Néstor Kirchner

Argentina was competitive globally due to the high exchange rate of the country, which made exports relatively cheap. Being a large producer of soy and the fact that the price of soy was relatively high contributed to an enormous amount of foreign currency in the economy, as China became a key consumer of the Argentine soy.

A New Plan

• Kirchner implemented a plan to improve the collection of taxes, hold more reserves for social welfare, and to push for the importing of goods. While doing this, the government also tried to control spending in other aspects of the country so the debt would not once again skyrocket.
• The result of these programs and controlled expenditures gradually allowed the peso to regain its value, recovering to a 3-1 rate vs. the American dollar.
• As this happened, tourism started to return to Argentina, and the exports of agricultural goods grew.

Better Times

An enormous trade surplus resulted, and the government had to intercede into the process in order to keep the peso from gaining further value. Had this occurred, the tax collection plan would have been ruined. Had the tax scheme been ruined, further reindustrialization would have been dispirited.

Argentina’s GDP has grown each year, jumping 8.8% in 2003, 9.0% in 2004, and 9.1% in 2005, and possibilities of 7.5% for 2006. Worker’s wages have not totally caught up to this growth, but are moving up along with prices.

A 12% inflation rate in 2005 was considerably lower than that of other economic crises, but it had still provoked the government to "cool down" some sectors of the economy, restrict benefits for exporters, and put pressure on companies in order to even out prices. Unemployment was reduced substantially in 2005, but the distribution of income has not yet been leveled out.

Table of National Accounts

This table depicts the numbers and percentages for the Argentine economy under President Kirchner, as well as the expected numbers for 2006 & 2007.

Projected GDP Growth

This graph reinforces the numbers from the National Accounts table, showing how the GDP is going to grow over the next couple of years.

Payments of the IVA(Impuesto al Valor Agregado)

---

Introduction | Dictatorship | Raúl Alfonsín | Carlos Menem | Fernando de la Rúa

Interim Presidents | Graphs | Final Analysis