Argentina rebounds thanks to partnering with Mexico, the newest and possibly wealthiest Associate Member of MERCOSUR

Published 4 weeks ago




The Member; Argentina, has experienced fluctuations in economic growth over the past decade in recent years, growth has slowed sharply once again as dangerously high inflation pressures have weakened domestic demand. has undergone massive fluctuations in recent decades.




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. Gross Domestic Demand(GDP) growth will be weak at best over the near term as export demand remains weak and high inflation impacts domestic demand growth. Moreover, Argentina's Economic imbalances could result in much lower rates of economic growth later in the forecast period.




By the 1920’s Argentina was one of the world's wealthiest countries. Argentina has one of the worlds largest Agricultural industries and exports are a key element of the economy. Of the Major four provinces of MERCOSUR which contribute around 30% to the Argentina’s GDP and comprise of 61.8% of the country’s population. 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.


 


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.

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. 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, these Latin American countries are now Associate Members of MERCOSUR. He also moved to remove currency controls and to restore the independence of the country’s monetary and statistical agencies. It is this power of our allies our Associate Member countries that give MERCOSUR access to unlimited capital through these confidential and private trade agreements. These relative additions to MERCOSUR by integrating the new emerging markets in




Chemicals, rubber and food sectors are major recipients of FDI in 2015. Gradually liberalizing the Argentine economy along with investment-friendly policies are expected to spur investments over the next four years (2017-2020). Argentina is well connected through intra-city buses, commuter rail, trams and high-speed rails. The country has international railway links with Bolivia, Brazil, Chile, Paraguay and Uruguay. Agrilend views of Argentina identifies the potentials of Argentina as an investment destination by analyzing the political, economic, social, technological, legal and environmental structure in conjunction with its stronghold on MERCOSUR agricultural financial,trade,import and export dominance internationally. Although its agricultural component remains proficient strong but it is shifting into more of a manufacturing prowess to take advantage of not only its agricultural industry but other industries interconnected to its economic growth potential again, to accomplish this the military stronghold established by Ernesto "Che" Guevara an Argentine Marxist revolutionary, physician, author, guerrilla leader, diplomat and military theorist has taken a radical reduction in Military Spending while its neighbor Member in MERCOSUR; Brazil, has increased it during this time.




The argentine military has lost much of its influence and power in defeat in the Falklands war in 1982. The military government was removed from power in 1983 and armed forces have been marginalized since then. Today, Argentina's military capabilities remain relatively limited. Even by South American standards, its military powers are limited. For example, Argentina has little ability to project power outside 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 was for the best part of the past 150 years the wealthiest country in Latin America. However its advantage, its neighbors shrunk and Chile has recently taken overtaken Argentina in terms of per capita GDP. As of the late 1930’s Argentina dominated wealth globally. 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 Argentine Economy will continue to recover from its recent collapse, thanks in large part to new export opportunities. Its key factors to sustained growth are exchange rate fluctuations, growing export revenues, rebuilding domestic consumer confidence, adequate pricing for natural resources, adding manufacturing industrial manufacturing production to not only supplement its agricultural export revenues but possibly integrating new lines like motor vehicle manufacturing which would supplement its Rubber production as well. Job creation is trending upwards and it will be foreign direct investment and exports that will provide for the continuity of this job creation.




Argentina has one of the worlds largest export oriented Agricultural sectors. Beef, Sheep, Soya, and grains are exported throughout the world. Argentina competes with the United States of America, Canada, and Australia in each of these sectors. Argentina is one of the world's leading exporters of beef. Demand for Argentine exports continues to rise, but climate conditions in Argentina have lead to an uneven performance in recent years. Furthermore, competition from Brazil has had a major impact on Argentine beef exports.


Argentina's Agricultural sector withstood the recent economic crisis better than the most and is set to grow as exports potential expands.


The key to Argentinas future growth is increasing its manufacturing to supplement its existing agricultural, and retail output and because of its connection with Mexico and its existing Rubber production possibly adding the automotive manufacturing sector.







Robert Morgan Bellevue, WA
4 weeks ago
https://agfuse.com/article/argentina-rebounds-thanks-to-partnering-with-mexico-the-newest-and-possibly-wealthiest-associate-member-of-mercosur
Robert Morgan
Robert Morgan