Argentina's economy

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Argentina
ArgentinaArgentina
World economic rank 21. (nominal)
28. (PPP)
currency Argentine Peso (ARP)
Trade
organizations 		WTO
Key figures
Gross domestic
product (GDP) 		$ 637.7 billion (nominal) (2017)
$ 911.5 billion ( PPP ) (2017)
GDP per capita $ 14,467 (nominal) (2017)
$ 20,876 (PPP) (2017)
GDP by economic sector Agriculture : 10.9%
Industry : 28.2%
Services : 60.9% (2017)
growth   −2.5% (2018)
inflation rate 34.3% (2018)
Gini index 42.7 (2014)
Employed 18 million (2017)
Employed persons by economic sector Agriculture : 0.5% (2014)
Industry : 24.8% (2014)
Services : 74.7% (2014)
Unemployment rate 8.1% (2017)
Foreign trade
export 59.69 billion (2017)
Export goods Soybeans, meat, petroleum and gas
Export partner Brazil : 15.5%
USA : 7.7%
China : 7.6%
Vietnam : 4.4% (2016)
import 60.78 billion (2017)
Import goods Machines, electronics, automobiles, petroleum
Import partner Brazil : 24.3%
China : 18.7%
USA : 12.5%
Germany : 4.4% (2016)
Foreign trade balance 4.50 billion (2017)
public finances
Public debt 53.7% of GDP (2017)
Government revenue $ 123.2 billion (2017)
Government spending $ 161.1 billion (2017)
Budget balance −6.1% of GDP (2017)

For climatic reasons, the economy of Argentina is traditionally characterized by the agricultural sector and the related industries . In the course of the 20th century, other branches of the economy have settled, so that today industries of all kinds and a wide range of services complement the local economy.

Argentina was one of the richest countries in the world until the early 1950s and had a level of prosperity comparable to that of other immigration countries such as Canada and Australia . Due to various crises, however, it fell far behind these countries in the second half of the 20th century. Today Argentina is usually referred to as a so-called emerging country or emerging market , as the level of the economy, both in terms of gross national product per capita and social indicators such as the poverty rate or child mortality, is no longer comparable with industrialized countries. In this respect, Argentina can be seen as a special case, since it has not dropped from a low, but from a very high stage of development to a medium level. It is only since the 1990s that there have been tendencies that point to a reversal of this process.

According to the World Economic Forum's global competitiveness index , Argentina ranks 92nd (out of 137 countries) of the most competitive countries in the world. In the index for economic freedom , the country ranks 156 out of 180 countries (2017).

economic sectors

The most important economic sector in Argentina is the tertiary sector ( services ), which contributed 55% to the gross domestic product (GDP) in 2005, followed by the secondary sector (extractive and manufacturing industry) with 35.6% and the primary sector (agriculture) with 9.4%. Compared to 2000, the importance of agriculture and industry increased, while the share of the service sector decreased significantly.

Agriculture

Agriculture traditionally determined the economy of Argentina and still today, together with the production of energy sources, carries the largest part of Argentine exports, despite its relatively minor importance for the economy as a whole. The dominant sectors are agriculture and animal husbandry . The fishing and forestry play only a subordinate role, despite the long coastline and vast wooded areas.

The most important growing area in agriculture is the humid pampas . Also important are the east of the Gran Chaco region , as well as the oases and river valleys of western Argentina ( Cuyo ) and Patagonia. The crops grown differ depending on the climatic zone. In the subtropical north, tobacco , rice , sugar cane and cotton are dominant, in the temperate center soybeans , wheat , maize and sorghum , in the dry regions of western Argentina and Patagonia, on the other hand, mainly fruit (e.g. viticulture in the Cuyo, apples in the valleys Northern Patagonia).

Livestock is practically all over the country, but this is where the most important areas of the Pampas are located. The main focus is on cattle breeding , both for meat and milk production. Sheep farming dominates in the drier areas .

The fishing is just regional importance. The main center is Mar del Plata . The forestry is regionally significant in Chaco, Misiones and in the southern Andes.

Mining and extractive industries

Unlike in some neighboring countries, mining plays only a minor role in Argentina, with only non-metals being mined nationwide. The only mining areas for metals are in the Andes region , in the province of Catamarca (Minera Alumbrera) and Jujuy ( El Aguilar ) and Santa Cruz . The total value of the extraction of metals in 2003 was 50 million, that of stone was 181.8 million and that of other non-metals was AR $ 94.9 million.

On the other hand, the extraction of fossil fuels such as crude oil and natural gas , which contribute a considerable part of the gross national product, is of great importance . However, the deposits are limited, although efforts are made to develop new deposits.

Processing industry

Since the forced industrialization after the Great Depression around 1930 Argentina has developed a diversified industry. Important sectors of industry are the automotive industry , the food industry ( agribusiness ), the construction industry , metal processing and the chemical industry ; in addition, the textile industry is of regional importance.

