By: Christopher Barclay
Introduction
As approximately fifty-three nations are currently experiencing debt distress or are at risk of defaulting on their loans, there is growing speculation about a global debt crisis.[i] Compounding this, the U.S. Federal Reserve, by increasing interest rates to control inflation, seems indirectly to have sent disproportionate reverberations throughout the global currency market.[ii] While unlikely, a global debt crisis could necessitate immediate action and bold concessions, making it a potentially complex and neuralgic political action problem. Against this unsettling backdrop, Argentina’s economic challenges stand out as particularly pressing. Amid an official inflation rate of nearly 100 percent and a repeatedly frustrated sovereign debt restructuring process, the Argentine Peso (ARS) / U.S. Dollar (USD) exchange rate has gone from $1 USD being worth approximately $60 ARS in January 2020 to $1 USD being worth over $220 ARS by April 2023.[iii] Additionally, the unofficial, ‘dólar blue’ ARS/USD exchange rate channels seem to value the Argentine peso half as much, possibly indicating that the currency may be overvalued.[iv] With 2023 marking two hundred years of diplomatic relations between Argentina and the United States, coinciding with an election year in Argentina, the present time may appear to be a pivotal strategic moment for the United States to adopt foreign economic policies that aim to mutually benefit the U.S. and Argentine economies and promote positive long-lasting bilateral relations.[v]
This essay contributes to the larger dialogue on U.S. grand strategy and U.S.–Argentine bilateral relations by examining the recent depreciation of the ARS/USD exchange rate: a highly visible indicator of U.S.–Argentine economic relations. After situating the ARS/USD exchange rate depreciation within its broader historical and economic context, the essay briefly reconstructs the efforts of Minister of Economy Martín Guzmán and the Alberto Fernández administration to implement restorative exchange rate policies while managing fiscal and monetary policies from 2020–2022. Complicating matters further, Argentina’s exchange rate policies are deeply intertwined with other urgent economic issues: namely, restructuring Argentina’s sovereign debt, curbing the COVID-19 pandemic, tackling inflation, battling the recession, increasing foreign investment, and bolstering Argentine economic productivity. Because exchange rates play a crucial role in determining the amount of imports, exports, and foreign investment between countries, a highly devaluated ARS/USD exchange rate may strain U.S.–Argentine economic relations. With this in mind, the piece encourages U.S. policymakers to critically weigh the implications of ARS/USD exchange rate devaluation, the disastrous adverse effects of past monetary and currency-related policy prescriptions, and how the ongoing Argentine economic predicament may affect long-term U.S.–Argentine strategic bilateral relations.
The Historical Intimacy of the ARS/USD Exchange Rate
Unpacking the historical intimacy between the U.S. dollar and the Argentine peso may provide insights to better understand Argentina’s current economic predicament and the recent, acute depreciation of the ARS/USD exchange rate. In 1990, Domingo Cavallo, Argentina’s Minister of the Economy, instituted a new Argentine peso with a fixed exchange rate pegged to the U.S. dollar by a currency board as a measure to curb rapid inflation. Implementing a currency board ensured that one Argentine peso would be equivalent to one U.S. dollar under the condition that Argentina must hold enough U.S. dollars to back outstanding pesos.[vi] As a result, the Argentine public was given a choice of currencies to use in transactions and savings while limiting the government’s ability to intervene with monetary policy.[vii] Although the currency board successfully reduced inflation from around 1,344 percent in 1990 to 0 percent in 1996, it also had adverse effects: for example, the resulting lack of Argentine currency independency seemed to hurt Argentine exports when the currencies of its major trading partners, including Brazil and Western Europe, depreciated against the U.S. dollar.[viii] After the economy experienced a period of soaring economic growth between 1991–1994, a brief recession in 1995 revealed that Argentina had begun taking on an increasingly precarious amount of external debt.[ix] A complex chain of events – including depressed financial markets, a sharp fall in Argentine exports to Brazil, and tax hikes to target a widening deficit – resulted in the Argentine Great Depression.[x] After negotiations for a deal with the International Monetary Fund (IMF) failed in December 2001, massive protests erupted across the country followed by violent police repression and a run on the banks. Amid an impending economic crisis, the government hastily abandoned the fixed exchange rate and ushered forward the largest default in history.[xi] The ensuing depression was devastating: Argentina’s GDP declined by 18 percent, unemployment spiked to unprecedented levels, and around 19 million Argentines were left impoverished.[xii] The economic and political turmoil of the early 2000s left a lasting impression upon Argentine society that continues to inform the country’s leadership and foreign policy.
