Argentina: Key Facts

  • Argentina’s economy has undergone massive fluctuations in recent decades.
  • By the 1920s, Argentina was one of the world’s wealthiest countries.
  • However, the country’s economy has suffered from a series of shocks over the past century.
  • Argentina has one of the world’s largest agricultural industries and agricultural exports are a key element of the economy.
  • Argentina plays a leading role in regional politics, but has seen its role reduced, due largely to the country’s economic struggles.

Key Facts and Data:

  • Official Name – Argentine Republic
  • Capital – Buenos Aires
  • Government Type – Republic
  • Head of State and Government – President Mauricio Macri (since 2015)
  • Population – 43,887,000
  • Land Area – 2,736,690 sq. km • Total GDP (US$) – $542 billion
  • Per Capita GDP at PPP (US$) – $20,972
  • Currency – Argentine peso

Current Events:

  • Recent Political Events
  • Recent Economic Events
  • Other Recent Events

Political Outlook:

  • Overview of the Current Government
  • Leadership Profile
  • Summary of the Most Recent Elections
  • Leading Political Parties
  • Forecast for the Next Elections
  • International Relations Outlook
  • Potential Conflicts
  • Military Capabilities
  • Key Political Issues
  • Political Risk Outlook

Economic Outlook:

  • Economic Overview
  • GDP Growth Forecasts
  • Key Sector Forecasts
  • Inflation Forecasts
  • Foreign Trade Forecasts
  • Foreign Investment Forecasts
  • Exchange Rate Forecasts
  • Outlook for Key Sector
  • Key Economic Issues
  • Economic Risk Outlook

Political Outlook:

  • Overview of the Current Government
  • Leadership Profile
  • Summary of the Most Recent Elections
  • Leading Political Parties
  • Forecast for the Next Elections
  • International Relations Outlook
  • Potential Conflicts
  • Military Capabilities
  • Key Political Issues
  • Political Risk Outlook

Demographic & Environmental Outlook:

  • Population Overview
  • Population Characteristics
  • Development of Leading Urban Centers
  • Key Demographic Issue
  • Topography and Climate Overview
  • Environmental Threat Summary
  • Key Environmental Issues
  • Demographic and Environmental Risk Outlook

Current Events and Recent Changes Overview

Key Political Events and Changes:

  • President Macri and his center-right “Let’s Change” coalition government were given a major boost when they emerged as the big winners from late 2017’s parliamentary elections. President Macri’s coalition won control of 13 of the 23 provincial governments, including all of the country’s most populous regions.
  • The disappearance of the indigenous rights champion Santiago Maldonado after a protest in southern Argentina caused a major scandal in recent months. His dead body was discovered in late 2017.
  • In December 2017, a judge ruled that the Argentine prosecutor Alberto Nisman was killed shortly before he was to testify against former President Cristina Fernandez de Kirchner in January 2015.
  • Former Vice President Amado Boudou was arrested on charges of corruption in late 2017. He is the latest member of former President Cristina Fernandez de Kirchner’s government to be arrested recently on corruption charges.
  • In December 2017, a judge announced that he was seeking the arrest of former President Fernandez.

Argentina: Recent Economic Events and Changes

Key Economic Events and Changes:

  • Argentina’s economy expanded by 4.2% on a year-on-year basis in the third quarter of 2017. Increases in capital expenditures and consumer spending were the drivers of this growth.
  • President Macri announced that he intends to pursue major reforms for Argentina’s taxation, labor and retirement systems. This followed the crushing victory of his “Let’s Change” coalition in late 2017’s midterm elections.
  • Argentina’s inflation rate rose sharply to 25.0% year-on-year in December 2017.
  • The country’s central bank cut interest rates by 75 basis points to 28.0% in January 2018.
  • Argentina’s unemployment rate fell to 8.3% in the third quarter of this year.
  • Labor unions staged a series of major protests in December 2017 against the government’s economic and pension reforms that were passed by the parliament that month.

Other Key Events and Changes:

  • An Argentine submarine went missing in the South Atlantic in November 2017. After an international search, it was assumed that the 44-person crew was dead.
  • In January 2018, the Congress ordered a commission to be created to investigate the disappearance of the Argentine sub late last year

Argentina Political Outlook


Argentina: Current Government

  • A new center-right government took office in December 2015 when Mauricio Macri was sworn in as president of Argentina.
  • In December 2016, President Macri carried out his first cabinet reshuffle. The main move was his sacking of Finance Minister Alfonso Prat-Gay due to internal disputes within the administration’s economic team. He spilt that position into two positions, a finance minister and a treasury minister.