The traditional industrial centers are the metropolitan area of Gran Buenos Aires / La Plata , Rosario , Córdoba , Bahía Blanca , Mendoza and San Miguel de Tucumán . Some cities in formerly structurally weak regions such as Neuquén , San Luis , Río Grande and La Rioja have experienced rapid industrial development since the 1980s, partly due to their proximity to energy and raw material deposits (in the case of Neuquén), but also partly from government industrial promotion programs. San Luis and Tierra del Fuego in particular are regarded as regional tax havens for companies, where the provincial taxes for new companies have been reduced or even completely waived for decades.

Service sector

The service sector is the dominant sector of the Argentine economy today. Much of this is in the financial and retail sectors , which are concentrated in the big cities.

According to a study by the Asociación de Bancos de la Argentina from September 2006, the five most important banks in Argentina are the state-owned Banco de la Nación Argentina , Banco Francés (branch of the Basque BBVA), Banco Río de la Plata (part of the Spanish financial group Grupo since 2007 Santander ), Banco de la Provincia de Buenos Aires and Banco de Galicia (branch of Banco Popular Español). There are also numerous other banks, some of which are branches of foreign financial groups ( Standard Bank , Citibank , HSBC ), and others, some of which are state-owned, some of which are private, and which operate either on a national or regional basis.

The exchange with the largest trading volume is the Bolsa de Comercio de Buenos Aires . Its most important share index is the MERVAL (abbreviation for Mercado de Valores ). The only other exchange of importance is the Bolsa de Comercio de Rosario ( Rosario ). There are also exchanges with a small but existing trading volume in Córdoba , Santa Fe , Mendoza and La Rioja (temporarily inactive), and the Bolsa de Comercio de la Patagonia was founded in Ushuaia in 2005 . There are inactive exchanges in Paraná , Bahía Blanca , San Miguel de Tucumán , La Plata and Corrientes .

The trade shows a high level of development. Important trading centers are the port cities of Buenos Aires and Rosario (with some restrictions also Santa Fe and Bahía Blanca ), which dominate foreign trade, as well as Córdoba, Mendoza and San Miguel de Tucumán as regional trading centers. The province of Tierra del Fuego , in which there is a customs exclusion zone , has a special position .

The transport sector is concentrated on road transport, which hardly faces competition from other forms of transport, either in freight or passenger transport. River navigation only plays a regional role, as apart from Paraná and Río Uruguay only a few rivers are navigable. Rail transport played an important role in the first half of the 20th century, but today many lines have been closed; because of the poor condition of large parts of the rail network because of the lower speed pressure, freight transport is in the lead well ahead of passenger transport (only regionally important). This is due to a lack of investment, especially since the privatization of the rail network in 1993. However, the Néstor Kirchner government has started a reactivation program to rehabilitate important routes and also to revive passenger transport. Apart from overseas passenger transport, air traffic is of very little importance, which has been even less important and is only slowly recovering after the devaluation in 2002, which plunged the sector into a deep crisis.

Since the economic crisis of 2002, the importance of services to foreign customers, such as call centers and the software industry, has grown . The reason is the high quality of the Argentine products with comparatively low labor costs .

See also: Tourism in Argentina

Foreign trade

Argentina’s most important trading partners are the Mercosur states, including Brazil in particular .

Imports came primarily from Brazil ($ 10.3 billion) in 2006 , according to unofficial statistics from Scavage . It is followed by the USA with 3.4 billion, the People's Republic of China (2.7 billion), the Federal Republic of Germany (1.3 billion) and Mexico (1 billion).

The main export partner is also Brazil (9.8 billion US $) followed by Chile (5.7 billion US $), the USA (5.5 billion US $), Spain (4.4 billion US $) and the People's Republic of China (US $ 4.4 billion).

Energy production

Extraction of fossil fuels

There are oil and gas deposits in many parts of Argentina, but coal extraction is of little importance.

The traditional deposits for oil and natural gas are located on the one hand in the northwest (east of Jujuy , north of Salta ), east of the central Andean region ( Mendoza and Neuquén ) and on the Atlantic coast of Patagonia (east of Chubut and Santa Cruz , north of Tierra del Fuego ). More recently discovered deposits are in the west of Formosa , off the Atlantic coast and in Córdoba . The only significant hard coal deposit is located near Río Turbio in the south of the Santa Cruz province. There are also relatively significant uranium reserves in the provinces of Chubut, Mendoza, San Luis, Córdoba, La Rioja and Salta.

It produces 745,000 barrels of crude oil a day and 44.8 billion cubic meters of natural gas in 2004. This means that Argentina is able to meet its domestic needs (470,000 barrels of oil / day and 37.85 billion cubic meters of gas) and to export some especially to Chile . The estimated reserves amount to 2,116 billion barrels of oil and 612.5 billion cubic meters of natural gas (2006).

Biofuels

There have been trials with biofuels since the 1970s. The trigger was the crisis in sugar cane cultivation in the province of Tucumán due to falling prices for this raw material. At that time, the so-called Alconafta plan provided for a mixture of gasoline and ethanol produced from sugar cane , which were sold at petrol stations.

Today, due to the critical energy situation in the country, increasing focus on the cultivation of high-energy plants will be made again from 2004. The cultivation of soy , which is also used for food production, is particularly important .

electricity

Electricity production was characterized by thermal power plants until the 1970s. Since then, it has been supplemented by nuclear power and renewable energies (especially hydropower).