A Free-Floating Currency
While the switch to a managed free-floating currency may have hastened economic recovery, it also seemed to contribute to a persistent increase in inflation that limited the possibilities to preserve competitiveness by leveraging exchange rate flexibility.[xiii] As the events of the 2010s would reveal, the country’s relationship with external debt was not permanently resolved by the abrogation of the fixed exchange rate. Despite a recovery that established healthy surpluses during the 2008–10 period, deficits reached a worrying six percent by 2017, and the government struck an agreement with bondholders in order to continue to borrow abroad.[xiv] With seigniorage financing two-thirds of the deficit, inflation rose to approximately 25 percent per year while the debt-to-GDP ratio rose to over 50 percent by the end of 2017.[xv] A few months after an ambitious IMF plan had been signed in an effort to inspire confidence in the Argentine economy, the main indicators in the Argentine economy fell far below the IMF’s projections.[xvi] Already in an exacerbated context, the complicated relationship between Argentine foreign currency controls and domestic economics would only become more evident during the pandemic.
The 2020-2022 Efforts to Restore the Argentine Economy
For policymakers to responsibly implement mutually beneficial U.S. foreign economic policy towards Argentina, it is necessary to comprehend the interlocking challenges plaguing the Fernández administration as it endeavored to implement policies during the pandemic. After defeating incumbent president Mauricio Macri in December 2019, current Argentine President Alberto Fernández “reversed fiscal austerity measures, suspended the IMF program, and declared public debt levels unsustainable.”[xvii] He also appointed Martín Guzmán, a leading scholar of sovereign debt restructuring and debt crisis resolution, to serve as the Minister of Economy.[xviii]
In an April 2019 op-ed, Guzmán outlined what he considered to be the issues at the core of Argentina’s predicament.[xix] In Guzmán’s view, President Macri’s economic policies during the 2010s, geared toward attracting foreign debt investment and increased productivity, inadvertently resulted in a currency crisis in April 2018. In September of the same year, the Macri administration secured an additional $57 billion loan from the IMF, the largest loan in its history, to address Argentina’s macroeconomic problems.[xx] Failing to restore market confidence in a depreciating peso, the government and IMF agreed that Argentina could use the loan to meet its debt payments to avoid a default in 2019.[xxi] The fund was also used to sell up to $9.6 billion of its foreign-exchange reserves to help support the exchange rate.[xxii] Guzmán suggested that hiking interest rates to stabilize the price level resulted in short-term speculative portfolio capital. Instead, he proposed that chronic inflation required sustained, coordinated policy efforts, as inflation would continue in the short term regardless of the tightness of monetary policy.[xxiii]
Guzmán suspected that resolving the debt crisis would be extraordinarily complicated, but he likely did not anticipate having to do so while tackling a pandemic. On March 3rd, 2020, the first case of COVID-19 within Argentina was reported.[xxiv] With Argentina’s fragile health system overwhelmed by the pandemic, the country worked quickly in 2020 to curb infections and encourage infection prevention methods.[xxv] During a conversation between Joseph Stiglitz and Guzmán, the scholars agreed that the pandemic made things much worse for countries with excess debt.[xxvi] Due to inflation, central banks began increasing interest rates, which appreciated the dollar and made it difficult for countries to pay off their debts atop interest rates.[xxvii] Guzmán noted that in 2020, the Argentine government, with IMF approval, aimed to tackle debt to private creditors before its IMF debt.
