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1 [1] (April 26, 2019)

handle is hein.crs/govzmk0001 and id is 1 raw text is: Updated April 26, 2019 Argentina: An Overview Political and Economic Environment Current President Mauricio Macri-leader of the center- right Republican Proposal and the Cambiemos (Let's Change) coalition representing center-right and center-left parties-won the 2015 presidential election in a close race. Macri defeated the candidate of the leftist faction (Front for Victory, or FPV) of the Peronist party (officially known as the Justicialist Party) led by outgoing President Cristina Fernlidez de Kirchner, who was ineligible to run for a third consecutive term. Mach's election ended 12 years of FPV rule by the Kirchners (N6stor Kirchner, 2003-2007, and Cristina FernAndez, 2007-2015). The Kirchners' rule helped Argentina emerge from a severe economic crisis in 2001- 2002 but was characterized by protectionist and unorthodox economic policies and increasing corruption. Source: CRS. President Macri moved swiftly to usher in economic policy changes. His government lifted currency controls; reduced or eliminated agricultural export taxes; and reduced electricity, water, and heating gas subsidies. The government reached a deal with private creditors in 2016 that ended the country's 15-year default, which allowed the government to repair its rogue debtor status and resume borrowing in international capital markets. Although adjustment measures contributed to almost 2.1% economic contraction in 2016, the economy grew by 2.7% in 2017, according to the International Monetary Fund (IMF). In Argentina's October 2017 midterm legislative elections, in which one-third of the Senate and one-half of the Chamber of Deputies were at stake, Mach's coalition made significant gains but did not win a majority in either chamber. Following the election, President Macri successfully moved tax and pension legislation through Congress despite protests. Argentina at a Glance Population: 44.6 million (2018, IMF est.). Area: 1.1 million square miles, about the size of the United States east of the Mississippi. GDP: $518 billion (2018, current prices, IMF est.). Real GDP Growth: 2.7% (2017, IMF est.); -2.5% (2018, IMF est.). Per Capita GDP: $11,627 (2018, current prices, IMF est.). Key Trading Partners (total trade): Brazil (21.1o), China (12.800), United States (9.3%) (2018, INDEC). Legislature: Bicameral Congress, with 72-member Senate and 257-member Chamber of Deputies. Sources: International Monetary Fund (IMF) and National Institute of Statistics and Census, (INDEC, Argentina). In early 2018, the IMF was forecasting almost 2% growth for the year, but Argentina's economic difficulties, including a severe drought affecting agricultural exports, thwarted those expectations. The economy ultimately contracted 2.5% in 2018. Looking ahead, the IMF's projection for 2019 is a contraction of 1.2%, and for 2020 a growth rate of 2.2%. Inflation was almost 25% at the end of 2017, rose to almost 48% at the end of 2018, and in March 2019 reportedly rose to almost 55% year-on-year. As pressure on the peso increased in April 2018, the government turned to the IMF for support. The IMF approved a three-year, $50 billion program in June; as the economy continued to decline, the government reached a revised agreement with the IMF in September 2018, increasing its total support to about $57 billion through 2021. Despite wide-scale protests over austerity measures in the second half of 2018, the Macri government secured legislative approval in November for spending cuts and tax increases required under the IMF program. The IMF has conducted three performance reviews of Argentina's progress under the program; the most recent in April 2019 noted that a key priority is protecting the most vulnerable from the impact of the recession and from high inflation. More recently, Argentina's economic turbulence has taken a toll on President Mach's popularity, which could threaten the president's bid for reelection in October 2019. Some polls from April 2019 show that former President Cristina FernAndez could defeat Macri in a second round. FernAndez, however, is also reported to have high negative ratings, likely because of pending corruption charges. Some observers contend that a single centrist Peronist candidate could pose a strong bid for the presidency; potential

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