This week: The economic chaos in Argentina. What to expect from this weekend’s elections in Peru and Ecuador. And how Brazil is delaying vaccine rollouts in Paraguay.
The (latest) economic debacle in Argentina, explained
After a GDP slip of nearly 10 percent in 2020, Argentina has seen poverty rates jump 6.5 points to 42 percent, according to statistics bureau Indec. Over the course of an entire year, one-third of Argentinian households only earn enough to buy the latest iPhone.
Why it matters. Argentina is unlikely to fully recover its 2020 losses this year, which will only compound the country’s misery. Overall poverty levels are increasing at an alarming rate and could surpass those observed after the 2001 economic collapse.
Catch 22. International organizations — even pro-austerity ones — have recommended a hefty dose of fiscal stimulus to provide some economic relief amid the pandemic. For Argentina, where annual inflation tops the 40-percent mark, printing more money can spell trouble.
- Argentina’s central bank debt reportedly increased by 189 percent since President Alberto Fernández took office late in 2019. With benchmark interest rates at 38 percent, interest alone costs USD 10 billion per year. “In other words, for every...