ARGENTINA’S ECONOMY

Agron/Econ 496

Sergio Lence

February, 2009

POPULATION, 2007

Argentina 39 million United States 302 million China 1,300 million India 1,073 million World 6,390 million

World Population Density

Population (bottom) and Internet (top) densities

World Gross Domestic Product (1999)

Earth’s Satellite Picture at Night

Gross National Income (2007)

Argentina U.S.

Total Current U$S 0.24 trillion 13.9

trillion PPP U$S 0.51 trillion 13.8 trillion

Per Capita Current U$S 6,050 46,040 PPP U$S 12,990 45,850

Nominal GDP vs. PPP GNP

Argentinean Economy

Upper-middle income, Western-style market economy (World Bank classification): Low income (< $935 GNI per capita)

49 countries (e.g., Haiti) Lower-middle income ($936-$3,705)

54 countries (e.g., Peru, Ecuador, Paraguay) Upper-middle income ($3,706-$11,455)

41 countries (e.g., Argentina, Brazil, Mexico) High income (> $11,455)

65 countries (e.g., US, Canada)

Composition of GDP (%)

0

10

20

30

40

50

60

70

80

Value Added by Sector (% of GDP)

Argentina 31.54 9.64 58.82

United States 23.05 1.6 75.35

Industry, value added (% of GDP)

Agriculture, value added (% of GDP)

Services, etc., value added (% of GDP)

0

200

400

600

800

1000

1200

Indices of Economic Activity

Argentina 416.38 112.02 81.97

United States 1164.29 551.38 658.88

Fixed line and mobile phone subscribers (per 1,000 people)

Internet users (per 1,000 people)Personal computers (per 1,000

people)

0

2000

4000

6000

8000

10000

12000

14000

16000

18000

20000

Indices of Economic Activity

Argentina 3760 2051.63 1578.98

United States 19850 12398.96 7899.61

CO2 emissions (kg per capita)Electric power consumption

(kwh per capita)Energy use (kg of oil equivalent

per capita)

CO2 Emissions Per Capita

Argentinean Economy: History

Long history of government involvement Military governments (until 1982) Populist governments (e.g., Peron, Peronist party)

Major economic reforms starting in the 1990s Privatization Currency conversion

Major economic crisis in 2001/02

Argentinean Peso

Currency of Argentina 1 U$S = 3.49 Argentinean Pesos

Introduced in 1992

Argentinean Peso

Argentinean Peso

Argentinean Peso

Argentinean Peso: History

PESO Moneda Nacional (starting in 1881)

PESO Ley (starting in 1970) 1 Peso Ley = 100 Pesos Moneda Nacional

PESO argentino (starting in 1983) 1 Peso argentino = 10,000 Pesos Ley

AUSTRAL (starting in 1985) 1 Austral = 1,000 Pesos argentinos

PESO (starting in 1992) 1 Peso Ley = 10,000 Australes

Argentinean Peso: History

Various Argentine currencies towards the US Dollar

Monetary Conversion Rates

Fall in value of the Argentine currency vs. U.S. dollar

Monetary Conversion Rates

Fall in value of the Argentine currency vs. U.S. dollar

Monetary Conversion Rates

Argentinean Pesos per U.S. dollar

INFLATION

ANNUAL INFLATION

Argentina US

1998 4% 4%

1999 -3% 4%

2000 -1% 4%

2001 -4% 1%

2002 -11% 2%

2003 9% 3%

2004 9% 4%

2005 9% 3%

2006 8% 3%

2007 9% 2%

GDP Growth Per Capita

Annual GDP Growth (%)

-15.00%

-10.00%

-5.00%

0.00%

5.00%

10.00%

15.00%

1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007

Argentina US

Annual Growth in GDP (%)

-0.79%

-4.41%

-10.89%

8.84% 8.98%

3.69%

0.52%2.21%

3.10%4.40%

-15.00%

-10.00%

-5.00%

0.00%

5.00%

10.00%

2000 2001 2002 2003 2004

Argentina United States

Annual Inflation (%)

1.04%

-1.10%

30.56%

10.50% 9.19%

2.18% 2.38% 1.54% 1.83% 2.08%

-5%

0%

5%

10%

15%

20%

25%

30%

35%

2000 2001 2002 2003 2004

Argentina United States

65

70

75

80

85

90

Indices of Development

Argentina 74.46 81.26

United States 77.41 88.35

Life expectancy at birth, total (years) School enrollment, secondary (% net)

Life Expectancy at Birth, 2004

60

65

70

75

80

85

90

GINI Index (higher income inequality, higher index)

Argentina 51 U.S. 41

Infant Mortality

0

5

10

15

Argentinean Economy:Current Concerns

Large government deficit Government-distorted economy Inflation Unfavorable world market situation Government vs. Farmers

THE END