Electricity production in 2005 was divided into the following types of generation:

Type of generation Installed power (kW) percent Production 2005 (MWh) percent
Thermal power plants 14,707,923 57.29 55,509,853 57.43
Natural gas (combination cycle) 4,453,500 17.35 23,728,776 24.55
Steam power (combination cycle) 2,573,900 10.03 12,401,435 12.83
Diesel oil 392.185 1.53 229.024 0.23
Gas turbine 2,737,338 10.66 5,297,471 5.48
Steam turbine 4,551,000 17.73 13,853,147 14.33
Renewable energy 9,948,677 38.75 34.267.760 35.46
Hydropower 8,946,222 34.84 33,450,674 34.61
Pumped storage plants 974,000 3.79 741.624 0.77
Wind power 27,829 0.11 75,381 0.08
Geothermal energy 600 0.003 k. A. k. A.
Solar power 26th 0.0001 81 0.0001
Nuclear power 1,018,000 3.96 6,873,301 7.11
total 25,674,800 100 96.650.913 100

There are nuclear power plants in Atucha (Province of Buenos Aires , 370 MW) and Embalse (Province of Córdoba , 648 MW). Atucha II , although under construction since the 1980s, is not yet completed; it is expected to deliver 692 MW upon completion.

The largest hydropower plants are Yacyretá -Apipé ( Corrientes province , total 3.1 GW, of which 1.55 GW is Argentine, joint project between Argentina and Paraguay ), Salto Grande ( Entre Ríos province , 1.89 GW, of which 945 MW is Argentinian, joint project between Argentina and Uruguay ), Piedra del Aguila (1.4 GW, Neuquén Province ), El Chocón (Neuquén Province, 1.34 GW) and Alicura (Neuquén Province, 1.04 GW). With the two binational power plants it should be noted that although only the Argentine share (half) is given in the national statistics, in the case of Yacyretá almost all of the electricity is consumed in Argentina, the electricity of the Paraguayan half is thus classified as "electricity import" recorded.

The only wind farm of importance so far is Antonio Morán near Comodoro Rivadavia ( Chubut ) with an output of 17.5 MW. Because of the enormous potential of this form of energy, especially in Patagonia, as well as the high installed capacity in hydropower, which can be easily combined with wind power because of its good controllability, significantly larger parks (300 MW in total) are planned in Chubut and La Rioja for the next few years . The reasons for the so far restrained development in wind energy are the low electricity prices in Argentina and, with the exception of the province of Chubut, the lack of a state-sponsored wind energy program. In addition, the best locations for wind farms are in southern Patagonia, but the power grid in this region has not yet been set up for the large power fluctuations caused by large wind farms.

So far, geothermal and solar power plants have only been used to a very limited extent. Good locations for geothermal energy are in Neuquén, Santiago del Estero and Salta, while solar energy can be obtained most cheaply in the sunny highland areas of the provinces of Jujuy, Salta and Catamarca , where it has been used on a small scale since the 1990s.

Development of the economy

The history of Argentina's economic development has been shaped by numerous ups and downs, which have been accompanied by numerous paradigm shifts. There were phases of high growth as well as marked cuts and economic crises, the most important of which were around 1890, between 1975 and 1982, 1989/90 and 1998–2002 ( Argentina crisis ).

Colonial times

In the colonial era, only the north-west of Argentina was of economic importance, where a mixture of mining and agricultural production was practiced, following the example of the Andean countries. The reason was above all Spain's strict trade policy, which stipulated that the exchange of goods with the mother country had to be carried out via Lima . Only in the course of the 18th century did the region around the port of Buenos Aires become more important after the trade restrictions were gradually abolished.

The establishment of the Viceroyalty of the Río de la Plata and the associated abolition of all trade restrictions can be seen as a turning point in the development of the Argentine economy. From then on, the so-called littoral , the area around Buenos Aires and the banks of the Río Paraná , became the economic center of the country inexorably.

Slow post-colonial development (1810-1860)

With the independence of Argentina, the basis was laid for the country's independent economic development. However, due to the very low population density and the numerous political conflicts, there was initially no high growth.

Livestock, the first significant economic activity in the first half of the 19th century, was largely at an informal level in the early 19th century. This was also due to the fact that, apart from leather and wool, no products could initially be exported due to a lack of preservation options. This began to change with the technology of salting in, and more and more live cattle (especially cattle) were exported over the years. Nevertheless, the final boom was still a long time coming, until the advent of refrigeration factories (around 1880).

In addition, after independence, there were the first large-scale plantings of grain and vegetables in the region around Buenos Aires, so that the needs of the local population could be largely satisfied and the level of prosperity was higher than in most European countries.

The reign of Juan Manuel de Rosas (1832 to 1852) was marked by stagnation, as his economic policy at the time rejected modern foreign development concepts, from which the country could have benefited, in favor of a conservative model that promoted the oligarchy. It was only after the fall of Rosas that the country's economy began to thrive.

