Introduction
This paper presents an overview and analysis of the economic, political, and social situation in Argentina. After providing a succinct historical background of the country, the paper supplies a review of the geographical, demographical and social, governmental, and economic situation in the Argentine Republic.
Brief Historical Background
The territories of modern Argentina were first discovered by the Europeans at the beginning of the 16th century. Later on, these lands were colonized and became part of the Spanish Empire. The empire used the territories as a source of gold and silver. At the beginning of the 19th century, however, the ideas of the Enlightenment spread around the territories of Argentina, and in 1816, “the United Provinces of the Rio Plata declared their independence from Spain” (Central Intelligence Agency [CIA], 2016b, par. 1). After the separation of Paraguay, Bolivia, and Uruguay, the rest of the territories became the country of Argentina. The majority of the immigrants who moved to Argentina originated from Italy and Spain, and the immigration from these countries was particularly intensive in 1860-1930 (CIA, 2016b).
Since the declaration of the country’s independence at the beginning of the 19th century and until the Second World War, numerous conflicts between the Unitarians and Federalists, as well as between military and civilian factions, prevailed in the history of Argentina (CIA, 2016b); several civil wars took place. After the Second World War, an era of Peronism followed; the president Juan Peron and his government attempted to implement the ideology of economic independence, social justice, and political sovereignty (Romero, 2013). Although the reforms were successful, the economy started declining in the 1950s.
The subsequent governments practiced military interventions, banned Peronism, and persecuted its followers. In the mid-1970, the Argentine Military Government, a junta, seized power in the country; it launched military terror (the so-called Dirty War) against all who were believed to be followers of left-wing political ideas (Romero, 2013). In 1983, however, a transition to democracy took place again; a president was elected. Since those times, the country has remained a representative democracy, even though it was faced with a number of challenges such as a serious crisis in 2001-2002, during which numerous violent public protests took place, and a number of presidents resigned (CIA, 2016b).
The current president of Argentina, Mauricio Macri, is a representative of a center-right political party of “Republican Proposal,” and has been in office since December 2015; he has canceled a number of taxes, lifted currency controls, and is an advocate of the free international trade policy (“Argentina Lifts Currency Controls,” 2015).
Geography
Argentina occupies the area of nearly 2,780,400 km2, out of which approximately 2,736,690 km2 (≈98.4%) are land (CIA, 2016b). It is the 8th largest country in the world, and the 2nd largest one in South America (after Brazil) (CIA, 2016b). It is located in the southern part of South America and shares borders with Bolivia, Uruguay, Paraguay, Chile, and Brazil (CIA, 2016b). It should also be highlighted that Argentina has access to the Atlantic Ocean; the total length of its coastline is 4,989 km (CIA, 2016b).
Argentina resides in a number of climatic zones, which include the subpolar climatic zone in the south of the country and the subtropical zone in its northern part (Hobbs, 2009). A share of the country’s territory is mountains; such mountain ranges as the Andes and Sierras Pampeanas are to be found in the country. Cerro Aconcagua, the highest mountain peak in Argentina, has a height of 6.960 km and is also the highest point in both the Southern and the Western hemispheres.
The natural environment of Argentina is extremely diverse, and the country serves as a home to a large number of animal and plant species, making it one of the most diverse ecosystems in the world (Hobbs, 2009). Clearly, this may have significant implications for the economy of the region, providing the necessary component for a major tourist industry.
In addition, the country is quite rich in natural resources; these include such minerals as zinc, copper, tin, lead, manganese, and iron ore, as well as gold and uranium ore; there is also a supply of oil in Argentina (CIA, 2016b). This allows for extensive mineral mining (8.8% of the country’s GDP as per 2010), as well as for a large share of oil refining and petrochemicals in the economy of the country (Thomas, 2012).
Furthermore, the vast territories of the country and the fact that the climate is mainly temperate allow for the development of agriculture. Even though only 13.9% of the land is arable, and only 0.4% of the land is employed in order to grow crops on a permanent basis (CIA, 2016b), it is still used for large-scale production of crops. For instance, the country serves as one of the largest biofuel exporters in the world (Thomas, 2012). Furthermore, 39.6% of the territory is utilized as permanent pasture areas (CIA, 2016b), which means that cattle husbandry is extensive in Argentina. It should also be pointed out that 10.7% of the land is used for the purposes of the forest industry (CIA, 2016b). On the whole, agriculture accounted for 51.1% of the country’s GDP in 2010 (Thomas, 2012).
As a country with an industrializing economy, Argentina suffers from a number of problems such as the degradation of soils, the loss of forest cover, desertification, and the pollution of both air and water (CIA, 2016b). However, being a country whose human development index is very high (Thomas, 2012), Argentina makes considerable efforts towards the preservations of the environment; for instance, Argentina is stated to be a leader in setting aims pertaining to the quantity of CO2 which is discharged into the environment and is a party to a number of international protocols and agreements aimed at maintaining the environmental safety (CIA, 2016b).
