Argentine SME Sales Extend 13-Month Slump as Colombian Growth Falters

Argentine small and medium-sized businesses endured their thirteenth consecutive month of declining retail sales in May, according to a survey released by the national SME confederation CAME. Sales contracted 1.2 per cent year-on-year in real terms, bringing the cumulative drop for the first five months of 2026 to 3.1 per cent. Although there was a modest 1.2 per cent month-on-month improvement from April, the sector remains mired in a protracted slump that has eroded consumption across all major categories.

Commerce owners reported a deepening pessimism: the share of firms describing their situation as worse than a year ago rose to 45 per cent, while those viewing conditions as stable declined. The outlook for investment was similarly glum, with nearly 60 per cent deeming the climate unfavourable. Yet a resilient minority—39 per cent—projected a recovery within the next twelve months, hopeful that the structural shifts in consumer behaviour, which have favoured online channels and essential goods, might eventually stabilise.

Meanwhile, on the other side of the Andes, Colombia’s economic momentum also showed signs of fatigue. Researchers at Bancolombia estimated that the economy expanded by 2.9 per cent year-on-year in the rolling quarter ending in May, a deceleration from earlier in the year. The slowdown was driven by weakness in construction and agriculture, sectors that had been key engines. The bank’s NowCast model indicated that second-quarter growth would come in below market expectations, tempering optimism that Latin America’s fourth-largest economy was on a firm recovery track.

Viewed from Buenos Aires and Bogotá, the two narratives underscore a broader regional challenge: sluggish domestic demand and hesitant investment. In Argentina, the persistent contraction in retail spending reflects a consumer still grappling with inflation and eroded purchasing power, even as some monthly upticks provide faint hope. In Colombia, the loss of pace in productive sectors suggests that the post-pandemic rebound is losing steam. Analysts in London note that while both economies face headwinds, their paths diverge—Argentina’s private consumption is in outright retreat, whereas Colombia’s remains expansionary, albeit at a slowing clip. The coming quarters will test whether policy shifts or external demand can rekindle these distinct, yet intertwined, engines of South American growth.