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DEBT, CRISIS, AND FORGIVENESS Argentina

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Basic Information Created in 1816 Population: 43,024,374 (july 2014 est) Ethnic Groups: White (mostly Spanish and Italian) 97%, Mestizo (mixed White and Amerindian ancestry), Amerindian, or non-white groups 3% Literacy (age 10 and over can read and write) 97.9% Male: 97.9% Female: 98% Religious Groups: Roman Catholic 92% (less than 20% practicing) Protestant 2% Jewish 2% Other 4% Source: CIA World Fact Book

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Political Background (1943-1946) Military Regime (1951-1955) Personalist Regime (1955-1958) Military Regime (1958-1966) Indirect Military Regime (1966-1973) Military Regime (1976-1983) Military Regime Source: Geddes, Wright, Frantz

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Political Background Continued Regime Democracy as of 2000 Stability Stable democracy since 1991 Capacity Moderate Source: Polity IV, The State of the State

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Economy GDP per capita: $22,100 (2014 est.) Industries Food processing Motor vehicles Consumer durables Textiles Chemicals and petrochemicals Printing Metallurgy steel Source: CIA World Factbook

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Foreign Aid Debt: $115.7 billion Foreign aid received in 2010 was $121,120,000 Source: CIA World Factbook, Salmon

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Declining Stability The Great Depression Exports dropped 40% Inflation increased The military junta 1930 President Vrigoyen becomes scapegoat, violence, political instability End of Democracy in Argentina Conservative economic policies and state intervention in economic policies Source: Scraping Through the Great Depression

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Import Substitution Industrialization Promotion industrialization from based on national production Government took over the provision of public utilities and production in industries that were considered strategiciron, oil, and petrochemical products Diverted investment from agricultural production Source: Bebczuk, Gasparini

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The End to Import Substitution, The Beginning of Inflation The failure of ISI lead to commercial and financial openness (manufactures in total exports rose from 4% to 23% (Waterbury, 335) Led to the 1980 Financial crisis in Argentina Source: Waterbury, Balino & Sundararajan, Cooney

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International Monetary Fund Initially turned down Argentina in 1982 Erecting barriers for less developed countries (Scott) In 1984 the IMF reached an agreement with Argentina Source: Balino, Sundararajan, Easterly

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PrivatizationInequality In 1991, the need to eliminate inflation led the government to: Privatize most things government owned Renew fiscal and monetary order Commercial and financial opening Deregulate of private activity Source:ebczuk, Gasparini

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The Argentine Economic Crisis The fixed exchange rate between the Argentine peso and the US dollar. Large amounts of borrowing from the IMF by former presidents Increase in debt due to reduced tax revenue Source: Katel

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Recovery Argentina left the fixed exchange rate 1 Argentine peso=1 US dollar 2002: 4 Argentine pesos=1 US dollar Source: Pettinger

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Pros and Cons of Devaluation Pros Increase in export demand (helped by rise in price of soy) Forced people to buy less imports and more domestically produced goods Cons Big fall in standard of living Still inflation since devaluation Most savings were lost Argentina has a bad reputation for borrowing Source: Pettinger

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Bibliography Balino, Tomas J. Sundararajan, Vasudevan. Banking Crises: Cases and Issues. Print. Bebczuk, Ricardo, and Leonardo Gasparini. "Globalisation and Inequality. The Case of Argentina." Www.econo.unlp.edu.ar/depecoGlobalisation and Inequality The Case of Argentina * (n.d.): n. pag. Web CIA World Factbook-https://www.cia.gov/library/publications/the-world-factbook/geos/ar.htmlhttps://www.cia.gov/library/publications/the-world-factbook/geos/ar.html Cooney, Paul. "Argentinas Quarter Century Experiment with Neoliberalism: From Dictatorship to Depression." Scielo. N.p., n.d. Web. Geddes, Barbara, Joseph Wright, and Erica Frantz. Autocratic Regimes Code Book Version 1.2. N.p.: n.p., n.d. Web. Easterly, William. The Elusive Quest for Growth. N.p.: n.p., n.d. Print. Katel, Perter. "Argentin's Crisis Explained." Time. N.p., 20 Dec. 2001. Web.. Pettinger, Tejvan. "Argentina Crisis and Recovery." Economics Help. N.p., 18 June 2012. Web. 19 May 2015.. Salmon, Felix. "Welcoming Argentina Back." Web log post. Reuters. N.p., 5 Nov. 2010. Web. "Scraping through the Great Depression." The Economist. The Economist Newspaper, 01 June 2002. Web. 19 May 2015. The Polity IV website http://www.systemicpeace.org/polity/polity4x.htm --7http://www.systemicpeace.org/polity/polity4x.htm --7 "The State of The State." The Economist. N.p., 22 Nov. 2010. Web. Waterbury, John. "The Long Gestation and Brief Triumph of Import-Substituting Industrialization." World Development 27.2 (1999): 323-41. Web.