People and Society
The population of Argentina is nearly 43,887,700 people (as per July 2016 estimate) (CIA, 2016b). The country is highly urbanized; nearly 91.8% of its residents lived in urban areas in 2015 (CIA, 2016b). Simultaneously, the population is concentrated in the capital of the country, Buenos Aires, where approximately one-third of Argentina’s residents live, and in a number of other major cities; the rest of the Argentine territory is populated very sparsely (CIA, 2016b).
The population of the country is slowly growing, but the rates of growth are gradually decreasing; as per 2016, the annual growth rate is 0.93% (CIA, 2016b). It is stated that nowadays, the population of Argentina has the largest percentage of young individuals (aged from 15 through 24) in its history, which means that the provision of this group with a decent education and a sufficient number of jobs is rather likely to allow for the occurrence of a considerable economic growth (CIA, 2016b).
It should also be stressed that as of the 2016 estimate, the average life expectancy at birth (that is, the average length of time that a person is expected to live in the level of mortality does not change in the future) in Argentina is 77.1 years (74.0 years for males and 80.4 years for females), which is the 77th position (out of 224) in the world (CIA, 2016b). Judging from this figure, it is possible to state that the country’s overall quality of life is higher than average.
In this respect, it should also be noted that the “distance” between different countries on this scale is not equal; for instance, Malta occupies the 37th position (40 positions higher than Argentina) with the mean expectancy of life of 80.4 years (+3.3 in comparison to Argentina), whereas the 117th (40 positions lower than Argentina) position is occupied by El Salvador with the mean expectancy of 74.7 (only -2.4 in comparison to Argentina). Also, Argentina could easily have occupied the 72nd position if its average life expectancy was just 0.1 years greater (Central Intelligence Agency [CIA], 2016a).
The country also has rather high literacy rates (98.1% as of 2015); however, the unemployment rates were quite high (18.3%) in 2012, and the country occupied the 63rd place in the world out of 134, a rating in which a larger magnitude of the position denoted lower unemployment rates (CIA, 2016b).
Noteworthy, the country cannot be characterized as ethnically diverse, for nearly 97.0% of its population are White (mainly of Italian or Spanish origin); the rest 3.0% include Mestizo, Amerindian, and other non-white ethnic groups (CIA, 2016b). This may lower the chance of the development of racial conflicts. The state’s official language is Spanish; other widespread languages include Italian, English, French, and German, as well as some language of the indigenous peoples of Argentine lands (CIA, 2016b). The dominating religion is Christianity; 92.0% of the residents identify themselves as Roman Catholics (however, less than 20% of them actually practice religion); the rest of the population are comprised of Protestants (2.0%), Judaists (2.0%), and others (4.0%) (CIA, 2016b).
Government
As has already been stressed, Argentina has been a representative democracy since 1983 (Levitsky & Murillo, 2005). The state is currently a federal constitutional presidential republic; the Constitution of Argentina is the main legal document of the state (“Constitution,” n.d.). The president is elected every four years, along with the vice president. The president is considered the head of both the government (i.e., the executive branch of state power) and the state. The composition of the cabinet of government is also appointed by the president (CIA, 2016b).
The legislative branch of the state power is represented by the National Congress, which includes the Senate (comprises 72 seats, 1/3 of which is elected every two years by a simple majority voting procedure; each chosen member serves for 6 years), as well as the Chamber of Deputies (consists of 257 seats, each member works for 4 years, and half of the seats are selected every 2 years utilizing the mechanism of proportional representation) (CIA, 2016b).
The main institution of the judicial branch is the Supreme Court, which is comprised of the president of the court, it’s vice president, as well as of five judges; the judges are approved by the Senate after being offered as candidates for the position by the head of the state (CIA, 2016b).
The fact that the country has been under the rule of the representative democracy for more than three decades allows for assuming that it has had a certain degree of political stability. Political instability is known to adversely affect the economy of a country, for instance, causing large and uneven inflation, high rates of unemployment, a decrease in GDP growth rates (up to the negative growth of GDP), and so on (Levitsky & Murillo, 2005). Though there was a considerable disturbance in 2001-2002 due to a severe economic crisis (CIA, 2016b), and a number of president resignations, the situation did not grow to a large-scale revolt or usurpation of power, and the country was not thrown back as much as it could have been in the political conflict had been escalated.
The country has a multi-party system; CIA (2016b) provides a list of 11 political parties, noting that there also is a wide range of provincial parties in Argentina. There are also a variety of groups that can have a political influence; these include, for instance, labor unions and other labor organizations (e.g., General Confederation of Labor, Central of Argentine Workers, etc.), associations of landowners (e.g., Argentine Rural Confederation), the Roman Catholic Church, and others (CIA, 2016b). Interestingly, the right to vote is, in fact, an obligation in Argentina: suffrage is universal and compulsory (CIA, 2016b). This might seem contradictory: a compulsory democracy; however, it is established that voting is a duty of every citizen of the state and that this duty must not be neglected.