While Guzmán worked with the IMF throughout 2020–22 to secure more funding and implement his policy ideas, it seems as though the magnitude and complexity underlying the economic challenges during COVID-19 were simply too much. Despite conditions under the Fernández administration appearing to be getting moderately better on the surface, as detailed in a March 2022 IMF Staff Report a month after Guzmán resigned as Minister of Economy, the government continued to rely on central bank financing, and inflation pressures rose.[xxviii] While government policy was also directed toward appreciating the exchange rate, intervening in the securities market, and limiting price adjustments, the peso continued to depreciate.[xxix]
A Glimpse Ahead
In some respects, the current depreciation of the Argentine peso may seem slightly reminiscent to the inflation of the 1980s.[xxx] However, as in the 1990s, it seems that the Argentine economy may remain at high risk from external shocks that could send the economy into a spiral.[xxxi] One economic forecast suggests that Argentina’s real GDP growth during 2023 will shrink by one percent before growing by roughly 2.5–2.8 percent between 2024 and 2027.[xxxii]Meanwhile, the same forecast seems to predict that the ARS/USD exchange rate will continue to devaluate considerably. To attenuate for continued depreciation and increased vulnerability to external shocks, President Fernández, along with Brazilian President Luiz Inácio Lula da Silva, announced in late January that they had begun preparations on a joint Brazilian–Argentine currency.[xxxiii] It seems unlikely that this plan will come to fruition. In late March, President Biden and President Fernández met in Washington to discuss issues such as international financial support for Argentina, cooperation in areas such as food, energy, and critical minerals, and the Russian invasion of Ukraine. There also may have been discussion regarding the growing influence of China in the region to secure strategic access to Argentina’s rich lithium reserves.[xxxiv] As a result of this meeting, President Biden seemed to express support for IMF concessions, while President Fernández seemed to reaffirm Argentine–U.S. economic cooperation and alignment on strategic issues.[xxxv]
Ultimately, it does not seem as though the United States has many available options to genuinely help Argentina alleviate its current economic situation. An assay of the historic background related to the ARS/USD exchange rate and the economic challenges faced by the recent Fernández administration reveals key insights regarding the shortcomings of previous policy prescriptions. Considering how past IMF loans may have exacerbated Argentina’s economic standing, it may be worthwhile for U.S. policymakers to reassess whether it is possible that the policy of pushing for IMF loans could backfire in the long run. Further, bolder approaches to reviving trust in the currency, such as the soft-dollarization of the 1990s, may lead to disastrous long-term economic consequences.[xxxvi] Beyond this scope exist the realities of institutional political incentives, considerable international uncertainty, and the limits of governments to implement coordinated and sustained policy efforts. In conclusion, to establish enduring and constructive U.S.-Argentine ties, policymakers must balance the need for mutually advantageous foreign economic policies with a thorough understanding of Argentina’s intricate economic and political landscape.
Works Cited:
“2022 Investment Climate Statements: Argentina.” n.d. United States Department of State (blog). Accessed December 9, 2022. https://www.state.gov/reports/2022-investment-climate-statements/argentina/.
Rawi Abdelal, Mark Blyth, and Craig. Parsons. 2010. Constructing the International Economy. Cornell Studies in Political Economy. Ithaca: Cornell University Press.
Dennis R. Appleyard, and Alfred J. Field. 2017. International Economics / Dennis R. Appleyard, Davidson College, Alfred J. Field, Jr., University of North Carolina at Chapel Hill. Ninth edition. New York, NY: McGraw-Hill Education.
“Argentina: Staff Report for 2022 Article IV Consultation and Request for an Extended Arrangement under the Extended Fund-Facility-Press Release; Staff Report; and Staff Supplements.” n.d. IMF. Accessed November 18, 2022. https://www.imf.org/en/Publications/CR/Issues/2022/03/25/Argentina-Staff-Report-for-2022-Article-IV-Consultation-and-request-for-an-Extended-515742.
Argentina, U. S. Mission. 2023. “Secretary Blinken Bicentennial Statement.” U.S. Embassy in Argentina. March 22, 2023. https://ar.usembassy.gov/secretary-blinken-bicentennial-statement/.
BBC News. 2018. “Why US Rates Have a Global Impact,” June 13, 2018, sec. Business. https://www.bbc.com/news/business-44389203.
Isabel Bernhard. 2023. “The US and Argentine Presidents Left the Most Important Words Unsaid.” Atlantic Council (blog). March 31, 2023. https://www.atlanticcouncil.org/blogs/new-atlanticist/the-us-and-argentine-presidents-left-the-most-important-words-unsaid/.
“Blue Dollar Rates : Dólar Blue Informal Rate of US Dollar in Argentina | Blue Dollar Rates.” 2016. January 8, 2016. https://bluedollar.net/informal-rate/.
