Argentina Essay -- essays research papers

I. INTRODUCTION genus genus Argentina lives in a democracy since 1986. Before thisyear lived it under a military regime. In the nineties under the presidency ofMenem the commonwealth experienced a great increase in the liberalization of portion out.Argentina has a free market economic system. Due to the recent privatizationprogram, the State today has a very limited role in the economy. According tothe scrap Report of the World Economic Forum Argentina isclassified as wiz of the most open, least protectionist countries in the world.Its currency is convertible to the US dollars and there is heart and soul freedom formoving capital internationally. Argentina has conducted one of the mostintensive privatization programs in the world. The telephone comp any(prenominal),airlines, most railroads, electric part ware companies (includinghydroelectric power plants), the Argentine oil company YPF (bought by theSpanish company Repsol) steel mills, ports, TV stations and most worldserv ices were transferred recently to the private sector. Consistent withFundacion Invertir the combined value of privatized firms amounts more(prenominal) tomore than US$ 30 billions. Many foreign firms have participated in thislarge-scale privatization program. Foreign investors do not need to seek anykind of prior approval and ar free to repatriate undecomposed amount of their capitaland earnings any time. Foreign and domestic companies argon treated equally.Under the law, they have access to all economic sectors and are eligible forincentive program and state procurement. II. TRADE PATTERN It is unsaidto state the type of trade that exists amidst Argentina and Brazil in theautomobile industry because both countries import and export cars of thesame put up and very similar models. Volkswagen produces virtually of itsmodel of cars in Argentina and some others model in Brazil. The reason forthis is to achieve economies of scale each country specializes in a certainmodel of car, by doing so they drop the cost of each additional unit.Another reason for specialization of production in each country is that it mightbe cheaper to produce a certain model in either Argentina or Brazil. some(prenominal)companies as Volkswagen have invested in production facilities in Mercosur.Additionally, joint ventures between local and foreign parts manufacturershave improved quality. A piece on Argentina auto parts/services announcedthat loca... ...stment payments, and transfers.Argentina has generally maintained a deficit position in trade in services, andhas historically paid out more investment income than it has received, propertyits finances on edge. Countries whose foreign direct investments keeps upwith its domestic harvest-feast can afford such disparities. Nevertheless Argentinasdeficit current level shows that the economy might be hurt even more bycapital flight. Thus the development of exports, especially nontraditional ones,is taking on greater urgency. In re cent years exports of manufacturedproducts increased at respectable rates. "In 1995 industrial products grew 40percent while radical products and manufactured agricultural products eachgrew 29 percent. In 1996, exports of industrial products diminish 0.6percent, primary products grew 21 percent, and manufactured agriculturalproducts 13 percent. In 1997, exports of industrial products grew 27percent, and manufactured agricultural products 7 percent, however theprimary products decreased 2.4 percent. Imports of capital goods and partsare a major component of total imports, which are being used to increaseproductivity." (Fundacion Invertir)