Sur del Sur
The Southernmost South AgricultureLivestockFishing IndustryMining and Power Transportation and Communications The Rise and Transformation of
the Agricultural Export Model DiversificationIndustry The welfare StateA fresh start The last attempts Foreign Trade Exports and importsMercosur Argentine
economy followed a pattern of agricultural and livestock exports
which endured from the colonial times up to the early decades of the 20th
century. Then it gave rise to the production of some manufactures which stopped
coming from Europe, until the establishment of industries which would mark
the early path of the country.
One of the most important branches in Argentine economy is agriculture. It
does not only meet domestic demand but its exports also account for
a fourth of the total income from goods sold abroad.
LIVESTOCK Argentine beef, valued worldwide due to its quality and taste, accounts
for a 10 per cent of the exports, aside from its numerous by-products. Furthermore,
it fully meets domestic demand.
For Argentine economy, fishing is an important source of income with a great
future ahead. A thousand species of fish, shellfish and mammals are
estimated to live in the Argentine Sea.
It was not until 1940 that the national industry, which had inceptively
started in the times of the Hispanic colonies, became stronger. After suffering
serious crises, today it faces the need of renewal and technological change
in order to be competitive.
Argentina has a large mining stockpile and important power resources. However,
operation at a large scale is still an unachieved goal.
Transportation and communications have started to gain a great significance
in Argentine economy. In 1990, it accounted for a 5 per cent of the Domestic
Gross Product. Technological development is the key for the increase of this
and the overcoming of imports by exports is a national goal in a country which
seeks its place in the international market. To keep the product quality and
to lower costs are the challenge which the country has to face.
RISE AND TRANSFORMATION OF THE AGRICULTURAL EXPORTS MODEL
From late 19th
century up to the beginnings of the present century, Argentine economy was
based on farming exports. The center of business activities was located
in Buenos Aires and the Littoral. The significance of the turnover
was such that, towards 1910, our country did hold the eleventh position in
the world ranking.
The fall of export supply from Europe during the First World War brought about
a serious setback in the Argentine economy. Only in 1917 was there a slow
recovery with manufacturing, mining and construction investment.
The 1920s came together with industrial development and the technological
transformation of the countryside based on an economically liberal
model, supported by the agricultural and livestock sectors. But
the 1929 crisis seriously weakened the national economy.
By the 1930s, some urban sectors claimed that the State should foster industrial
development, and this type of industrialization began to spread during the
Second World War. The replacement of exports was the key for larger
foreign currency savings.
The above model was starting to wear out by the 1950s. There were inflation,
recession and sluggishness, and the foreign debt increased. The agricultural
and livestock exporters, in turn, could no longer find a market to sell their
goods. The industrialists started to witness the decrease of domestic demand
and their costs rose due to the increased prices of the imported factors of
The 1976 military government wanted to do away with inflation
through the opening up of the economy and free trade. The outcome was
the decrease of the operating capacity and a steep growth of the foreign debt.
With the return of democracy by 1983, the welfare of the Argentinians
had diminished dramatically. Nowadays, the role of the state is far from being
focused on welfare.
the former 5,800 dollar shortfall could be reversed. Whereas exports went
up to 17,503 millions, imports were 16,432 millions. The corresponding surplus
was 1,071 millions.
Half the foreign trade volume is carried out with US, Brazil, Germany and
Italy. The business transactions carried out with Asia, Africa and Oceania
are near a 20 per cent. Most of the trade with bordering countries is carried
out with Brazil.
Exports from Argentina are goods with little processing: fats, furs, leather,
animal feed, cotton, fuels, oils and by-products. Vegetable and animal raw
material accounted for a third of the export volume. Industrial goods
are less than a sixth of the total exports.
Imports are basically focused on machinery, mechanical and electronic appliances
and devices. Cars, chemicals, fuels, metallurgical minerals and metal manufactures
are imported to a lesser extent.
On January 1st, 1995 Mercosur began to operate (a free trade area between
Argentina, Brazil, Paraguay and Uruguay). Chile is likely to be included in
a short time. This union is gaining strength and stands only after the European
Union because of its relevance. Except for the products from automobile and
sugar-processing industries, the rest circulates without any customs taxes.
They have adopted a common tax for the imports from the rest of the
world. 200 million people live in this area and the domestic turnover is 800,000
For further information:
Ministerio de Economía-IndiceBusiness Invitation Globalink : http://www.tdb.gov.sg
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