Paul Blustein. 2006. And the Money Kept Rolling in (and out) Wall Street, the IMF, and the Bankrupting of Argentina / Paul Blustein. [Electronic Resource] : New York: PublicAffairs.
“Buenos Aires Times | ‘Satisfied’ Fernández Flies Home with Biden’s Vow of Support.” n.d. Accessed April 19, 2023. https://www.batimes.com.ar/news/argentina/satisfied-fernandez-flies-home-with-bidens-vow-of-support.phtml.
Francisco J. Buera and Juan Pablo Nicolini. n.d. “‘The Case of Argentina’ on Manifold at the Becker Friedman Institute for Economics.” Manifold | BFI. Accessed April 17, 2023. https://manifold.bfi.uchicago.edu/read/case-of-argentina/section/9905ef24-8c94-42ad-adf7-068efb4d9afb.
“Cash Flow Discount, Inflation, Exchange Rate and COVID-19: A Model Applied in Argentinian Market.” 2020. Revista de La Facultad de Ciencias Económicas (Chaco, Argentina) 25 (2): 35–59. https://doi.org/10.30972/rfce.2524564.
Cenital. 2019. “¿Qué hacemos con el dólar?” Cenital (blog). August 13, 2019. https://cenital.com/que-hacemos-con-el-dolar/.
Nicolás Cherny. 2015. “Institutions, Credibility and Crisis: The Inconsistencies of Argentine Exchange Rate Policy (1991-2006).” Brazilian Journal of Political Economy 35 (1): 95–113. https://doi.org/10.1590/0101-31572015v35n01a06.
“China’s Growing Influence in Latin America.” n.d. Council on Foreign Relations. Accessed January 26, 2023. https://www.cfr.org/backgrounder/china-influence-latin-america-argentina-brazil-venezuela-security-energy-bri.
“Country Report Argentina October 2022.” 2022. London: The Economist Intelligence Unit N.A., Incorporated.
Robert C. Feenstra and Alan M. Taylor. 2017. International Economics / Robert C. Feenstra, University of California, Davis, Alan M. Taylor, University of California, Davis. Fourth edition. New York, NY: Worth Publishers.
Financial Times. 2018. “Mauricio Macri’s Failure to Plan Has Put Argentina in a Tight Spot,” October 1, 2018.
———. 2020. “Martín Guzmán: Argentina Cannot Afford to Pay Creditors More,” May 3, 2020.
———. 2023. “How to Avoid a Developing World Debt Crisis.”, March 29, 2023, sec. The FT View. https://www.ft.com/content/1bbce83b-aebe-4fd2-afd2-02e45ed5338d.
Jeffry A.Frieden. 2015. Currency Politics : The Political Economy of Exchange Rate Policy / Jeffry A. Frieden. Princeton, New Jersey: Princeton University Press.
Peter S. Goodman and Daniel Politi. 2021. “‘We Were Left With Nothing’: Argentina’s Misery Deepens in the Pandemic.” The New York Times, April 19, 2021, sec. Business. https://www.nytimes.com/2021/04/19/business/argentina-economy.html.
Robert E. Grosse and Clarice. Pechman. 1994. Foreign Exchange Black Markets in Latin America / Robert E. Grosse with Clarice Pechman. Westport, Conn: Praeger.
Martín Guzmán. “Martín Guzmán.” [Personal Bio] Accessed April 28, 2023. https://martinmguzman.com/.
Martín Guzmán. 2019. “The Trouble with Argentina’s Economy | by Martín Guzmán.” Project Syndicate. April 10, 2019. https://www.project-syndicate.org/commentary/argentina-wrong-economic-policies-by-martin-guzman-2019-04.
Martin Guzman. n.d. “El camino inestable de la economía argentina.” Accessed November 25, 2022. https://www.cronista.com/columnistas/El-camino-inestable-de-la-economia-argentina-20190325-0069.html.
“How Do Rising U.S. Interest Rates Affect Emerging and Developing Economies?” 2023. February 7, 2023. https://blogs.worldbank.org/developmenttalk/how-do-rising-us-interest-rates-affect-emerging-and-developing-economies.
Hubbard R. Glenn. 2019. Economics. Seventh. New York NY: Pearson.
