Alfonsín: Difference between revisions
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The Central Bank declared that they didn’t have any official record of the external debt. Therefore they had to trust the foreign lenders and the contracts signed by the dictators. However, the new democratic government decided to recognize the debt, public as well as private | The Central Bank declared that they didn’t have any official record of the external debt. Therefore they had to trust the foreign lenders and the contracts signed by the dictators. However, the new democratic government decided to recognize the debt, public as well as private. | ||
==Hyperinflation== | ==Hyperinflation== | ||
Inflation rose to 672% in 1985, and government expenditures increased from 11% of GDP in 1984 to 18% in 1985. A IMF-sponsored program, Plan Primavera, was sort of successful for a while: | Inflation rose to 672% in 1985, and government expenditures increased from 11% of GDP in 1984 to 18% in 1985. A IMF-sponsored program, Plan Primavera, was sort of successful for a while: | ||
*Government expenditures falling from 16% of GDP in 1986 to 11% in 1988. | *Government expenditures falling from 16% of GDP in 1986 to 11% in 1988. | ||
*Inflation fell briefly to 90% in 1986 before rising to 343% in 1988. | *Inflation fell briefly to 90% in 1986 before rising to 343% in 1988. | ||
However, in April 1988, Argentina found itself way behind its external debt payments. Inflation reached 28% per month. So Alfonsin tried to fix prices. This didn't work due to lack of trust. In 1989, the World Bank suspended the aid that it was giving to Argentina. Immediately, everyone started buying US dollars. | |||
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==Alfonsin resigns== | ==Alfonsin resigns== | ||
The failure of the Argentine government to respond effectively to its economic problems contributed to an erosion of investor confidence, massive capital flight, devaluation of the peso, and hyperinflation of | The failure of the Argentine government to respond effectively to its economic problems contributed to an erosion of investor confidence, massive capital flight, devaluation of the peso, and hyperinflation of 300% in 1989 and 200% in 1990. Alfonsín resigned five months before the end of his term in 1989 and yielded power to Carlos Menem. | ||
==Sources== | ==Sources== |
Latest revision as of 03:18, 6 December 2006
President Alfonsín successfully brought human rights back; and made the case for trade liberalization, deregulation, and privatization. However, Alfonsín lacked the leadership skills necessary to carry out the economic reforms he sought. For example, the government proposed Plan Austral in 1984, with the support of the IMF, to impose fiscal discipline and control skyrocketing inflation of 627 percent that year.
The Central Bank declared that they didn’t have any official record of the external debt. Therefore they had to trust the foreign lenders and the contracts signed by the dictators. However, the new democratic government decided to recognize the debt, public as well as private.
Hyperinflation
Inflation rose to 672% in 1985, and government expenditures increased from 11% of GDP in 1984 to 18% in 1985. A IMF-sponsored program, Plan Primavera, was sort of successful for a while:
- Government expenditures falling from 16% of GDP in 1986 to 11% in 1988.
- Inflation fell briefly to 90% in 1986 before rising to 343% in 1988.
However, in April 1988, Argentina found itself way behind its external debt payments. Inflation reached 28% per month. So Alfonsin tried to fix prices. This didn't work due to lack of trust. In 1989, the World Bank suspended the aid that it was giving to Argentina. Immediately, everyone started buying US dollars.
Alfonsin resigns
The failure of the Argentine government to respond effectively to its economic problems contributed to an erosion of investor confidence, massive capital flight, devaluation of the peso, and hyperinflation of 300% in 1989 and 200% in 1990. Alfonsín resigned five months before the end of his term in 1989 and yielded power to Carlos Menem.
Sources
Heritage Foundation
ATTAC Argentina
Duke University
Introduction | Dictatorship | Carlos Menem | Fernando de la Rúa
Interim Presidents | Néstor Kirchner | Graphs | Final Analysis