Export boom and modernization (1860-1930)

The second half of the 19th and first years of the 20th century brought Argentina a huge development boost. Between 1860 and 1914, real gross domestic product grew by an average of seven percent a year, between 1914 and 1930 it was still four percent. This boom was due to several reasons. On the one hand, the country had largely stabilized politically after 1860 with the establishment of the Republic of Argentina , and Rosas' conservative economic model was replaced by an export-oriented economic policy based on a liberal model. Second, the expansion of the rail network, in particular through British capital, led to a significantly improved infrastructure, which particularly benefited the agricultural sector. Thirdly, immigration from Europe from the reign of Nicolás Avellaneda laid the basis for the country's industrialization. The rise in the general level of education after Domingo Faustino Sarmiento's reforms also contributed to the economic development process.

During this period, the Argentine economy was still characterized by the agricultural sector, which, however, favored an initial phase of industrialization. In particular, many immigrants founded their first successful companies, including the textile company Fábrica de Alpargatas Argentina and the Quilmes brewery . The refrigerated factories also began to prosper towards the end of the 19th century and favored the export of beef in particular.

In 1889 there was the first global economic crisis. This also took Argentina with it, as export income fell drastically; Another obstacle was the uncontrolled new indebtedness caused by the lavish policies of the Partido Autonomista Nacional (PAN) government, characterized by corruption and nepotism . Although the crisis brought about a brief collapse in growth followed by high inflation, it was primarily politically significant; for example, the Unión Cívica Radical (UCR) was the first opposition party to be founded. Another direct effect of this crisis, which was only noticed abroad, was the analysis of this crisis by the German entrepreneur Silvio Gesell , then living in Argentina , which led to his theories of free economy , which, however, are of little importance in today's economic theory.

With the takeover of power by the UCR and the introduction of a real democracy in 1916, the economic model was initially hardly modified and continued to orientate itself towards the liberal concept. However, during this time the first industries in the field of capital goods (machines, etc.) developed.

In 1929 the Great Depression called the Argentine model into question as a whole. The industrialized countries built up high trade barriers in the following years, so that Argentina, with its export-oriented economy, was particularly hard hit by the crisis. A direct effect was the political change: the military coup in 1930 and the renewed takeover of power by the conservatives.

Import substitution and economic nationalism (1930–1955)

As a result of the economic crisis, which resulted in a 14% decline in the gross domestic product in Argentina between 1929 and 1932, the new military government tried to start an economic policy oriented towards the domestic market. It pushed industrialization through import substitution by introducing a protectionist trade policy with high protective tariffs and quantitative import restrictions. This led to the fact that Argentinian companies were founded in almost all industrial sectors soon afterwards. In contrast, the agricultural sector stagnated due to high export prices, so that economic growth between 1933 and 1943 averaged just one percent. This phase also saw the establishment of the independent Argentine central bank (1935) and the introduction of income tax .

During the period of military rule (1943–46) and particularly during the first reign of Juan Perón (1946–51), this model was deepened. Additional protection mechanisms were created for Argentinian companies and the nationalization of some companies (e.g. the railways and mineral oil production) was promoted. In addition, Argentina benefited from the aftermath of the Second World War, which was initially noticeable in a large increase in foreign currency reserves, which enabled Perón to introduce extensive social security, especially for workers. As a result of these measures, economic growth could be increased again to an average of 3% in the year between 1946 and 1951. However, this was accompanied by a lack of a long-term, self-sustaining economic strategy, accompanied by stagnating productivity, which had a negative impact especially from 1949, when the country's foreign currency reserves declined due to the high costs, especially of the social programs introduced by Perón.

In Perón's second reign, the protectionist model was relaxed somewhat. Foreign investments were specifically attracted to promote the development of capital-intensive sectors such as the automotive industry ( Industrias Kaiser Argentina / Renault, Fiat ). Nevertheless, it was not possible to break through the economic stagnation. The agricultural sector in particular had been disadvantaged by the Peronist government compared to industry, which was not only reflected in a decline in the importance of this branch of industry, but also in widespread rural exodus and the resulting formation of slums , the so-called villas miserias , in the big cities. because the rural population had fewer and fewer prospects in agriculture.

The instability phase (1955–1976)

In the period between 1955 and 1976, in addition to the failures of the Perón government, in particular the stagnation of productivity and foreign trade, the Argentine economy also suffered from a constant paradigm shift. It was possible to increase economic growth again somewhat (3.5% between 1956 and 1976), but in view of the relatively high population growth, this meant only little progress in the level of prosperity. In addition, the strongly fluctuating and at times extremely high inflation increasingly became a slowing factor for the development of the economy.

Three economic schools dominated the phase: On the one hand there were the classical liberals, who were convinced of the opening of the markets and the reversal of nationalizations under Perón. The so-called desarrollistas (proponents of economic development) pursued a more moderate ideology, which was primarily concerned with improving the competitiveness of the Argentine economy. The third group were the nationalists who wanted to continue Perón's model with small corrections. Because of the political instability in this epoch with numerous coups and changes of government, all three paradigms were each applied for a short time, so that long-term planning of the economy was hardly possible.