“INTERNATIONAL MONETARY FUND Lessons from the Crisis in Argentina.” 2003. https://www.imf.org/external/np/pdr/lessons/100803.pdf.
Ivan F. Julio and Jorge M. Oviedo. 2022. “The Asymmetric Effects of Argentina’s Fiscal Deficits on the Real Exchange Rate.” Emerging Markets Finance & Trade 58 (9): 2567–2601. https://doi.org/10.1080/1540496X.2021.2004888.
Peter B. Kenen. 2005. “How Things Went Wrong in Argentina.” Finance & Development 42 (3): 51.
Jonathan Kirshner. 2003. “Money Is Politics.” Review of International Political Economy 10 (4): 645–60.
Ariel González Levaggi. 2023. “More Than a Symbolic Encounter: Fernández-Biden at the White House,” April. https://www.csis.org/analysis/more-symbolic-encounter-fernandez-biden-white-house.
John E. Marthinsen. 2020. Demystifying Global Macroeconomics / John E. Marthinsen. 3rd Edition. Berlin ; De Gruyter,. https://doi.org/10.1515/9781547401437.
Juan Miguel Massot. 2019. “La Politica Cambiaria Argentina Entre 2016 y 2019. Situacion y Alternativas Desde Una Perspectiva de Economia Politica. (Argentina’s Exchange Rate Policy between 2016 and 2019: Context and Possible Scenarios from a Political Economy Perspective. With English Summary.).” Actualidad Económica (Córdoba, Argentina)29 (99): 3–16.
Mindel, Maia. 2021. “What Went Wrong with Argentina?” Substack newsletter. Some Unpleasant Arithmetic (blog). September 20, 2021. https://someunpleasant.substack.com/p/what-went-wrong-with-argentina.
———. 2022. “Going Green.” Substack newsletter. Some Unpleasant Arithmetic (blog). April 5, 2022. https://someunpleasant.substack.com/p/going-green?utm_medium=reader2.
Parker, Jeffrey. n.d. “Money and Inflation in Argentina Case – Economics – Reed College.” Reed College. Accessed April 12, 2023. https://www.reed.edu/economics/parker/f10/201/cases/Argentina.html.
Perez Artica, Rodrigo. 2020. “El Desempeño Cambiario Del Sector Automotriz En Argentina y El Impacto de La Inversión.” Estudios Económicos 37 (74): 5–35. https://doi.org/10.52292/j.estudecon.2020.2105.
“Principales Variables.” n.d. Accessed April 18, 2023. https://www.bcra.gob.ar/PublicacionesEstadisticas/Principales_variables_datos.asp.
“Real Exchange Rates for Economic Development.” n.d. CEPR. Accessed November 25, 2022. https://cepr.org/voxeu/columns/real-exchange-rates-economic-development.
“Remarks by President Biden and President Alberto Fernández of Argentina Before Bilateral Meeting.” 2023. The White House. March 29, 2023. https://www.whitehouse.gov/briefing-room/speeches-remarks/2023/03/29/remarks-by-president-biden-and-president-alberto-fernandez-of-argentina-before-bilateral-meeting/.
Rock, David. 2002. “Racking Argentina.” New Left Review 17 (17): 55-86+i.
Roett, Riordan, and Carol. Wise. 2000. Exchange Rate Politics in Latin America / Carol Wise and Riordan Roett, Editors.Washington, D.C: Brookings Institution Press.
Romo, Analya, and Citlaly Ojeda-Galaviz. 2021. “It Takes More than Two to Tango with COVID-19: Analyzing Argentina’s Early Pandemic Response (Jan 2020–April 2020).” International Journal of Environmental Research and Public Health18 (1): 73. https://doi.org/10.3390/ijerph18010073.
Roos, Jerome. 2019. Why Not Default? : The Political Economy of Sovereign Debt / Jerome Roos. Princeton: Princeton University Press.
Schrank, Peter. 2012. “Official Statistics: Don’t Lie to Me, Argentina.” The Economist (London) 402 (8773).
Smith, William C. 2022. Authoritarianism and the Crisis of the Argentine Political Economy / William C. Smith. Stanford, CA: Stanford University Press,. https://doi.org/10.1515/9780804743730.