Key Members of the Government:

  • Head of State and Government – President Mauricio Macri
  • Vice President – Gabriella Michetti
  • Cabinet Chief – Marcos Pena
  • Minister of Foreign Affairs – Susana Malcorra
  • Minister of Finance – Luis Capato
  • Minister of the Interior – Rogelio Frigerio
  • Minister of Justice – German Garavano
  • Minister of Defense – Julio Martinez
  • Minister of Security – Patricia Bullrich
  • Minister of Agriculture – Ricardo Buryaile

Profile of President Mauricio Macri


Mauricio Macri became the president of Argentina following his surprise victory in 2015’s presidential election.

  • He was born into a wealthy family in Buenos Aires and worked for a time at a construction company owned by his father.
  • He first rose to prominence as the president of the popular Boca Juniors football (soccer) club in Buenos Aires in the 1990s.
  • In 2005, he founded the center-right Republican Proposal (PRO) party and in 2007, he was elected as the mayor of Buenos Aires.

Key Policies and Stances:

President Macri moved quickly to reverse many of the policies that had been put in place during the 12 years of Kirchner rule in Argentina.

  • For example, he moved to improve ties with the United States and with Latin American countries with more open economic systems, such as Mexico, Colombia and Chile.
  • He also moved to remove currency controls and to restore the independence of the country’s monetary and statistical agencies

Argentina: Most Recent Elections Presidential Election – October and November 2015

Summary of the Last Elections:

Mauricio Macri won a surprising victory in late 2015’s presidential election, overtaking the chosen candidate of outgoing President Cristina Fernandez de Kirchner, Daniel Scioli, in the final weeks of the election campaign.

  • While Mr. Scioli was able to win the largest share of the vote in the first round of voting, he failed to win the election outright and his lead over Mr. Macri was much smaller than had been expected.
  • In the second round of voting, Mr. Macri was able to gain a majority of the supporters of the third place finished in the first round, Sergio Massa, enabling him to win a narrow victory of Mr. Scioli.

Argentina’s worsening economic situation allowed Mauricio Macri to win the 2015 presidential election.

  • Economic growth rates had fallen sharply in the years before the election and inflationary pressures were dangerously high at the time of the election.
  • Mr. Macri campaigned on a platform of economic reform and of restoring the independence of the country’s economic and monetary institutions.

Argentina: International Relations Outlook

Key International Disputes:

  • The Falkland Islands dispute is Argentina’s only major territorial dispute at present.
  • Mercosur, which also includes Brazil, Uruguay and Paraguay, has led to a major improvement in relations between Argentina and its neighbors.
  • However, in recent years, relations have been strained with both Chile and Uruguay.

International Relations Outlook:

  • Argentina will continue to push for closer regional integration so long as there is not another economic collapse.
  • Meanwhile, Argentina will continue to fear growing Brazilian influence in the region.

Potential Conflict: Falkland Islands (Malvinas)

Main Disputes:

  • Argentina invaded the islands in 1982, but the islands were retaken by Britain later that year.
  • The islands were originally disputed by Britain and Spain in the 18th and 19th centuries.
  • The inhabitants of the islands have consistently rejected closer ties with Argentina since the 1982 war.

Best- and Worst-Case Scenarios:

  • Best Case Scenario – Relations between the islands and Argentina improve, allowing for closer ties that satisfy both parties.
  • Worst-Case Scenario – Argentina makes another move for the islands at some point in the future, threatening another war between the UK and Argentina.

Military Spending

Strengths and Weaknesses

The Argentine military has lost much of its influence and power since its defeat in the Falklands War in 1982.

  • The military government was removed from power in 1983 and the armed forces have been marginalized since then.

Today, Argentina’s military capabilities remain relatively limited.

 Even by South American standards, its military power is minimal.

  • For example, Argentina has little ability to project power outside of its borders.
  • Given the lack of immediate threats and the poor economic situation, there is little chance for a major increase in military spending.


Argentina’s military forces are more likely to be used today in international peacekeeping missions than anything else. 

  • With relations with Chile having drastically improved and nearly no chance of more adventurism in the South Atlantic, Argentina’s military will remain limited in terms of global power.