Under Arturo Frondizi (1958–1962) the model of the desarrollistas was first used. This initially had positive effects, such as the increase in the productivity of industry and the extensive mechanization of agriculture, which, however, had fallen far behind technologically due to its stagnation in previous years. In addition, the government continued to seek to attract foreign investment without significantly easing trade restrictions. During the reign of Arturo Illias (1963–1966), the model again approached the nationalist politics propagated by Perón, with which very high growth rates were achieved for a short time. However, due to the short phase, this had little impact on development.

In 1966, with the military dictatorship under Juan Carlos Onganía and his successors, the so-called Revolución Argentina , a clear paradigm shift began again. This time, more liberal elements were integrated into economic policy. The model was only partially successful: although more foreign capital flowed into the country again, the productivity disadvantages of the Argentine companies made themselves felt for the first time, which led to a sharp rise in unemployment as a result of rationalization and the bankruptcy of numerous companies. As a result, there were violent protests by workers such as the Cordobazo in the late 1960s, which heralded the end of this dictatorship (1973).

In the third phase of Perón's government (1973-74) attempts were made to reconcile the economic sectors with one another. However, this was not crowned with success. Argentina was experiencing increasing export difficulties and falling into ever higher foreign debt, while inflationary pressure also intensified. This scenario worsened during the reign of Isabel Perón (1974-76). Two liberal economic reforms brought no improvement, on the contrary, an explosion of inflation to values ​​of up to 600% per year and an acute shortage of goods. Economic difficulties were among the main reasons for the 1976 military coup.

The neoliberal phase (1976 to 2001)

The military dictatorship of the so-called process of national reorganization 1976-83 finally introduced the liberal model in Argentina in the shape of the Minister of Economics Martínez de Hoz . The reorganization policy, which primarily aimed to attract foreign investors by removing numerous import restrictions and tariff cuts, was only crowned with success for a short time. Investment was slow to pick up and, although inflation could be reduced by limiting monetary expansion, it remained very high at 160% in 1976 and 80% in 1977. In addition, the social costs were enormous, as real wages fell by almost half in these years, which could only be achieved through the suppression of the trade unions with means of state terror.

Most devastating for the economy was the decision to introduce a devaluation in small steps, the so-called tablita . This should lead to better predictability of the external value of the currency by foreign investors, but the effect was a wave of speculation on an unprecedented scale. It was given the catchphrase plata dulce (Spanish for “sweet money”) and consisted of the fact that profits could be made by cleverly exchanging the Argentine peso ley for foreign currencies at the moment of devaluation. When the system gradually fell apart as a result of this wave at the beginning of the 1980s, a wave of capital flight followed. As a result of this development, the country's foreign debt increased from $ 5 billion to $ 20 billion during the military's reign. In addition, the industry was severely weakened, since most of the factories exhibited strong productivity disadvantages abroad and the rapid tariff reductions caught them unprepared. Industrial production fell by around 20%, while unemployment rose significantly.

After Raúl Alfonsín came to power in 1983, further attempts at restructuring were made as inflation had risen again in the meantime. The most important of these, the Austral Plan in 1985, consisted of a general freeze on wages and prices, accompanied by a rigorous austerity policy to stop inflation, while the new Australian currency was introduced. However, this program was only successful for a short time, as inflation picked up again in 1987 and made further devaluations of the Austral necessary. In 1988 and 1989 the threshold to hyperinflation was exceeded, and at the same time the government got into financial difficulties - Argentina was in a hitherto unimagined economic crisis, which caused the poverty rate to rise from around 10% to 47% in a very short time. After Carlos Menem came to power in 1989, numerous plans were made to convert private accounts into bonds. The BONEX plan converted all savings accounts into bonds and resulted in a loss in value of about 70%. The plans were crowned with short-term success, and soon afterwards inflation continued to rise.

It was not until 1991 , when the Minister for Economic Affairs, Domingo Cavallo , that he was able to stop this problem by pegging the Argentine currency to the US dollar (at a rate of 10,000 to 1). This measure was accompanied by a complete economic program which, for example, forbade raising wages in line with inflation ( indexation ). In addition, foreign trade was liberalized from a monetary point of view and numerous state-owned companies were privatized in order to allow the shrunken foreign exchange reserves to rise again. However, these measures also resulted in some very controversial sales, such as the case of the natural gas company Gas del Estado , which had made quite a profit. The privatization of the railway company Ferrocarriles Argentinos , which led to a severe deficit in the infrastructure and the closure of numerous lines, is also controversial to this day .

In terms of combating inflation, the Ley de Convertibilidad , as the package of measures was called, was initially very successful. The poverty rate has also been reduced to around 15%. Nevertheless, Argentina's inflation was still comparatively higher than that of the USA, which is why the peg of the peso to the US dollar led to an overvaluation of this currency around the mid-1990s.

The economic crises of the 1990s in Latin America also had a negative impact. The tequila crisis led to a recession of around four percent in 1995, and the Brazilian crisis also had a decisive effect on the slowdown in economic growth from 1998, which ultimately led to the Argentina crisis . The center-left government under Fernando de la Rúa , which replaced the Menem administration in 1999, changed the economic course only insignificantly; in particular the devaluation, which according to numerous experts should have taken place during this period, did not materialize.

