Argentina Economy 2007

Economy - overview:
Argentina benefits from rich natural resources, a highly literate population, an export-oriented agricultural sector, and a diversified industrial base. Although one of the world's wealthiest countries 100 years ago, Argentina suffered during most of the 20th century from recurring economic crises, persistent fiscal and current account deficits, high inflation, mounting external debt, and capital flight. Beginning in 1998, with external debt equivalent to more than 400% of annual exports, the economy slowed and ultimately fell into a full-blown depression; investors' fears grew in the wake of Russia's debt default, Brazil's devaluation, and the political discord caused by then-President Carlos MENEM's unpopular efforts to run for a constitutionally prohibited third term. The government of Fernando DE LA RUA, elected President in late 1999, tried several measures to cut the fiscal deficit and instill confidence and received large IMF credit facilities, but nothing worked to revive the economy. Depositors began withdrawing money from the banks in late 2001, and the government responded with strict limits on withdrawals. When street protests turned deadly, DE LA RUA was forced to resign in December 2001. Interim President Adolfo Rodriguez SAA declared a default - the largest in history - on Argentina's foreign debt, but he stepped down only a few days later when he failed to garner political support from the country's governors. Eduardo DUHALDE became President in January 2002 and announced an end to the peso's decade-long 1-to-1 peg to the US dollar. When the peso depreciated and inflation rose, DUHALDE's government froze utility tariffs, curtailed creditors' rights, and imposed high taxes on exports. The economy rebounded strongly from the crisis, inflation started falling, and DUHALDE called for special elections. Nestor KIRCHNER was elected President, taking office in May 2003, and continued the restrictions imposed by DUHALDE. With the reemergence of double-digit inflation in 2005, the KIRCHNER administration pressured businesses into a series of agreements to hold down prices. The government also restructured its debt in 2005 and paid off its IMF obligations in early 2006, reducing Argentina's external debt burden. Real GDP growth averaged 9% during the period 2003-06, bolstering government revenues and keeping the budget in surplus.

GDP (purchasing power parity):
$608.8 billion (2006 est.)

GDP (official exchange rate):
$210 billion (2006 est.)

GDP - real growth rate:
8.5% (2006 est.)

GDP - per capita (PPP):
$15,200 (2006 est.)

GDP - composition by sector:
agriculture: 8.5%
industry: 35.9%
services: 55.6% (2006 est.)

Labor force:
15.76 million (2006 est.)

Labor force - by occupation:
agriculture: NA%
industry: NA%
services: NA%

Unemployment rate:
8.7% (2006 est.)

Population below poverty line:
26.9% (July-December 2006)

Household income or consumption by percentage share:
lowest 10%: 1%
highest 10%: 35% (June 2006)

Distribution of family income - Gini index:
48.3 (June 2006)

Inflation rate (consumer prices):
10.9% (2006 est.)

Investment (gross fixed):
23.4% of GDP (2006 est.)

Budget:
revenues: $51.9 billion
expenditures: $48.1 billion (2006 est.)

Public debt:
64% of GDP (2006 est.)

Agriculture - products:
sunflower seeds, lemons, soybeans, grapes, corn, tobacco, peanuts, tea, wheat; livestock

Industries:
food processing, motor vehicles, consumer durables, textiles, chemicals and petrochemicals, printing, metallurgy, steel

Industrial production growth rate:
8.2% (2006 est.)

Electricity - production:
101.1 billion kWh (2005)

Electricity - consumption:
88.98 billion kWh (2005)

Electricity - exports:
4.14 billion kWh (2005)

Electricity - imports:
8.017 billion kWh (2005)

Oil - production:
745,000 bbl/day (2005 est.)

Oil - consumption:
470,000 bbl/day (2004 est.)

Oil - exports:
367,600 bbl/day (2004)

Oil - imports:
21,650 bbl/day (2004)

Oil - proved reserves:
2.116 billion bbl (1 January 2006)

Natural gas - production:
43.76 billion cu m (2005 est.)

Natural gas - consumption:
38.79 billion cu m (2005 est.)

Natural gas - exports:
6.646 billion cu m (2005 est.)

Natural gas - imports:
1.669 billion cu m (2005)

Natural gas - proved reserves:
512.4 billion cu m (1 January 2006 est.)

Current account balance:
$7.998 billion (2006 est.)

Exports:
$46.46 billion f.o.b. (2006 est.)

Exports - commodities:
edible oils, fuels and energy, cereals, feed, motor vehicles

Exports - partners:
Brazil 17.5%, Chile 9.5%, US 8.9%, China 7.5% (2006)

Imports:
$32.59 billion f.o.b. (2006 est.)

Imports - commodities:
machinery and equipment, motor vehicles, chemicals, metal manufactures, plastics

Imports - partners:
Brazil 34.8%, US 12.6%, China 9.1%, Germany 4.5% (2006)

Economic aid - recipient:
$99.66 million (2005)

Reserves of foreign exchange and gold:
$32.03 billion (2006 est.)

Debt - external:
$109.7 billion (2006 est.)

Stock of direct foreign investment - at home:
$60.04 billion (2006 est.)

Stock of direct foreign investment - abroad:
$25.02 billion (2006 est.)

Market value of publicly traded shares:
$79.73 billion (2006)

Currency (code):
Argentine peso (ARS)

Exchange rates:
Argentine pesos per US dollar - 3.0543 (2006), 2.9037 (2005), 2.9233 (2004), 2.9006 (2003), 3.0633 (2002)