Jose Sanchez
Research expert covering society, economy, & politics for Latin America
Key economic indicators of Argentina - statistics & facts
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Argentina is considered a developing nation of upper-middle income. It is the third largest economy in Latin America and, as its membership in the G20 and prospective accession to the OECD reflect, it stands among the world’s major economies. Argentine GDP was estimated at 654.89 billion U.S. dollars in 2023, considerably far from the GDP of its regional competitors, Brazil and Mexico. Nevertheless, since the GDP is not adjusted for a country’s population size, GDP per capita is better suited for country-to-country comparisons. Looking at this indicator, the picture changes considerably, as Argentina falls to a 6th position in the Latin American region, 14th if the Caribbean is also considered, with a GDP per capita of 13,730 U.S. dollars.
Argentina counts with large and diversified agriculture and industry sectors, which, together, account for about 30 percent of the national GDP and 27 percent of the employment. Across its 2.8 million square kilometers of territory, Argentina is privileged with access to vast natural resources. This natural richness has allowed the country to develop major industries in automobile, agriculture, textiles, and mining. Nevertheless, this has also made the country develop high levels of commodity dependence, like most of its South American neighbors, and is therefore vulnerable to international economic shocks and commodity price fluctuations.
Argentina's abundant natural resources means it has great potential in the renewable energy sector as well, which it has yet to explore. Following the fall in biofuel production experienced since 2017, it dropped from the major biofuel producers worldwide ranking. Moreover, the manufacturing sector — the largest industry in Argentina — while diversified, is also closely linked to this richness in natural resources, as food processing (of soybean oil, sunflower oil, wine, etc.) has a paramount role in the sector.
The country’s inability to manage its finances has led to a long history of loans and defaults. The corralito, three sovereign defaults, massive debt restructurings, and the largest bailout of the IMF’s history are some of the country’s economic milestones in the 21st century. Since joining the IMF in 1956, Argentina has received over 20 financial-support programs from the institution. In 2021, even though the nation still owed 40 billion dollars to the IMF from the 2018 bailout, it took another 44 billion dollar loan, which added to the already substantial external debt. On the bright side, there seems to be some improvements: as of 2022, the national debt in relation to the Argentine GDP decreased to 84.68 percent, the lowest level since 2017, and so did the size of the government’s debt hold in foreign currency.
Argentina counts with large and diversified agriculture and industry sectors, which, together, account for about 30 percent of the national GDP and 27 percent of the employment. Across its 2.8 million square kilometers of territory, Argentina is privileged with access to vast natural resources. This natural richness has allowed the country to develop major industries in automobile, agriculture, textiles, and mining. Nevertheless, this has also made the country develop high levels of commodity dependence, like most of its South American neighbors, and is therefore vulnerable to international economic shocks and commodity price fluctuations.
A country rich in natural resources
Considered as an agricultural giant, the South American nation is one of the world's leading producers and exporters of soy, beef, corn, yerba mate, and wheat, amongst other products. Visibly, agriculture is one of the pillars of Argentina’s exports, as reflected in the volume of trade and diversity of its trade partners, ranging from neighboring country Brazil to Algeria, or the Asian superpower, China. In 2022 alone, Argentina exported approximately 3.08 billion U.S. dollars’ worth of soybean, one of the country’s main commodities. Argentina ranks as one of the leading soybean producing and exporting countries worldwide. However, while allowing for great economic profits, this shift towards extractivism and agribusiness has negative social and environmental consequences. For instance, the so-called “sojization” of Argentina’s agriculture has resulted in soil degradation, expansion of monocultures, replacement of food crops, displacement of farmers and indigenous people, and deforestation.Argentina's abundant natural resources means it has great potential in the renewable energy sector as well, which it has yet to explore. Following the fall in biofuel production experienced since 2017, it dropped from the major biofuel producers worldwide ranking. Moreover, the manufacturing sector — the largest industry in Argentina — while diversified, is also closely linked to this richness in natural resources, as food processing (of soybean oil, sunflower oil, wine, etc.) has a paramount role in the sector.
Inflation and public debt, the main challenges
Over the past decades, inflation — even hyperinflation in the late 80s — and public debt have become chronic issues in the South American nation. The economic stagnation, or even recession, experienced in recent years has not contributed to alleviating the situation. The government has resorted on several occasions to printing money in order to cover its fiscal deficit, especially given its temporary loss of access to international credit markets. This has only served to further boost inflation, which exceeded 275 percent since the beginning of 2024, even surpassing 280 percent in some months of 2024. The sectors most affected by recent price increases have been food and non-alcoholic beverages.The country’s inability to manage its finances has led to a long history of loans and defaults. The corralito, three sovereign defaults, massive debt restructurings, and the largest bailout of the IMF’s history are some of the country’s economic milestones in the 21st century. Since joining the IMF in 1956, Argentina has received over 20 financial-support programs from the institution. In 2021, even though the nation still owed 40 billion dollars to the IMF from the 2018 bailout, it took another 44 billion dollar loan, which added to the already substantial external debt. On the bright side, there seems to be some improvements: as of 2022, the national debt in relation to the Argentine GDP decreased to 84.68 percent, the lowest level since 2017, and so did the size of the government’s debt hold in foreign currency.
Jose Sanchez
,
Sep 17, 2024
Jose Sanchez
Research expert covering society, economy, & politics for Latin America