Argentina crisis (2001/02)

In 2001 the situation in the Argentine economy began to deteriorate again. Economic growth had turned negative in 1999 and 2000, and national debt in particular became a challenge due to the appreciation of the Argentine peso, which was also driven by the strength of the US dollar, despite the fact that the IMF had given Argentina a large loan. Domingo Cavallo, reassigned to the office of Minister of Economics, first introduced a system of multiple exchange rates. For foreign trade, the peso was pegged not only to the US dollar but also to the euro , which at that time was well below the dollar's value. This made it possible to slightly lower export prices. Towards the end of 2001 there were plans to transfer this system to the internal value of the peso, which amounted to a - comparatively slight - devaluation. The crisis of confidence that ensued ultimately led to a wave of capital flight in November of that year, which brought the government into financial difficulties. As a result, a general cash restriction , known as the corralito, was issued, which allowed only limited amounts of money to be withdrawn from accounts. This led to storms of protest among the population and thus to the Cacerolazo on December 19th and 20th.

After De La Rua resigned and the transitional presidency of Adolfo Rodríguez Saá , who finally stopped paying foreign debts, was largely inconsequential , the new administration under Eduardo Duhalde devalued the peso to $ 1.40 per US dollar. There was a so-called official exchange rate, which only applied to government transactions, and another, "free", non-fixed rate that was adopted by the banks. However, this provisional measure caused the free dollar rate to rise inexorably due to the crisis of confidence and soon exceeded two pesos. Because of the failure of this measure, the official course was abolished. Was also abolished the corralito , but he was replaced by a far richer measure follow: the Corralón , converting all accounts above a certain value in fixed income securities, which should be returned only after a long delay. This measure led to a sharp decline in the consumption of long-lasting goods (e.g. automobiles).

Recovery (2002 to 2012)

From mid-2002 the effects of the devaluation began to take hold. The dollar rate was now around 3.50 pesos, which made Argentine products much cheaper on the world market, also because inflation, although it was high at 40% over the whole year, remained far below the rate of devaluation. This undervaluation boosted labor-intensive sectors of the economy, particularly services such as B. Call center and software industry . Areas with high import costs such as the computer hardware industry were initially severely disadvantaged. Due to the high inflation in the following years, however, this situation was slowly balanced out again. From 2003 onwards the economy recorded strong growth rates of between eight and nine percent, which (with the exception of 2009) continued until 2011.

New economic crisis (since 2012)

After 2012 there were several years of negative economic growth (2012, 2014, 2016, 2018). The already high inflation of around 8 to 10% annually (years 2008 to 2013) picked up again significantly from 2014 and stood at 34.3% in 2018. In September 2018, President Macri stated that he would not be able to service the debt in the short term. The government attempted to curb the subsequent capital flight by restricting foreign exchange trading for both large export companies and private individuals.

Social problems

The majority of Argentines today are affected by various manifestations of poverty . One has to distinguish between different approaches to describe poverty.

Income poverty

The low income is determined by the statistics office INDEC determined. This is based on a basket of goods that was determined in a survey in 1986 (the Encuesta de Ingresos y Gastos 1985/86 ) and that depicts the average food consumption of the second poorest quintile (fifth) of the population, i.e. those who live in the Percentiles between 21 and 40 in income are classified in relation to the total number of residents. From this basket, the Canasta Básica Alimentaria (basic food basket), the price is determined every year. Households that do not reach this value are called indigenous (for example: living in misery). In order to obtain the poverty rate, this value is multiplied by the inverted coefficient of Engel's law , which is calculated in Argentina with 2.07 and indicates how many times the basic food basket a household has to consume on average in order to obtain a basic supply in the existential areas (Housing costs, electricity, clothing, etc.). Households that fall below this income limit are considered poor .

Both indicators have shown very different values ​​in recent Argentine history. In the mid-1980s, for example, the poverty rate was below 20% and the misery rate below 10%. At the end of the decade, the poverty rate rose to almost 50% due to the hyperinflation crisis in 1989/90, only to fall well below 25% again as a result of the stabilization of the economy through the convertibility law . After 1995, however, the values ​​rose again until they reached a high of 57.5% in 2002 due to the inflation caused by the Argentina crisis and the associated loss of real wages.

The values ​​have been falling again since 2003, but the decline has slowed down again in recent years. According to values ​​from the second half of 2006, 26.9% of the population fell below the poverty line and 8.7% fell below the poverty line. Values ​​published thereafter (1st half of 2008: 17.8%) were, however, repeatedly questioned, since the manipulation of the consumer price index by the INDEC, which has been suspected several times, will also affect this rate from the beginning of 2007. In contrast, an independent estimate by the Institute for Regional Economic Development (IADER) in December 2008 came to a value of 31.5%.

Income poverty values ​​vary from region to region. It is only measured by the INDEC in the metropolitan areas of Argentina, the values ​​in the rural areas are not recorded. In the 2006 measurement, the value in the Resistencia agglomeration was highest at 48.9, followed by Corrientes (46%), Santiago del Estero (44.2%), Formosa (43.7%) and Posadas (43.6 %) %). The largest metropolitan area, Gran Buenos Aires , still achieved an average value of 25.5%. The agglomerations with the lowest values ​​were Río Gallegos (5.8%), Ushuaia / Río Grande (7.6%) and Comodoro Rivadavia (10.6%). In terms of the poverty rate, the ranking is almost identical, with Resistencia also achieving the highest value with 19% and Río Gallegos the lowest with 0.8%. The south-north divide that affects the entire economy of Argentina is also evident here.

