Draft:Argentine economic crisis (2011-current)
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Last edited by Cambalachero (talk | contribs) 32 days ago. (Update) |
Argentina has faced an ongoing economic crisis since 2011. It has endured through the governments of Cristina Fernández de Kirchner, Mauricio Macri, Alberto Fernández, and Javier Milei.
Characteristics
[edit]Argentina has a fiscal deficit of 15% of its Gross domestic product (GDP).
Argentina is a tax hell, the second country in the world with the highest tax pressure.
The country faced several periods of sovereign default, including the longest one from 2002 to 2016. Although Argentina is not in default as of 2024, it has low credibility and a high country risk.
The high money emissions used to pay the fiscal deficit have caused huge inflation, which ended at 211,4% for the year 2023.[1] This was the highest inflation rate in the world.[1]
History
[edit]In the 1990s, fiscal deficit was not allowed by the Convertibility plan, which ended the problem of inflation. The country still had deficit, but paid it with sovereign debt. The 2001 economic crisis ended with the repeal of the convertibility plan, but the country recovered a short time later thanks to a boom in the international price of soybean.
The international price of soybean fell in 2011, during the second term of Cristina Fernández de Kirchner, which shrank the revenues in Argentine trade, but the spendings were kept the same, which led to a fiscal deficit. Inflation began to grow to big numbers. Mauricio Macri, elected in 2015, sought to gradually reduce the deficit, but the effect was minimal and inflation remained. Peronism returned in 2019 with Alberto Fernández, who undid the economic policies of Macri, and inflation skyrocketed. Javier Milei, elected in 2023, sought to implement a stricter austerity plan.
References
[edit]- ^ a b Melisa Reinhold (February 14, 2024). "La Argentina arrancó el año con la inflación más alta del mundo" [Argentina started the year with the highest inflation of the world] (in Spanish). La Nación. Retrieved February 14, 2024.