Foreign trade of Argentina
[3] But record taxes on grain exports imposed by the administration of President Juan Perón (1946-55) and an increasing need for costly fuel and machinery helped result in a nearly-unbroken string of trade deficits between 1949 and 1962.
The climate of slack domestic demand that prevailed in Argentina throughout the 1980s resulted in a cumulative US$38 billion in surpluses from 1982 to 1991;[3] this brought the economy little direct benefit, however, as much of this was deposited abroad during that era of interest payment burdens and financial instability.
[5] Economy Minister Domingo Cavallo enacted the Convertibility Law of 1991, pegging the monetary value of the Argentine peso to the United States dollar.
Taking advantage of this low exchange rate, on the lower tariffs on imports and on the reappearance of credit after the free trade liberalization measures taken by President Carlos Menem's administration, Argentine firms and consumers tripled capital goods purchases from 1990 to 1994, while depressed auto sales rose by fivefold.
[6] Relying on sizable foreign investment inflows to balance the current account, these did not suffice and the Central Bank was again forced to resort to borrowing to protect the peso's value against such pressure (mostly by floating bonds, then the most sought-after in the developing world).
Buffeted by generalized global instability and mounting capital flight, international markets massively shorted Argentine bonds in the second half of 2001 and on December 23, following a spate of unpopular crisis measures, the Argentine government declared a default on US$85 billion of its bonds - the largest sovereign debt default in history.
As recovery ensued and the exchange rate stabilized around 3 pesos/dollar, exports (mainly soy, cereals and other agricultural products, as well as machinery and fuels) grew steadily.
Imports began recovering sharply in 2003, as both the purchasing power of the peso and domestic demand increased, and, despite this, from 2003 to 2011 the nation's merchandise trade balance recorded a cumulative US$115 billion in surpluses.
[6] Argentine goods and services trade balances, and foreign debt, 1970-2022 (million US$): [3][5][6][17][18][19] Mercosur—the customs union that includes Argentina, Brazil, Paraguay, and Uruguay—entered into force January 1, 1995; Bolivia, Chile, and Venezuela joined the pact subsequently as associate members.
Following the 2001-02 crisis, Argentina's recovering industrial sector has pressured the government to obtain restrictions (especially quotas) on Mercosur's free trade regulations, in order to protect their growth from what they see as disloyal competition from their larger partner to the north.
Exports to Brazil helped lessen the impact of the crisis on the industrial sector somewhat, though Argentina's intra-Mercosur trade yielded it a cumulative US$15 billion deficit from 2004 to 2008.
[23] China has become the largest investor in Argentina's growing lithium mining sector,[24] which by 2030 is projected by JPMorgan Chase to become the second-largest in the world - only behind Australia.
[4] The U.S. share of imports and exports remained relatively stable at around 20% and 10%, respectively, until 2002; these proportions declined steadily afterward and by 2010, were approximately half the historical percentages.
[29] The Obama administration suspended Argentine participation in the Generalized System of Preferences (GSP) in 2012, citing a failure to pay arbitration payments awarded by the World Bank's ICSID to a number of U.S. firms adversely impacted by the 2002 devaluation of the peso.
[6] Argentina has a thriving and longstanding trade relationship with the European Union, as well as close historic and cultural ties dating to the colonial era that spanned 300 years until independence in 1816.
European investment and immigration dramatically reshaped Argentina after 1880 - and the British Empire in particular dominated Argentine trade with over a third of the total until World War I, buying mainly meats and cereals in exchange for a wide variety of consumer and industrial goods.
