Miss dollars. Why does the Argentinean economy always hit the same stone

Beyond the economic situation, marked by the recession and the high rate of

l & # 39; inflation

Argentina has been dragging the problem of currency generation for decades. Even with different approaches, some more interventionist, others closer to the free market idea, successive governments could not or did not know how to solve this lack that limited development. The search for answers, according to badysts consulted by
THE NATION, begins in five potentially competitive productive sectors globally. The road, however, requires long-term policies, those that the country postpones successively before each crisis.

"There is a macroeconomic equation according to which the

Argentina

this does not solve and it is the external restriction generated by the scarcity of currencies. Whenever the country grows, imports increase more than proportionately, which slows down activity, sometimes abruptly, as was the case in 2018. The resolution of the problem via exports is one central elements of any growth potential ", illustrates the economist Daniel Heymann, researcher and teacher at the

University of Buenos Aires

(UBA).

According to the archives of

Indec

In the last ten years, Argentina's sales abroad have decreased by 17%, while overseas purchases have increased by 16%. The momentum is reversed from the last months of 2018, with the dollar's surge and the recession leading to a drop in imports. Along with the increase of the commercial red, the current account deficit has widened (which takes into account all transactions of goods and services of the country with the world). That is to say, the gap between the dollars generated and demanded by the entire Argentine economy has widened. In 2018, it reached 5.4% of gross domestic product (GDP) and rose to about 28,000 million US dollars.

The difficulty in generating currency, defined by economist Eduardo Levy Yeyati in a recent interview with
THE NATION as
The "Achilles heel" of the Argentine economy is at the base of the constant cycles of growth and crisis that harbad the country since the 20th century. "Since the new world order after the Second World War, Argentina has experienced 16 recessive episodes that have resulted in 26 years of declining activity, that is to say, that it there was one over three years with contraction, "said Martin badtti, director of economic development. from Cippec.

"Of these recessions, 15 are due to the balance of payments crisis because the country is short of dollars," adds the economist, about the cycles of economic growth that have led to an increase in imports (goods of consumption, machinery) and an additional brake due to a shortage of dollars leading to a rise in the exchange rate, an acceleration in domestic prices, a drop in the level of activity and an improvement in competitiveness favoring exports.

In 2018, the reduction in external credit highlighted the vulnerabilities of the Argentine macroeconomy and motivated an exchange rate jump which, combined with the tightening of measures to reduce public spending, will reduce the current account deficit to a level close to that of 2% of GDP (10 billion USD), according to estimates of the EcoGo study. On the other hand, there may be an acceleration of inflation which, after 47.6% in 2018, would exceed 36% this year, two consecutive years of declining activity and rising level unemployment and poverty.

According to badtti,
the dollar is the key factor of the oscillations. "There is a structural conflict of distribution in the economy and the variable that reflects it is the real exchange rate or the dollar wage. [del tipo de cambio real] for the economy to develop without external problems, it is superior to that which society needs to satisfy its material needs. This conflict between aspirations and productive capacity means that the economy constantly interrupts the processes of growth. It is not that Argentina has no potential; it is impossible to generate a certain consensus. "

In addition to internal weaknesses, factors such as the 2018 drought or the economic crisis in Brazil, Argentina's largest trading partner and the destination of 37% of manufactured exports last year, compounded the problem. .

"The art of this problem would be to find potential exports that, because of their competitiveness and high productivity, do not need a very low real wage in dollars." The more we produce products and services we will be able to offer to the world, the more productive we will be – sustainable dollar wages, "says Heymann.