OECD Economic Surveys: Argentina 2019
Over many decades, Argentina’s economy has been held back by weak policy settings
and productivity has stagnated. Recent and additional reforms will help to raise prosperity
for all Argentinians in the medium term. Strengthening competition by reducing barriers
to market entry and foreign trade has particularly high payoffs. Tariff barriers have
prevented a stronger integration into the world economy, which could raise consumer
purchasing power, reduce the cost of firms’ inputs and lead companies in shielded
sectors to become more productive. Currently, many jobs are trapped in activities
with limited potential for productivity and wage growth. As job reallocation can result
in temporary income losses, policies should ease the transition by enhancing training
and social protection. Social policies are effective in reducing inequalities and
poverty continued its declining trend during 2016 and 2017, until a severe economic
crisis pushed the economy into a deep recession in 2018. This has shifted the immediate
policy focus to restoring confidence and unwinding significant fiscal and external
imbalances. Swift and decisive policy responses were necessary and their implementation
will lay the grounds for a return of macroeconomic stability and a recovery from the
recession, although significant risks remain.
SPECIAL FEATURE: FOSTERING INTEGRATION INTO THE WORLD ECONOMY
Published on March 27, 2019Also available in: Spanish, French
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