Is there no end in sight to Argentinas fall from grace? Not according to ECR contributors. The sovereign has continued its trend decline in ECRs global rankings since Q2 2012, falling two places to 107th on the back of a 0.3 point fall in its score to 35.5.
The increased risk has seen Argentina overtaken by improving Dominican Republic and in danger of slipping below Liberia (108th) and Bolivia (109th).
In conjunction with a lower score for access to capital, ECRs panel of 39 Argentina experts has collectively downgraded the countrys political, economic and structural risk assessments this quarter.
The economic downgrade has been driven by concerns about monetary policy/currency stability and government finances, which is not surprising given the countrys fiscal predicament. However, judging the budget for 2013 is difficult in light of the assumptions used, which are vastly out of line with private-sector estimates.
Transparency an often-overlooked factor is a particular risk for investors in Argentina, one of four political indicators scoring less than three out of 10, and an issue that has brought rebuke lately from the International Monetary Fund (IMF).
Add into the mix investor concerns about repatriation in light of the countrys history of default and the April nationalization of oil firm YPF, amid an array of other political, economic and structural factors, it seems that for now Argentina remains one of Latin Americas highest risk options.