Argentina: 2016 Article IV Consultation-Press Release; Staff Report; and Statement by the Executive Director for Argentina
IMF Staff Country Reports, November 10, 2016
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- Argentina: 2016 Article IV Consultation-Press Release; Staff Report; and Statement by the Executive Director for Argentina
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Bibliographic details
- Published: November 10, 2016
- Series: IMF Staff Country Reports
- DOI: https://doi.org/10.5089/9781475552621.002
Executive summary and macroeconomic diagnosis
- Upon taking office in December last year, Argentina’s new government faced pervasive macroeconomic imbalances, microeconomic distortions, and a weakened institutional framework.
- Macroeconomic imbalances identified:
- Unsustainably high consumption levels.
- Historically low levels of investment.
- Large fiscal deficits financed by money creation, which led to high inflation.
- Microeconomic distortions identified:
- Extensive network of administrative controls, for example: trade barriers, foreign exchange restrictions, and price controls.
- A business environment that eroded competitiveness and undermined medium-term growth.
- Institutional weaknesses:
- Important weakening of the institutional framework for economic policymaking.
- Loss of credibility of the national statistics agency.
Key findings and thematic issues
- Fiscal and monetary interactions:
- Large fiscal deficits financed by money creation contributed directly to high inflation.
- Growth and competitiveness:
- Historically low investment and administrative market distortions undermined medium-term growth prospects.
- Structural and regulatory constraints:
- Trade barriers, foreign exchange restrictions, and price controls were highlighted as significant microeconomic distortions.
- Institutional credibility:
- The weakened institutional framework—most notably the national statistics agency’s loss of credibility—was emphasized as a major policy challenge.