In May 2018 Argentina has gone cap-in-hand to the IMF for a US$30 billion loan to shore up the peso, after a rise in interest rates to 40 per cent failed to stop the markets selling off the currency. The country’s financial problems started long before the current, pro-market government of Mauricio Macri.
Argentina was once in the top-six largest economies worldwide. Since then, a combination of bad policies, big egos and a craving for control have systemically ensured macro-economic instability laced by corruption, undermining productivity, spurring inflation, weakening growth, and damaging already weak institutions. In Argentina, populist politics has routinely trumped common sense economics.
This Brenthurst Foundation Discussion Paper evaluates the history of populism and politics trumping economic common sense and the prospects of President Macri in putting this right. The question is: Will Argentinians let him?
The Cost of Perónism and Populist Coups: Tough Lessons from Argentina0.45 MB