On the whole, the presence of a multi-party system means that the country can be described as having the system of government which is close to the ideal of representative democracy (Levitsky & Murillo, 2005); there might exist a possibility of a situation in which people, in certain cases, can indeed choose a candidate or a party that is more suitable for them, rather than having to select that one alternative of the two which represents the lesser evil.
In addition, the presence of multiple groups that can affect the politics also makes the country closer to the ideas of the representative democracy, providing individuals with a certain variety of choices if they wish to participate in the political life (Levitsky & Murillo, 2005). However, the direction in which the economy of the country is to develop can change due to being dependent on the party which currently has the greatest political power.
Argentina is administratively divided into 23 provinces; its capital, Buenos Aires, is considered to be an autonomous city (CIA, 2016b). The provinces are split into departments and municipalities; the provinces also enjoy a high degree of autonomy from the central government, creating constitutions of their own, choosing their local governments, selecting which rights and responsibilities they wish to delegate to the national governments and which ones they do not, and managing the resources present in their territories (“Constitution,” n.d., sec. 121-129). Economically, this means that, due to possible differences in legislation, conducting business in some parts of the country might be more profitable than in some of its other parts.
Economy
Argentina has vast reserves of natural resources, a large territory of lands that can be utilized for agricultural purposes, and a diverse industrial branch (CIA, 2016b). As of 2010, 51.1% of the country’s GDP was provided by the agricultural branch, 31.6% of the GDP came from the industry (oil refining and petrochemicals included); mining accounted for 8.8% of GDP, and the rest of it, 8.5%, came from other sources (Thomas, 2012). On the whole, the economy of the country is export-oriented (CIA, 2016b).
During the political instability that took place in 2001-2002 and was associated with a severe economic, political, and social crisis, the Argentine peso’s 1-to-1 peg to the dollar of the USA was canceled (i.e., the central bank stopped keeping the exchange rate of peso and dollar at the 1:1 level, and adopted a floating currency), the country experienced a considerable decrease in its GDP; the GDP of 2002 is stated to have been 18% smaller than that of 1998, and every three out of five residents of the country dropped below the poverty line (CIA, 2016b).
However, even though a number of presidents resigned, the country managed to enter a period of economic renewal and quick growth under the rule of President Nestor Kirchner, who introduced a number of regulations controlling the country’s market. As his wife, Cristina Kirchner, succeeded him as the President, the country’s economic growth slowed down, and a recession began, along with the world’s financial crisis.
Even though the economy experienced a considerable recovery in 2010, its development further slowed in 2011, which was addressed by the governmental intervention in 2012. Currency controls were introduced in 2012 so as to bolster the foreign reserves; later on, the government also tended to further control the foreign trade and exchange (CIA, 2016b). However, after being elected in 2015, the current president M. Macri took steps aimed at liberalizing the economy of Argentina, lifting the controls over the capital, as well as canceling some export controls (CIA, 2016b).
The government’s interventions allowed for stabilizing the situation in the economy of the country, providing a certain degree of stability in the otherwise unsteady economy. However, the currently taken measures aimed at liberalizing the economy might allow for a larger volume of imports, but that might mean that the country needs to become even more export-oriented as the products which were previously produced at home now come from the international market.
The country’s GDP was estimated as USD 884.2 billion (USD 20,500 per capita) in 2015, USD 862.9 billion (USD 20,200 per capita) in 2014, and UDS 885.2 billion (USD 21,000 per capita) in 2013 (the information is given in 2015 USD); the growth rate in comparison to the previous year was 2.4% in 2013, -2.5% in 2014, and 2.5% in 2015 (CIA, 2016b). This means that, even though the country experienced a decrease in its economy in 2014, it recovered its growth in 2015, and can grow beyond the level of 2013 in 2016 assuming that the rate of growth remains the same.
The poverty rates are rather high, 30%; although this is the 2010 estimate (CIA, 2016b), the large inflation rates (Flannery, 2016) might mean that the situation has not improved considerably. The public debt of Argentina kept growing in 2015 (41% of GDP in 2014, 50.1% of GDP in 2015), which might be one of the reasons why the new President decided to liberalize the economy. However, it is expected that the economy of the country will recover and further develop by the end of the current year (Flannery, 2016).
Conclusion
On the whole, it should be stressed that Argentina is a country with extremely rich territorial, mineral, social and economic resources, even though it is currently suffering from the adverse effects of the economic cycles. It is possible to state that, if managed properly, the country’s resources have the potential of turning Argentina into one of the affluent countries of the world.
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