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The crude x-ray of the 'curse of the Argentine economy' of the newspaper El País

2021-02-28T21:04:19.834Z

The Spanish media emphasizes that the country has the greatest debt with the IMF and suffered one of the worst contractions due to the pandemic in America. "The crises return because they never left," analysts say.



02/28/2021 17:43

  • Clarín.com

  • Economy

Updated 02/28/2021 5:43 PM

That it is the main debtor of the International Monetary Fund and that it suffers one of the

most serious

contractions

in America

due to the pandemic

.

That the currency continues to devalue, that inflation is very high and that

four out of ten citizens live in poverty.

This is how crude the reality is that, according to the newspaper El País de España, lives in Argentina.

The text published this Sunday speaks of a catastrophe in economic matters and states that the situation in general is very alarming.

The article reviews part of Argentine history and how the different stages and decisions that led the country to the moment it is today were happening.

In 1921 it was one of the richest countries in the world, its GDP per capita was equivalent to that of France or Germany at that time.

However, it experienced an annual inflation of 105% and

changed its currency up to 5 times

: peso national currency until 1969, peso ley until 1983, Argentine peso until 1985, austral until 1991 and the current peso.

Since 1980, it has

suspended payments on its foreign debt five times

(no country in the world equals that mark) and is currently the main debtor of the International Monetary Fund,

with 44,000 million dollars.

The note highlights that in 2019, when Alberto Fernández became president, things were already bad, the country had fallen into default and had been in recession for three years.

Martín Guzmán, current Minister of Economy, "had to reorganize the debt with creditors, while

juggling to solve the negative effects of the pandemic

.

"

The former managed to get it out by far,

"it achieved a sensible reduction in interest and extended the maturity of payments."


However, and while the pandemic progressed, Argentina had to solve the brake on the economy without being able to ask anyone for a dollar.

The Central Bank issued more than 1.2 trillion pesos with the risk that inflation would worsen, something that began to be seen last January with increases

of 4%.

But while Fernández blamed the previous government for the current crisis ("during 2018 the peso lost 40% of its value and the huge loan received from the IMF evaporated in desperate coverage of the fiscal deficit and in speculative operations),

he said the same

Mauricio Macri

when he came to power

, with the inheritance of serious problems.

In this way, the Spanish newspaper explains that Argentina

"never managed to get out of its crisis."

Diego Sánchez-Ancochea, professor of Political Economy for Development at the University of Oxford, analyzes it: "Spaces of tranquility are created, but structural problems are never resolved.

Crises return because they never left."

The trauma of the "corralito" of 2001 still could not be overcome and that this generated a bimonetary country.

It exemplifies that the prices of the real estate market are in dollars.

The article also cites an interview conducted by

Clarín with

the economist Martín Rapetti, who estimates that, in real terms, the gross product per inhabitant in Argentina is almost the same today as in 1974. With the aggravating factor that the inequality between the rich and the poor is

much higher

.

Almost half a century lost.

Ripetti makes a grim forecast

: counting on the Argentine economy to grow 6% in 2021 and then continue to grow at an uninterrupted rate of 4.5% per year,

Rather unlikely,

the 2011 standard of living will not rebound until 2027.


Look also

Inflation is as out of control as vaccines

Alberto Fernández prepares a speech focused on the economy and Justice and messages for the opposition

Source: clarin

All business articles on 2021-02-28

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