July 24 (Bloomberg) -- Argentina’s economy won’t fall into a recession this year, Cabinet Chief Anibal Fernandez said, even as economists forecast that South America’s second-biggest economy will shrink in 2009.

“We won’t get to that point,” Fernandez said on Buenos Aires-based television channel C5N today when asked if the country will enter a recession. “We won’t grow at Chinese rates either.”

Argentina’s economy will contract 3.3 percent this year after growing 6.8 percent in 2008, according to the median estimate of six economists surveyed by Bloomberg. The government on July 17 reported that the economy in May failed to post year- on-year growth for the first time since November 2002.

Industrial production rose for the first time this year in June, climbing 0.6 percent from a year earlier, the National Statistics Agency reported today in Buenos Aires. Output fell a seasonally adjusted 0.6 percent from May, the agency said.

Economists and politicians including Vice President Julio Cobos say the statistics institute’s reports overestimate growth and underestimate inflation. Economy Minister Amado Boudou unveiled on July 21 a plan to help “strengthen” the institute.

“The goal is to put an end to questions over the institute,” Boudou said.

Argentina’s 2009 budget, submitted in September, forecast growth of 4 percent for this year. Boudou, attending a regional summit in Asuncion, Paraguay, yesterday declined to give an estimate for economic growth this year, Buenos Aires-based newspaper La Nacion reported.

To contact the reporter on this story: Bill Faries in Buenos Aires at wfaries@bloomberg.net

Last Updated: July 24, 2009 16:01 EDT