Business Environment in Argentina
After the severe recession, which lead to the Argentinian bankruptcy in 2001-2002, the economy saw a rapid and stable growth, before being hit by the global financial crisis. In 2009 the economy contracted sharply as an effect of the fall in demand (0.9% of growth) but in 2010 it experienced a quick and vigorous recovery, together with the rest of the South-American continent. The 2010 growth, estimated at 7.5% and driven by household consumption, public spending good performance of the agricultural sector and dynamic trade with Brazil, should nevertheless slow down in 2011.
In the context of the coming 2011 elections, the government of Cristina Fernandez de Kirchner is likely to continue the expansionist policy to stimulate domestic demand. Controlling the increasing inflantion also remains a priority. In addition, the Argentinian economy is suffering from structural faults: the financial system remains fragile and the country needs to deal with an energy crisis dues to lack of investment in this sector since 2004.
The social situation of the country is sensitive: unemployment and malnutrition persist, with
25% of the population living under the poverty line.
|GDP (billions USD)||310.17||370.27||456.82||526.30||578.48|
|GDP (Constant Prices, Annual % Change)||0.8||9.2e||6.0||4.6||4.2|
|GDP per Capita (USD)||7,728||9,138||11,169||12,749||13,886e|
|General Government Balance (in % of GDP)||-1.6||-1.4e||-3.7e||-3.6e||-3.6e|
|Inflation Rate (%)||6.3||10.5||10.2||11.5e||11.0e|
|Unemployment Rate (% of the Labor Force)||8.7||7.7e||9.0e||8.5||8.4|
|Current Account (billions USD)||8.65||9.52e||7.23e||9.32e||-|
|Current Account (in % of GDP)||2.8||2.8||2.0||2.5||-|
Source: IMF - World Economic Outlook Database
Note: (e) Estimated Data
Main Sectors of Industry
Having lost the position of a superpower it occupied at the beginning of the 20th century, Argentina remains an important world economy, namely due to its agricultural production. The agricultural sector, which is based livestock farming, cultivation of cereals (wheat, corn, soy) and citrus fruit, represents around 10% of the country’s GDP.
Rich in energy resources, Argentina is the world’s fourth largest oil producer and first largest natural gas producer in Latin America.
The industry sector has vastly expanded over these last few years. It contributes to more than one third of the GDP. Food packaging (in particular meat packing, flour grinding, and canning) and flour-milling are the country's main industries.
The services sector followed the same trend as the industry sector. Today, it contributes to more than half of the GDP. Argentina has specialized in areas of high-tech services and offers excellent value for money specifically in software development, call centers and nuclear energy.
|Breakdown of Economic Activity By Sector||Agriculture||Industry||Services|
|Employment By Sector (in % of Total Employment)||0.8||23.7||75.2|
|Value Added (in % of GDP)||7.5||31.8||60.7|
|Value Added (Annual % Change)||-15.7||-1.2||1.4|
Source: World Bank - Last Available Data.
|Argentine Peso (ARS) - Average Annual Exchange Rate For 1 USD||2.90||3.05||3.10||3.14||3.71|
Source: World Bank
Indicator of Economic Freedom
- Mostly unfree
- World Rank:
- Regional Rank:
Foreign Trade in Figures
Argentina is very open to international exchanges, foreign trade represening around 45% of the GDP. Its main commercial partners are the Mercosul countries (Brazil, Paraguay and Uruguay), China and the United States. Argentina exports more than it imports and its trade balance is therefore in surplus.The devaluation of the peso has boosted Argentina's exports (especially of agricultural products). However, the increased rate of the Argentinian peso compared to the American dollar risks damaging the competitiveness of Argentina's exports which would cause the balance of trade to deteriorate.
|Foreign Trade Indicators||2006||2007||2008||2009||2010|
|Imports of Goods (million USD)||34,152||44,706||57,423||38,780||56,443|
|Exports of Goods (million USD)||46,546||55,779||70,023||55,668||68,500|
|Imports of Services (million USD)||8,242||10,569||13,041||11,658||13,635|
|Exports of Services (million USD)||7,899||10,233||11,884||10,762||12,752|
|Imports of Goods and Services (Annual % Change)||15.4||20.5||14.1||-19.0||-|
|Exports of Goods and Services (Annual % Change)||7.3||9.1||1.2||-6.4||-|
|Imports of Goods and Services (in % of GDP)||19.2||20.3||20.7||16.0||-|
|Exports of Goods and Services (in % of GDP)||24.8||24.6||24.5||21.4||-|
|Trade Balance (million USD)||13,958||13,456||15,423||18,528||-|
|Trade Balance (Including Service) (million USD)||13,458||12,990||14,513||-||-|
|Foreign Trade (in % of GDP)||44.0||45.0||45.1||37.4||-|
Source: WTO - World Trade Organization ; World Bank
Main Partner Countries
(% of Exports)
|Other partnersClose extended list||54.2%|
(% of Imports)
|Other partnersClose extended list||35.7%|
Sources of General Economic Information
Ministry of the Economy
Secretariat of Agriculture, breeding, fishing and food (Sagpya)
Ministry of Foreign Relations, International Trade and Religion
- Statistical Office
Instituto Nacional de Estadística y Censos (INDEC)
- Central Bank
Banco Central de la República Argentina
- Stock Exchange
Bolsa de Comercio de Buenos Aires
- Search Engines
Grippo (in Spanish)
- Economic Portals
Portal of Argentina, Economic Section
- Executive Power
- Executive power is held by the President of the Argentine nation. It is his/her responsibility to respond to national interests.
The President is the supreme head of the country, head of government, the politician responsible for the general administration of the country and commander-in-chief of the armed forces. The president is elected by universal suffrage for four years and can be re-elected for two consecutive terms of office. The vice-president is elected with him/her. The president appoints the Council of Ministers.
Argentina has 23 provinces and 1 autonomous federal district, which have retained some powers which do not belong to the federal government. They elect their own legislators and provincial governors.
- Legislative Power
- The legislative power is composed of a two-chamber parliament: a lower chamber, the Chamber of Deputies elected for 4 years by direct universal suffrage, and an upper chamber, the Senate elected for 6 years also by direct universal suffrage.
The parliament is called Congreso Nacional (National Congress).
- Main Political Parties
- The country has two large political parties: the PJ (Partido Justicialista, also called the Peronist Party) and the UCR (Civic Radical Union). Traditionally, the UCR has a more middle class, urban electorate, and the PJ an electorate of workers. But today both parties have a wider electoral base. The smaller parties, like the center-right PRO (Republican Initiative for Alliance) and, further left, the ARI (Argentina for an Egalitarian Republic) occupy different positions in the political spectrum, and some are only active in a few provinces.
- Current Political Leaders
- President : Cristina FERNANDEZ de KIRCHNER (since 2007)
Vice President : Julio COBOS
- Next Election Dates
- Presidential elections:october 2011
Chamber of Deputies and Senate:october 2011
Indicator of Freedom of the Press
- World Rank:
- 21 places up compared to 2008
Indicator of Political Freedom
- Political Freedom:
- Civil Liberties:
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Buoyed by strong growth in domestic production and investment, the Argentine economy has rebounded fast after dipping down to a meagre growth of 0.9% in 2009.
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