Argentina 

Argentina country policy

Policy established 29 March 2011

• Case-by-case assessment
• The country ceiling is 1000 mln euro
• Early warning signal 100 mln euro
• - of which was used as at 2012-02-29 3 mln euro

Country class: 7

Uitsluitend dekking op particulieren

Only private buyers

Argentina country facts

Atradius Dutch State Business Economic Research

Country Report last updated :  10 December 2011   
Country :  ARGENTINA

Political Situation

Rather Stable Now

Head of state
President Cristina Fernández de Kirchner.

Form of government
Government of the Frente Para la Victoria (FV), a faction of the Partido Justicialista (PJ, Peronist Party).

Internal Economic Situation
Moderation Of Growth

General situation
After two years of high GDP-growth (appr. 9% p.a.) on the back of expansionary macro-economic policies and good export results, more moderate economic expansion to be expected from 2012 as exportgrowth is abating and a more restrictive fiscal/monetary policy has become urgent. Moreover, structural rigidities by government interventions are impeding GDP-growth as well. Official data understate the real rate of inflation, one of the highest in the emerging markets (9.9% Sept 2011). The financial sector shows an adequate provisioning and is well capitalised. But there continues to be divergence between public and private banks, also because of high exposure of state banks to the sovereign. Unfavourable TI-corruption index (105th out of 178). 
 
External Economic Situation :  Weakening; Still Arrears

Main sources of foreign exchange
Agricultural origin exports (52%), industrial exports (48%).  

Main foreign markets
Brazil (21%), EU (20%), Asia (16%), USA (10%). 

Main expenses of foreign exchange
Intermediate products (35%), capital goods (22%).
 
Balance of payments 
Strongly increased imports since 2009 have weakened the trade balance and contributed to emerging current account deficits after years of surpluses. Capital outflows in the wake of the Nov-elections have eroded the international liquidity position even more. Therefore, trade, capital and foreign exchange controls had to be introduced to stem capital flight and stabilise reserves. A peso-adjustment (stronger depreciation of the official rate) would be more appropriate. Argentina continues to be a highly dollarised economy.