Argentina: Political Risk Outlook

  • Despite the economic upheavals of the past 20 years and the fluid nature of Argentine politics, political risk levels remain quite low by regional standards.
  • For these risk levels to remain low, economic growth is needed to restore the public’s confidence in the government.

Argentina: Economic Overview

Economic Summary:

Argentina’s economy has endured a great deal of volatility in recent decades.

  • Once one of the world’s richest countries, Argentina today is a middle-income country.
  • Low commodity and agricultural prices, coupled with the loss of export markets led to the country’s economic decline, although both have rebounded in recent years as export demand has grown.

Argentina’s economy has long been based on its wealth of natural resources.

 Argentina has substantial mineral resources.

  • Moreover, the country’s is one of the world’s leading exporters of agricultural products.

Argentina’s recent economic downturn continues to threaten to undermine the country’s increasingly fragile economy. 

  • The latest crisis is threatening Argentina with hyperinflation that could lead to another deep recession unless the government takes steps to improve the country’s economic situation.

Key Wealth-Related Issues and Trends

Argentina was for the best part of the past 150 years the wealthiest country in Latin America.

However, its advantage its neighbors has shrunk and Chile has recently overtaken Argentina in terms of per capita GDP.

Poverty is a growing problem in Argentina, increased by the recent economic troubles.

As late as the 1930s, Argentina was one of the world’s richest countries.  However, a loss of export markets, coupled with economic mismanagement, have left Argentina far behind the world’s developed countries in terms of wealth levels.

The last economic crisis completely disrupted Argentina’s social class structure and reduced a large section of the population to poverty.  In fact, the total number of people living in poverty grew by more than 500% over the past 15 years and is only now beginning to fall as Argentina’s economic recovery continues.

The economic recovery must reach all segments of Argentine society in order to prevent a further increase in crime and corruption.  To do this, jobs must be created and it will be foreign investments and exports that provide for this job creation.

Argentina: GDP Growth Outlook

Current Outlook:

  • Argentina has experienced wild fluctuations in economic growth over the past decade.
  • In recent years, growth has slowed sharply once again as dangerously high inflationary pressures have weakened domestic demand.

Future Outlook:

  • GDP growth will be weak at best over the nearterm as export demand remains weak and high inflation curbs domestic demand growth.
  • Moreover, Argentina’s economic imbalances could result in much lower rates of economic growth later in the forecast period.

Argentina: Key Economic Sector Agriculture


Argentina has one of the world’s largest export -oriented agricultural sectors.

  • Beef, sheep, soya and grains are exported throughout the world.
  • Argentina competes with the United States, Canada and Australia in each of these sectors.

Argentina is one of the world’s leading exporters of beef.

  • Demand for Argentine beef exports continues to rise, but climatic conditions in Argentina have led to an uneven performance for the sector in recent years.
  • Furthermore, competition from Brazil has had a major impact on Argentina’s beef exports.


Argentina’s agricultural sector has withstood the recent economic crisis better than most and is set to grow as export potential expands. 

  • However, the struggles of the country’s beef sector highlight the threat of competition from Brazil and other major agricultural sectors.

Argentina: Key Economic Sector Manufacturing


Argentina has South America’s second-largest manufacturing sector, after Brazil.

  • Food processing and textiles were traditionally the main sectors.
  • However, steel, automobiles and other heavy industry sectors have expanded in recent decades.

The manufacturing sector suffered from the collapse of the domestic market during the previous economic crisis.

  • However, lower production costs have allowed the sector to rebound in recent years thanks to higher export levels.


Like the agricultural sector, Argentine manufacturing has the potential to enjoy significant export growth. 

  • However, Argentina will have to compete with numerous other candidates for export-oriented foreign investment, such as China, South Africa, Brazil and Mexico.
  • Argentina’s skilled labor force could prove to be a critical advantage.

Argentina: Industrial Production Growth Outlook

Current Outlook:

  • Industrial production growth rates trended downwards in recent years, with export demand weakening during this period, leading to lower levels of industrial production.

Future Outlook:

  • Argentine industries will continue to struggle in the coming years as they attempt to compete with international competitors.
  • This competition from China, Brazil and Mexico will make it difficult for Argentine manufactured exports to gain access to key export markets.

