Latin America’s economy has slowed down in country after country in recent years Economic crises that cause poverty among citizens and are an example of economic policies that are unsuccessful. The most recent example of this is Argentina, a place that doesn’t raise its head and where even metal is currently worth more than its currency, the Argentine peso. The culprit is the ever-worsening inflation, which is among the highest in the world.
Is about the worst crisis Argentina has seen since 2002. That year saw a financial situation that severely affected Argentina’s economy for several years, causing it to collapse and GDP to fall drastically, causing the country to slide into recession and plunging more than a third of its population into depression. Poverty and high poverty level of unemployment.
What is happening in Argentina and why is the country in its worst economic situation in two decades?
The present moment has nothing to envy than two decades ago. The price increase is unstoppable at 113.4% year-on-year. Markets are growing suspicious and capital flight is inevitable as the political crisis strains the streets and the country stands on the precipice of social eruption. According to Bloomberg, macroeconomic forecasts put inflation at 142% by the end of 2023.
And the situation has reached such proportions that some Argentines are dissecting their own coins because of the value the metal holds for currency. In social networks the video like A man dissects a two Argentine pesos coin to obtain a ring that can be bought in the market for twelve pesos.
That is, destroying a coin and turning it into metal can increase its value fivefold. That’s exactly what a kid did who decided to sell his life savings as metal and ended up making that profit, local media reported. Something which, although considered a criminal offense under the Criminal Code and punishable by imprisonment for up to five years, Desperation forces the Argentines to seek any solution despite the risk they might take.
Today, It is estimated that 46% of Argentines – almost half of the country’s total population – are officially poorleading to an increase in strange phenomena such as looting of shops and supermarkets, but also the number of applicants for soup kitchens or the lack of food and other basic products.
Argentina is hosting the 2023 presidential election next month. Whatever the outcome, the winner will face an inflationary chasm and the low expectations of the Central Bank of the Argentine Republic, which has been raising inflation forecasts over the months, according to a BCRA Survey of Market Expectations (REM) report Retail price forecast for 2024 raised by 17.5 percentage points, which is now at 107.5%.