Sosa, Luis Molinas. 2020. Exchange Rates in South America’s Emerging Markets / Luis Molinas Sosa, Central Bank of Paraguay, Caio Vigo Pereira, University of Kansas. Elements in the Economics of Emerging Markets. Cambridge: Cambridge University Press.
Steinberg, Federico, and Miguel Otero-Iglesias. 2023. “South America’s ‘Common Currency’ Is Actually about De-Dollarization,” February. https://www.csis.org/analysis/south-americas-common-currency-actually-about-de-dollarization.
Stiglitz, Joseph, and Weisbrot, Mark. 2022. “The IMF’s Agreement with Argentina Could Be a Game Changer.” Center for Economic and Policy Research (blog). March 10, 2022. https://www.cepr.net/the-imfs-agreement-with-argentina-could-be-a-game-changer/.
Taylor, Alan M. 2014. “The Argentina Paradox: Microexplanations and Macropuzzles.” NBER Working Paper Series, NBER Working Paper Series, , 19924. https://doi.org/10.3386/w19924.
The Economist. 2022. “The 53 Fragile Emerging Economies,” July 20, 2022. https://www.economist.com/finance-and-economics/2022/07/20/the-53-fragile-emerging-economies.
———. 2023. “Argentina and Brazil Propose a Bizarre Common Currency,” January 26, 2023. https://www.economist.com/finance-and-economics/2023/01/26/argentina-and-brazil-propose-a-bizarre-common-currency.
———. n.d. “Argentina Is Wasting the Vast Opportunities China Offers It.” Accessed April 11, 2023a. https://www.economist.com/the-americas/2023/03/07/argentina-is-wasting-the-vast-opportunities-china-offers-it.
———. n.d. “Argentina’s Currency Crisis Is Far from over.” Accessed September 25, 2022b. https://www.economist.com/finance-and-economics/2018/07/05/argentinas-currency-crisis-is-far-from-over.
The New York Times, The Editorial Board. 2023. “Opinion | How to Avoid Another Global Debt Crisis.” The New York Times, April 17, 2023, sec. Opinion. https://www.nytimes.com/2023/04/17/opinion/imf-debt-crisis-china.html.
“The Global South under Debt Distress.” n.d. Accessed December 6, 2022. https://ny.fes.de/article/the-global-south-under-debt-distress.
United Nations Conference on Trade and Development. 2022. “Trade and Development Report 2022.” UNCTAD/TDR/2022, October.
Valdecantos, Sebastian. 2022. “Endogenous Exchange Rates in Empirical Stock-Flow Consistent Models for Peripheral Economies: An Illustration from the Case of Argentina.” Journal of Post Keynesian Economics ahead-of-print (ahead-of-print): 1–31. https://doi.org/10.1080/01603477.2022.2103827.
Veigel, Klaus Friedrich. 2005. “Governed by Emergency: Economic Policy -Making in Argentina, 1973–1991.” ProQuest Dissertations and Theses. Ph.D., United States — New Jersey: Princeton University. 305385330. ProQuest Central; ProQuest Dissertations & Theses Global. https://www.proquest.com/dissertations-theses/governed-emergency-economic-policy-making/docview/305385330/se-2?accountid=8285.
Weisbrot, Mark, and Lara Merling. 2018. “Argentina’s Deal with the IMF: Will ‘Expansionary Austerity’ Work?,” December.
Endnotes:
[i] “How to Avoid Another Global Debt Crisis.” The New York Times, April 17, 2023, sec. Opinion. https://www.nytimes.com/2023/04/17/opinion/imf-debt-crisis-china.html.; “How to Avoid a Developing World Debt Crisis.” Financial Times, March 29, 2023, sec. The FT View. https://www.ft.com/content/1bbce83b-aebe-4fd2-afd2-02e45ed5338d.; The Economist. 2022. “The 53 Fragile Emerging Economies,” July 20, 2022. https://www.economist.com/finance-and-economics/2022/07/20/the-53-fragile-emerging-economies.
[ii] BBC News. 2018. “Why US Rates Have a Global Impact,” June 13, 2018, sec. Business. https://www.bbc.com/news/business-44389203; “How Do Rising U.S. Interest Rates Affect Emerging and Developing Economies?” 2023. February 7, 2023. https://blogs.worldbank.org/developmenttalk/how-do-rising-us-interest-rates-affect-emerging-and-developing-economies.