Manufacturing Location Rankings by in Latin America

Current Situation:

  • With the exception of Mexico, Latin American countries have struggled to develop major manufacturing industries that continue to expand in the 21st century.
  • A key problem facing the region is export competitiveness, due to poor infrastructures and a lack of access to key export markets.

Future Situation:

  • Latin America’s recent economic woes have stunted domestic market growth in the region, and this has hurt many of the region’s main manufacturing industries.
  • Moreover, with the exception of Mexico, it is unlikely that the region will be able to develop competitive export-oriented manufacturing industries in the coming years.

Argentina’s retail sector grew at a strong pace in recent years, but the country’s current economic woes have badly impacted consumer confidence in Argentina.  Meanwhile, Argentine consumers remain among the wealthiest in Latin America, although they have lost ground to their counterparts in most other large emerging markets.

Argentina: Inflation Outlook

Current Outlook:

  • Inflation remained high in recent years due in large part to higher levels of consumer spending that have been fuelled by the growth of the money supply as well as the sharp rise in food and energy prices.
  • Moreover, the previous government had been under-reporting inflation rates in recent years, with actual inflation rates likely being as much as three times above reported levels.

Future Outlook:

  • Inflationary pressures will remain dangerously high over the near-term before easing later in the forecast period.

Argentina: Foreign Trade Overview

Export growth fell significantly in recent years as both manufactured and agricultural exports have fallen from their earlier highs.  Unless Argentina can improve its export competitiveness, it will continue to struggle to compete with key exporting emerging markets such as China or Mexico.

Foreign Investment Climate:

Argentina continues to fail to attract significant amounts of foreign investment.

  • While the domestic market will remain weak over the coming years, export opportunities abound.
  • The mining and agricultural sectors have attracted more investment.

Many companies are still wary of investing in Argentina.

  • The labor market remains volatile, deterring investment in the manufacturing sector.
  • The government’s call for more state involvement in the economy is also worrying to many potential investors.

Outlook For Future Foreign Investment:

Foreign investment levels are not forecast to rise significantly due to the economic slowdown and the lack of economic reform in Argentina.

  • Moreover, Argentina will have to compete with China and others for export-oriented foreign investment.
  • In order to do so, it will need to have full government support for investment incentive programs.

Argentina: Labor Force

Labor Force Overview:

Argentina’s unemployment rates have fallen from their post-crisis highs in the previous decade. • Unemployment rates are not as high as in earlier years, but the number of long-term unemployed remains very high.

Argentina has one of the most skilled and educated workforces in the Americas.

  • This, combined with the weaker peso, will be a major draw for foreign investors in the export sector.

Argentina has one of the most expensive work forces in South America.

  • This, combined with the strength of the country’s labor unions, has deterred some foreign investment in Argentina.

Outlook For the Labor Force:

Unemployment rates are forecast to remain relatively high in the coming years. • Moreover, long-term unemployment will remain a major problem in the country and could lead to political unrest in the years ahead

Fiscal Policy Overview

Current Outlook:

  • By forcing a settlement of its massive debts, the Argentine government allowed the country to avoid huge fiscal deficits that could have occurred after the recent economic crash.
  • However, 2014’s default helped to lead to a surge in the government’s budget deficit in recent years.

Future Outlook:

  • With the country’s economic outlook remaining uncertain, the country’s fiscal deficit is unlikely to shrink much in the years ahead.

Mercosur Trade Agreement 

The Mercosur Trade Agreement is the pre-eminent trading group in South America and has four permanent members (Brazil, Argentina, Uruguay, and Paraguay). 

  • Mercosur was created in 1991 by the Treaty of Asuncion.
  • Mercosur’s first expansion has come about through the membership of Venezuela in 2012.
  • In addition, an associate member status was created for Chile, Bolivia, Colombia, Ecuador, and Peru.

Mercosur is designed to boost free trade between member states, with the ultimate goal of full South American economic integration.

  • Mercosur has aimed economically to reduce the high tariffs of member countries as well as the income inequalities between the countries.
  • The agreement also tries to eliminate the technological obstacles limiting member countries from bringing products to the market.
  • The introduction of Venezuela has increased speculation that Mercosur may begin to act increasingly as a political body rather than exclusively as an economic grouping of countries.

Forecast Assumptions and Risk 


Near-Term Global Growth to Remain Stable The near-term forecast for the global economy calls for overall economic growth rates to remain near current levels, with developed economies continuing to grow faster than in previous years.

