Ever notice nothing is ever said in the mainstream media about Argentina’s economy, save that it had a big default? You’d never know the following about Argentina: From 2002 onward, Argentina has grown nearly twice as fast as Brazil, and has sported one of the highest growth rates in the world.
Its success is not dependent on a commodities boom.
It has increased social spending from 10.3% of GDP to 14.2% of GDP.
Inequality has fallen. Poverty and extreme poverty have fallen by roughly 2/3.
What is particularly striking is how quickly Argentina’s economy rebounded after its default. From a paper by Mark Weisbrot, Rebecca Ray, Juan A. Montecino, and Sara Kozameh (hat tip reader Thomas Ross):
In December of 2001, the government defaulted on its debt, and a few weeks later it abandoned the currency peg to the dollar. The default and devaluation contributed to a severe financial crisis and a sharp economic contraction, with GDP shrinking by about 5 percent in the first quarter of 2002 and nearly 11% for the full year. However, recovery began after that one quarter of contraction, and continued until the world economic slowdown and recession of 2008-2009. The economy then rebounded, and the IMF now projects growth of 8 percent for 2011.