Living situation

The housing situation in Argentina is improving continuously, but it is far from being satisfactorily solved for a country with this economic power. On the one hand, a large part of the rural population still live in poorly equipped huts, on the other hand, extensive slums and informal settlements , the so-called villas miseria, have formed around the large and medium - sized cities since the 1940s .

In 2001, 78.1% of all dwellings were in categories classified as liveable by the INDEC. This includes houses and apartments. The remaining 21.9% are distributed among houses with serious deficiencies (called by INDEC B-houses , which either have unpaved floors or no water connection or no water-flushed toilet), traditional country huts ( ranchos ) and makeshift small dwellings ( casillas ) as they are before Typical for slums are tenements, boarding houses, non-residential premises and mobile housing. This is an improvement on 1980 (71.1% livable housing) and 1991 (75.1%). Because of the numerous construction and urbanization programs after the 2001/02 economic crisis, it can be assumed that the situation has further improved overall, even if no official statistics exist yet.

However, this cannot hide the fact that, to the same extent as other economic indicators, there are extreme inequalities between the various regions and provinces of Argentina. In the city of Buenos Aires, 94% of all dwellings are classified as livable, and the conditions are significantly better than in the best-off provinces of La Pampa (90.7%), Santa Cruz (87%) and Córdoba (86%) on average. At the other extreme are the provinces of Formosa (41.2%), Santiago del Estero (45.9%) and Chaco (49%), in which only a minority of the dwellings can be classified as livable.

Among the building programs that try to improve this situation, the most important ones are the PROMEBA urbanization program (Programa de Mejoramiento de Barrios, Spanish for neighborhood improvement program ) and the Federal program of Vivienda . While the Promeba is based on existing living spaces in slums and their dwellings - which mostly belong to the "B-house" and "Casilla" type - are expanded to include the necessary infrastructure (toilet, water and electricity connections) and the material required to improve the building fabric, The Programa Federal de Viviendas relies on the completely new construction of the apartments, whereby there are various solutions, of which the basic type is given free of charge and the larger houses, which are aimed at the working and lower middle classes, are paid for by the residents through a state-subsidized financing plan become.

Distribution of economic power among the provinces

The economic power of the provinces of Argentina is characterized by great regional inequality. However, since 2001 there are no more official data from INDEC for the distribution. Investigations in 2006 by the Institute for Regional Economic Development in Argentina and an annual estimate calculated by the private economic institution abeceb indicate a disparity in the gross national product of more than a factor of 10; in the estimate for 2008, the province of Santa Cruz as the best-placed region had a nominal value of US $ 30,400 per capita comparable to New Zealand , while the value for Chaco was 2,000 (comparable to Sri Lanka ).

province GNP 2006 in million pesos
(1993 prices) 		GNP per capita 2006
(peso, 1993 prices) 		GDP per capita 2008
( US dollars , estimate)
Buenos Aires (city) 84,743 28.007 23,300
Buenos Aires 107,644 7,540 7,300
Catamarca 1,728 4,652 6,000
Chaco 4,397 4,168 2,000
Chubut 4,652 10,483 15,400
Cordoba 27,740 8,660 6,400
Corrientes 4,230 4,242 4,000
Entre Ríos 7,771 6,369 5,600
Formosa 2,082 3,899 2,800
Jujuy 2,998 4,525 3,700
La Pampa 3,144 9,851 5,900
La Rioja 1,822 5,556 4,100
Mendoza 13,784 8,309 9,000
Misiones 4,770 4,499 3,100
Neuquén 6,973 13,273 28,000
Río Negro 5,420 9,368 8,200
Salta 5.141 4,314 4,200
San Juan 3,613 5,454 5,600
San Luis 3,386 8,216 5,500
Santa Cruz 3,260 14,995 30,400
Santa Fe 27,000 8,740 8,400
Santiago del Estero 2,863 3,304 3,000
Tierra del Fuego 2,600 21,060 20,600
Tucuman 7,234 5,050 3,900

The details and reasons for the uneven distribution are discussed below.

Buenos Aires special case

The high gross national product of the city of Buenos Aires is due to a special situation. The federal district comprises only about a quarter of the population of the Gran Buenos Aires metropolitan area (3 in about 12 million), but a large number of companies are based in this district. In terms of the standard of living of the population, the federal district mainly comprises residential areas of middle and upper classes. Hence the high value for the city is not surprising. If you add the values ​​of the city of Buenos Aires with those of the metropolitan area, you arrive at a GDP per capita that is only slightly above average for Argentina.

The rich southern provinces

The provinces of the Patagonia Argentina region , particularly Tierra del Fuego and Santa Cruz , and to a lesser extent Neuquén , Chubut , La Pampa and Río Negro , have very low population densities. However, with the exception of Tierra del Fuego, they are very resource-rich. This includes in particular oil and gas production and energy production. This also favored the settlement of industry and trade. One consequence of the good situation is high population growth due to internal migration, with the exception of Río Negro and La Pampa, whose growth is average.