Mid-Term Economic Risk Levels to Rise A number of risks (share price corrections, Chinese debt, political gridlock) will rise to more dangerous levels by 2019, jeopardizing the recent run of steady growth for many large economies.

Asia Drives Global Growth Asian emerging markets, led by China, India and Southeast Asia, will generate nearly half of the world’s economic growth over the near- and midterm.

Inflationary Pressures Persist Argentina’s economy will continue to be negatively impacted by high inflation over the near-term and this will prevent the economy from achieving the rates of growth from previous years.


A Global Power Vacuum Whether by design or due to internal political unrest, the United States’ ”America First” policies are resulting in power vacuums forming in many of the world’s most volatile regions.

Major Power Conflicts The risk of conflicts between large- and mid-sized powers is rising in the Middle East, Asia and East Europe, and any of these could have the scale needed to severely disrupt the global economy.

Inflationary Pressures Rise Again Argentina’s economic recovery could be derailed by the continuing high rates of inflation that have been in place in recent years.

Growing protectionism. Argentina must avoid a new round of protectionism in South America and other key export markets in order to boost needed export growth.

Economic risk outlook:

  • Argentina’s economic risk levels remain high, though they having fallen significantly over the past two years.
  • Inflation remains the greatest threat to Argentina’s economy and must be brought under control in order to avoid yet another recession in the coming years.
  • In addition, Argentina’s lingering debt problems continue to add to the risk levels facing the country’s economy.

Composition of Argentina’s Population

Immigration came predominantly from Spain and Italy.

  • Argentina is also home to more than 500,000 Middle Eastern immigrants.
  • It also has Latin America’s largest Jewish population.
  • In the 20th century, many immigrants have come from neighboring countries.

Spanish is the official language of Argentina

  • Italian and a variety of Amerindian languages are also spoken.

The Argentine president and vice-president are required by law to be Roman Catholics.

  • Roman Catholicism is by far the leading religion in Argentina.

Argentina: Leading Urban Centers


  • Buenos Aires is home to more than a third of all of Argentina’s population and the city has become one of the largest in the world.
  • As Argentina’s population continues to grow, Buenos Aires and other large cities such as Cordoba and Rosario will also see significant population growth.

Argentina has experienced a significant upswing in emigration in the wake of the economic collapse of 2001.

  • Over 270,000 people have emigrated from Argentina since 2001.
  • The leading destinations for these emigrants are Spain, Italy, the United States and Israel.
  • Argentina now has one of the highest emigration rates in South America.
  • Moreover, a high percentage of the population has indicated their desire to emigrate.
  • This brings the distinct possibility of a severe “brain drain” from Argentina.

Argentina was once one of the world’s leading recipients of immigrants, but decades of Moreover, with the country’s close ties with Europe and North America, the number of people hoping to emigrate will remain steady over the next few years.

Argentina: Topography and Climate

  • Few countries in the world have a more diverse topography than Argentina.
  • The western area of the country is dominated by the Andes Mountains.
  • The Gran Chaco and the Pampas cover the northern and central area of the country.
  • The south contains Patagonia which is a dry region of north-south running steppes.
  • Argentina has one of the world’s most varied climates.

economic deterioration and political instability have made Argentina a net emigration country.  • The northeast is tropical, while the Andes Mountains are cold and snowy at higher elevations.

  • Lowlands below the Andes are very arid, while the Pampas region has a mild climate with seasonal rains.

Key Environmental Issues:

Argentina is a world leader in setting targets for the reduction of greenhouse gases.

  • Nevertheless, much of the legislation associated with these plans has proven to be lax.

No other country in the world has suffered from holes in the ozone layer as has Argentina.

  • Parts of southern Argentina have been exposed to these holes, whereas much of the country has experienced significant thinning in the ozone layer.

Argentina’s major cities and industrial centers suffer from air and water pollution.

  • Buenos Aires has eight million cars driving in the city every day.
  • The grassy Pampas region of central Argentina suffers from high levels of industry-related pollution.

Demographic risk outlook:

  • The threat of large-scale emigration appears to have abated, reducing demographic risk levels for the present.

Environmental Risk Outlook:

  • Argentina is increasingly at risk from global warming, though efforts to combat ozone depletion appear to have paid dividends.


By | 2019-01-02T04:46:34+00:00 January 2nd, 2019|Uncategorized|0 Comments

About the Author:

Leave A Comment