. According to the World Bank, the agreement could give Argentina broader access to markets once it fully takes effect.
Argentina has a program for large investments called RIGI. Projects totaling $186.5 billion have been submitted. Of these, projects worth $49.8 billion have been approved and projects worth $136.7 billion are under review. An expanded part of the program aims to attract investment in data centers and digital infrastructure for AI.
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