(CNN Spanish) — Argentina is one of the largest countries in the world in terms of territory and a historic food producer, which in recent decades has been alternating periods of growth with severe economic crises.
This is a look at the functioning of the economy of the South American country.
Basic data of Argentina
Independence from Spain in 1816Argentina has an extension of 3,761,274 square kilometers (which includes 2,791,810 of the American continental part, 965,597 of its claim in the Antarctic continent and 3,867 of the southern islands in dispute with the UK), according to him National Geographic Institute of the country. Is he eighth largest country in the world.
Argentina is located at the southern tip of America, it has borders with Chile, Bolivia, Paraguay, Brazil and Uruguay and an extensive coastline of 4,725 kilometers over the Atlantic Ocean. To the west its territory is marked by the Andes mountain range.
The climate in the country is mostly tempered, although due to its extension (3,694 kilometers from north to south) there are tropical regions in the north and subantarctic in the south.
Argentina bill with fertile plains in its central region, in addition to important mining and fishing resources, as well as oil and gas deposits.
The largest city in the country is Buenos Aires (2.9 million inhabitants, which amounts to 12.8 million taking into account the metropolitan area), which is also the capital, followed by Córdoba (1.45 million), Rosario (1.2 million) and Mendoza (930,000).
According to the provisional results of the last censusheld in 2022, the total population amounts to 47,327,407.
Main products
Due to its extensive and fertile central plains, known as “the humid Pampa”, Argentina has been a historical food producer, among them soybeans, corn, wheat, sunflower and barley, as well as meat and dairy products.
There are also numerous mining operations in the country, that produce mainly zinc, iron, copper, uranium and others, among others. There are also oil and natural gas deposits.
In addition to food and raw materials, Argentina has an important and diversified industrial sector, although some sectors currently rely on protectionist measures to survive. Its main products include processed foods, vehicles, consumer goods, textiles, chemicals and steel, among others.
Local industry is an important source of work in the country (28% of the total labor force), although services lead in terms of employment (66.1%). The agricultural sector employs 5.3% of the total. Unemployment in 2022 stood at 7% in the first quarter of 2022, according to the National Institute of Statistics and Census (Indec).
Economy of Argentina: the numbers of a difficult situation
Argentina’s Gross Domestic Product has been falling since 2018, and was hit hard by the restrictions imposed amid the covid-19 pandemic in 2020. In 2021, amid the recovery from the previous crash, it jumped and fell. stood, in nominal values, at US$ 491,490 million, according to the World Bank.
Adjusted for purchasing power parity, which measures the purchasing power in each country, Argentina’s real GDP reached US$985.21 billion in 2021, according to the same source.
This means a nominal GDP per capita of US$10.729and a real GDP per capita of US$ 23.627. According to the CIA World Factbook, Argentina is located in this way ranked 86th out of 229 countriesand in Latin America it is only surpassed by Chile and Uruguay (and shares values with Costa Rica).
Agricultural products make up the 10.8% of GDP, although they lead in exports. Industrials represent 28.1% and services 61.1%.
In 2021, Argentina exported for a value of US$ 77,934 million, according to Indec data. The value includes US$21,808 million in primary products, US$30,900 million in agricultural manufactures, US$19,913 million in industrial manufactures and US$5,283 million in fuels and energy.
That same year, goods worth US$ 63,183 million were imported, also according to the Indec. This value is divided into capital goods for US$10,180 million, intermediate goods for US$25,758 million, fuels for US$5,843 million, industrial parts and accessories for US$11,890 million, consumer goods for US$7,236 million and vehicles for US$ 1,681 million, among others.
For almost a decade, Argentina has been dealing with high levels of inflation. In June, INDEC reported a year-on-year rise of 64% in the consumer price index, and an expectations report from the Central Bank of the Argentine Republic anticipates 76% by 2022.
Former President Mauricio Macri, predecessor of current President Alberto Fernández, let the government with an annual inflation rate of 53.8%, while Cristina Fernández de Kirchner finished her mandate in 2015 with an inflation rate of between 18.5% and 30%depending on the estimates.
As the official currency of Argentina, the peso, has been devaluing consistently since the end of the so-called “convertibility” in 2002, when the country abandoned its exchange parity regime with the dollar. In July 2022, it was trading at 130.4 pesos per dollar, following closing 2021 at 102.72 per dollar, 84.1 per dollar in 2020 and 59.89 pesos per dollar in 2019.
In the country there are numerous dollar quotes due to purchase restrictions: from the official dollar, used in tradeup to the dollar obtained in the Stock Market (the MEP) and the parallel or “blue” dollar.
In this context, the country currently has some of the lowest wages measured in dollars in the region: and monthly minimum wage 45,540 Argentine pesos is equivalent to approximately US$334 at the official exchange rate or US$135 to the “blue dollar”.
The public sector in Argentina has long registered a high primary deficit in its public accounts, which in May 2022 reached 162,411.7 million Argentine pesos (regarding US$ 1,245 million at the official exchange rate), according to official data.
Meanwhile, the GINI coefficient, which measures income distribution, stood at 0.42 in 2020 (where closeness to 0 indicates greater equality, and closeness to 1 indicates greater inequality), according to the World Bank. This places the country in 51st place out of 174 economies, in accordance with el CIA World Factbook.