Argentina is a country with an economy that has gone from good to one described as struggling. This transition is due to the inability to accurately identify the cause of the country's economic decline. Before WWI, Argentina's GDP was growing at the rate of 6% annually. It was one of the fastest growing economies in the world. Europeans and other immigrants fancied Argentina for jobs mostly the commodities and labor sectors. It was ahead of Germany, France, and most of its neighbors. Its income per head was high, about 92%. Now, it is behind most of the countries it once was ahead regarding economic growth. Political and socioeconomic factors have contributed to the decline in Argentina's economy.
Argentina's economic performance has been described as a pendulum because of the inconsistency in government and policies. This inconsistency is primarily due to political and unstable systems. Protective policies and debt have contributed in crippling an economy with human and natural resources (Jacobs, 2003). Political corruption has affected Argentina’s economic status (Roberts and Margulies, 2016). Institutional ineptitude and anti-free trade policies are factors within the country that are stagnating the economic growth. Debowicz and Segal (2014) notes, “The competing interests of the agricultural and industrial sectors in Argentina have been a source of political conflict and economic instability since early in the twentieth century.” (p.248). Thus, reforms in policy and political will are critical in changing the economy.
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Different governments have tried implementing and restructuring the economic agendas and policies that will bring Argentina from the point of stagnation. Government interference in markets and trades are steps that have hindered progress in this direction (Roberts and Margulies). The decline is the result of market uncertainties and abuse of the rule of law. The presidency of Juan Peron placed Argentina on the path of economic woes and introduced the management of financial institutions;Kirchner perfected it (Alejandro, 2013). Argentina’s economy will recover by restructuring and political will to implement global open trade policies.
References
Alejandro A. C. (2013). “Don’t Cry for Me, America: Comparing Argentina and the United States,” Center for Vision and Values. Retrieved from http://www.visionandvalues.org/2013/06/dont-cry-for-me-america-comparing-argentina-and-the-united-states/
Debowicz, D. & Segal, P. (2014). Structural Change in Argentina, 1935–1960: The Role of Import Substitution and Factor Endowments. The Journal of Economic History, 74(01), 230-258.
Jacobs, B. L. (2003). “Pesification and Economic Crisis in Argentina: The Moral Hazard Posed by a Politicized Supreme Court,” University of Miami Inter-American Law Review, Vol. 7, No. 1 . pp. 398–399. Retrieved from http://repository.law.miami.edu/cgi/viewcontent.cgi?article=1196&context=umialr
Robert, J. & Margulies, G. (2016). How Economic Freedom Can Be Restored in Argentina. Retrieved from http://www.heritage.org/international-economies/report/how-economic-freedom-can-be-restored-argentina