[iii] “Principales Variables.” n.d. Accessed April 18, 2023. https://www.bcra.gob.ar/PublicacionesEstadisticas/Principales_variables_datos.asp.
[iv] It is necessary to take the values of the blue dólar rate with a grain of salt, as it may be difficult to accurately measure. However, with this considered, it is possible that estimates for the blue dólar rate may shed light into the real ARS/USD exchange rate. One notes that in January 2020, the ‘blue dólar rate’ seems to have been $1 USD for about $70 ARS: only $10 above the national rate. As of April, 2023, the blue dólar rate seems to be $1 USD for approximately $400 ARS: nearly $200 above the national rate. This possibly suggests that the official ARS/USD may be overvalued. Source: “Blue Dollar Rates : Dólar Blue Informal Rate of US Dollar in Argentina | Blue Dollar Rates.” Graphed from 2018-04-16 to 2023-04-17, https://bluedollar.net/informal-rate/.
[v]U. S. Mission Argentina. 2023. “Secretary Blinken Bicentennial Statement.” U.S. Embassy in Argentina. March 22, 2023. https://ar.usembassy.gov/secretary-blinken-bicentennial-statement/.; House, The White. 2023. “Remarks by President Biden and President Alberto Fernández of Argentina Before Bilateral Meeting.” The White House. March 29, 2023. https://www.whitehouse.gov/briefing-room/speeches-remarks/2023/03/29/remarks-by-president-biden-and-president-alberto-fernandez-of-argentina-before-bilateral-meeting/.
[vi]Peter B. Kenen 2005. “How Things Went Wrong in Argentina.” Finance & Development 42 (3): 51.
[vii] Jeffrey Parker, n.d. “Money and Inflation in Argentina Case – Economics – Reed College.” Reed College. Accessed April 12, 2023. https://www.reed.edu/economics/parker/f10/201/cases/Argentina.html.
[viii] Ibid.; Dennis R. Appleyard, and Alfred J. Field. 2017. International Economics / Dennis R. Appleyard, Davidson College, Alfred J. Field, Jr., University of North Carolina at Chapel Hill. Ninth edition. New York, NY: McGraw-Hill Education., 646
[ix] Paul Blustein. 2006. And the Money Kept Rolling in (and out) Wall Street, the IMF, and the Bankrupting of Argentina / Paul Blustein. [Electronic Resource] : New York: Public Affairs., 237-8
[x] 238; Appleyard and Field, 646; David Rock 2002. “Racking Argentina.” New Left Review 17 (17): 55-86; Luis Molinas Sosa. 2020. Exchange Rates in South America’s Emerging Markets / Luis Molinas Sosa, Central Bank of Paraguay, Caio Vigo Pereira, University of Kansas.Elements in the Economics of Emerging Markets. Cambridge: Cambridge University Press., 5
[xi] Rock, 55-6
[xii] Ibid.; “INTERNATIONAL MONETARY FUND Lessons from the Crisis in Argentina.” 2003. https://www.imf.org/external/np/pdr/lessons/100803.pdf.
[xiii] Nicolás Cherny. 2015. “Institutions, Credibility and Crisis: The Inconsistencies of Argentine Exchange Rate Policy (1991-2006).” Brazilian Journal of Political Economy 35 (1): 95–113. https://doi.org/10.1590/0101-31572015v35n01a06.; Sosa, 5; “Spoilt for Choice: 1.” 2002. Economist.Com. Global Agenda, 1.; David Rock 2002. “Racking Argentina.” New Left Review 17 (17): 55-86+i.
[xiv] Sosa, 6; Financial Times. 2018. “Mauricio Macri’s Failure to Plan Has Put Argentina in a Tight Spot,” October 1, 2018; Francisco J Buera, and Juan Pablo Nicolini. 2019. “The Monetary and Fiscal History of Argentina, 1960-2017.” IDEAS Working Paper Series from RePEc. https://doi.org/10.21034/sr.580., 19-20
[xv] Buera and Nicolini, 20-1
[xvi] Mark Weisbrot and Lara Merling. 2018. “Argentina’s Deal with the IMF: Will ‘Expansionary Austerity’ Work?,” December.