In Tierra del Fuego, on the other hand, the high economic power has another reason. In order to promote the settlement of the area, which was almost uninhabited until around 1970, the province - at that time still a national territory - was declared a duty-free zone, and there were also tax incentives for the settlement of industries. Among other things, this led to the fact that Río Grande became the center of the Argentine electronics industry. In addition, because of its great distance from the economic center of the country, the province has a price level that is far above average, which also pushes up wages and thus the value of the gross national product.

Backlog of the northern provinces

As a homogeneous bloc, the provinces of northern Argentina take the last places in terms of economic power. A 2005 study by the United Nations found that this backwardness is primarily due to structural reasons. With the exception of a few isolated centers such as San Miguel de Tucumán and Salta, the economy is not very diversified. Numerous industries are lacking for dynamic development, so that only limited economic clusters (systems of interdependencies between several companies) are formed. This strongly inhibits the development of the regional economy.

literature

  • Klaus Bodemer: Argentina today: Politics, Economy, Culture , Vervuert Verlag, Frankfurt am Main 2002, ISBN 3-89354-588-3
  • José A. Friedl Zapata: Argentina: Nature - Society - History - Culture - Economy , Erdmann Verlag, Tübingen / Basel 1978, ISBN 3-7711-0307-X

Web links

Individual evidence

  1. ↑ Gross domestic product 2016 (PPP) (PDF; 14 kB) In: The World Bank: World Development Indicators database . World Bank. February 3, 2017. Retrieved February 5, 2018.
  2. ↑ [1] Retrieved January 29, 2018
  3. ↑ [2] Retrieved July 4, 2019.
  4. ↑ [3] Retrieved July 4, 2019.
  5. ↑ [4] Retrieved January 29, 2018
  6. ↑ [5] Retrieved January 29, 2018
  7. ↑ [6] Retrieved January 29, 2018
  8. ↑ [7]
  9. ↑ [8] Retrieved January 29, 2018
  10. ↑ [9] Retrieved January 29, 2018
  11. ↑ [10] Retrieved January 29, 2018
  12. ↑ At a Glance: Global Competitiveness Index 2017–2018 Rankings . In: Global Competitiveness Index 2017-2018 . ( weforum.org [accessed December 22, 2017]).
  13. ↑ Country Rankings: World & Global Economy Rankings on Economic Freedom. Retrieved December 22, 2017 .
  14. ↑ Country profile of Argentina ( Memento of May 13, 2008 in the Internet Archive ) of the World Bank
  15. ↑ Mining statistics ( MS Excel ; 19 kB) from INDEC , 2003
  16. ↑ ABA bank ranking September 2006 ( Memento from June 9, 2007 in the Internet Archive )
  17. ^ Instituto Argentino para el Desarrollo de las Economías Regionales ( Memento of July 1, 2007 in the Internet Archive )
  18. ↑ Source: Scavage import statistics
  19. ↑ Source: Scavage export statistics
  20. ↑ a b c d e f José A. Friedl Zapata: Argentina, p. 340 ff.
  21. ↑ CIA World Factbook
  22. ↑ Statistical information sheets ( Memento of July 29, 2007 in the Internet Archive ) of the Secretaría de Energía de la Nación
  23. ↑ Source: INVAP
  24. ↑ Sections up to here based on The Economic Development Process , in: José A. Friedl Zapata: Argentina (Ländermonographie), 1978, pp. 339–353
  25. ↑ GDP growth (annual%) | Data. Retrieved July 4, 2019 .
  26. ↑ Argentina - inflation rate up to 2018 | Statistics. Retrieved July 4, 2019 .
  27. ↑ Holger Zschäpitz: peso collapse: Argentina threatens the ninth national bankruptcy . September 3, 2019 ( welt.de [accessed September 3, 2019]).
  28. ↑ Source: Acerca del método utilizado para la medición de la pobreza en Argentina ( Memento of November 24, 2007 in the Internet Archive ) (PDF; 140 kB) , INDEC, May 2003, official document for calculating the poverty line
  29. ↑ La pobreza en las provincias se acerca a 50% de la población  ( Page no longer available , search in web archives )  Info: The link was automatically marked as defective. Please check the link according to the instructions and then remove this notice. , Publication of the Instituto Argentino para el Desarrollo de las Economías Regionales@1@ 2Template: Dead Link / www.iader.org.ar  
  30. ↑ Data: Information sheet from the Ministry of Social Affairs on poverty ( Memento from September 29, 2007 in the Internet Archive ) (PDF)
  31. ^ Page of the Promeba ( Memento of May 13, 2013 in the Internet Archive )
  32. ↑ a b The data are taken from the following list: Article in Misiones Online about the study ( Memento from September 28, 2007 in the Internet Archive )
  33. ↑ Para las provincias, la distribución de la riqueza no varía desde 2002. Estimate of the Región del Norte Grande Argentino based on data from abeceb, September 12, 2008, accessed on March 17, 2009 .
  34. ↑ Informe de Desarrollo Humano 2005 - Report on the development status of Argentina ( Memento of March 3, 2006 in the Internet Archive )