An analysis of the major causes of the decline in the Argentinean economy, focusing on the fixed exchange rate system of the country which seems to be the major cause of the problem, forming unrealistic expectations.
The following paper examines the economic strategies adopted by the past Argentinian governments and the loop holes in their economic plans that led to such an economic disaster. This essay also examines the impact of the fixed exchange rate strategy adopted by the government of Argentina over the past few years.The writer uses some quantitative approaches to analyze the economic slowdown in Argentina and how it has affected the market conditions and what impact it has made on the standard of livings of a common man.
“Due to the unrealistic economic policies and unwise decisions made by the government, the Argentinean economy is going through the worst times of its history. The general public is holding the government responsible for the worsening economic crises that have led to high rate of unemployment and decline in trade activities. The current economic crises are believed to be the worst economic decline since the economic crisis of the 1980s. The credit ratings agencies and several other economic forecasters have warned that Argentina is currently facing a threat of getting defaulted on its $132bn of debt. Due to the economic slowdown and the political unrest, created by the economic crisis, it is much likely that the government of Argentina will not be able to arrange the short term repayments for its debts.”