[xvii] “2022 Investment Climate Statements: Argentina.” n.d. United States Department of State (blog). Accessed December 9, 2022. https://www.state.gov/reports/2022-investment-climate-statements/argentina/.
[xviii] “Martín Guzmán.” n.d. Martín Guzmán [Personal Bio]. Accessed April 28, 2023. https://martinmguzman.com/.
[xix] Martín Guzmán. 2019. “The Trouble with Argentina’s Economy | by Martín Guzmán.” Project Syndicate. April 10, 2019. https://www.project-syndicate.org/commentary/argentina-wrong-economic-policies-by-martin-guzman-2019-04.
[xxiv] Analya Romo and Citlaly Ojeda-Galaviz. 2021. “It Takes More than Two to Tango with COVID-19: Analyzing Argentina’s Early Pandemic Response (Jan 2020–April 2020).” International Journal of Environmental Research and Public Health 18 (1): 73. https://doi.org/10.3390/ijerph18010073.
[xxvi] “The Global South under Debt Distress.” n.d. Accessed December 6, 2022. https://ny.fes.de/article/the-global-south-under-debt-distress. 10:36
[xxviii] “Argentina: Staff Report for 2022 Article IV Consultation and Request for an Extended Arrangement under the Extended Fund-Facility-Press Release; Staff Report; and Staff Supplements.” n.d. IMF. Accessed November 18, 2022. https://www.imf.org/en/Publications/CR/Issues/2022/03/25/Argentina-Staff-Report-for-2022-Article-IV-Consultation-and-request-for-an-Extended-515742. 7-9
[xxix] Ibid., 9
[xxx] Joseph Stiglitz and Mark Weisbrot. 2022. “The IMF’s Agreement with Argentina Could Be a Game Changer.” Center for Economic and Policy Research (blog). March 10, 2022. https://www.cepr.net/the-imfs-agreement-with-argentina-could-be-a-game-changer/.
[xxxi] “Argentina: Staff Report for 2022 Article IV Consultation and Request for an Extended Arrangement under the Extended Fund-Facility-Press Release; Staff Report; and Staff Supplements.” n.d. IMF. Accessed November 18, 2022. https://www.imf.org/en/Publications/CR/Issues/2022/03/25/Argentina-Staff-Report-for-2022-Article-IV-Consultation-and-request-for-an-Extended-515742., page 3
[xxxii] “Country Report Argentina October 2022.” 2022. London: The Economist Intelligence Unit N.A., Incorporated.
[xxxiii] The Economist. 2023. “Argentina and Brazil Propose a Bizarre Common Currency,” January 26, 2023. https://www.economist.com/finance-and-economics/2023/01/26/argentina-and-brazil-propose-a-bizarre-common-currency; Federico Steinberg and Miguel Otero-Iglesias. 2023. “South America’s ‘Common Currency’ Is Actually about De-Dollarization,” February. https://www.csis.org/analysis/south-americas-common-currency-actually-about-de-dollarization.
[xxxiv]The White House. 2023. “Remarks by President Biden and President Alberto Fernández of Argentina Before Bilateral Meeting.” March 29, 2023. https://www.whitehouse.gov/briefing-room/speeches-remarks/2023/03/29/remarks-by-president-biden-and-president-alberto-fernandez-of-argentina-before-bilateral-meeting/.; Ariel González Levaggi. 2023. “More Than a Symbolic Encounter: Fernández-Biden at the White House,” April. https://www.csis.org/analysis/more-symbolic-encounter-fernandez-biden-white-house.; Isabel Bernhard 2023. “The US and Argentine Presidents Left the Most Important Words Unsaid.” Atlantic Council (blog). March 31, 2023. https://www.atlanticcouncil.org/blogs/new-atlanticist/the-us-and-argentine-presidents-left-the-most-important-words-unsaid/.
[xxxv] “Buenos Aires Times | ‘Satisfied’ Fernández Flies Home with Biden’s Vow of Support.” n.d. Accessed April 19, 2023. https://www.batimes.com.ar/news/argentina/satisfied-fernandez-flies-home-with-bidens-vow-of-support.phtml.
[xxxvi] Maia Mindel. 2022. “Going Green.” Substack newsletter. Some Unpleasant Arithmetic (blog). April 5, 2022. https://someunpleasant.substack.com/p/going-green?utm_medium=reader2.
Leave a Reply