Argentina: Geography, Economy, and Globalization

Argentina’s Geographical Extremes

Endpoints:

  • North: Confluence of the Rio Grande and Mojinete, Cerro Branqui (Jujuy)
  • East: City of Bernardo de Irigoyen (Misiones)
  • West: Los Glaciares National Park (Santa Cruz)
  • South: Cape San Pio (Tierra del Fuego)

Attributes of the Argentine State

For the Argentine State to be recognized as such, it must possess the following:

  1. Territory: A defined physical space in which to exercise sovereignty.
  2. Population: People living within the physical space, fostering a sense of belonging and developing economic activities.
  3. Government: To manage and ensure the well-being and security of its inhabitants.
  4. Legal System: To guarantee that each individual can carry out their duties and obligations, and to provide justice.
  5. Natural Resources: To sustain the country and enable it to be free and independent.

Geographical Regions of Argentina

  1. Continental Portion: The southern end of the American continent, a legacy of the Viceroyalty of the Rio de La Plata.
  2. Oceanic Portion: Includes the marine trench, islands, and ocean mass.
  3. Antarctic Portion: Argentina’s claim predates the Antarctic Treaty (1959). Argentina has maintained a presence since 1904, with the establishment of the Orcadas Base.

Argentina in the Global Context

In the 19th century, Britain dominated the world’s economic and political landscape. Argentina was organized as a National Government during this period. By the 20th century (1920), the United States had established itself as a world power. Both the U.S. and the UK experienced significant economic and industrial development, leading them to produce a large number of manufactured goods, from everyday consumer items to machinery and transport (such as trains and ships that benefited global trade).

Their economies were based on the capitalist organization of production, meaning that all elements for the use and production of goods (such as land, raw materials, machinery, and tools) belonged to private owners. Workers carried out production in exchange for a salary. To increase profits, industrialized countries needed new markets and raw materials. Argentina, seeking to engage with these countries, began to provide raw materials.

Argentina in the Neoliberal Era

The main international credit agencies (during the military dictatorship and the restoration of democracy) influenced Argentina’s economic policies. The military government promoted the opening of the economy to international trade by reducing import tariffs for products and implementing free financial exchange. This included eliminating price controls, changing the value of the currency against the dollar, dissolving trade union organizations, and halting wage increases. Monetary policy established a fixed exchange rate between the Argentine currency and the dollar. Sales of domestic industries declined, leading to closures, increased unemployment, and a growing deficit. Restrictions on the entry and exit of capital were removed, and the banking and financial system was liberalized. This resulted in a large influx of money offered at low cost to less developed countries, leading to increased foreign debt.

Global Crisis and Internal Development

The 1929 world crisis occurred because Americans who invested their money in stocks caused this investment to exceed the population’s consumption. Consequently, companies struggled to sell their products, and the economy began to falter. U.S. exports to Argentina, as well as to European countries, began to decline.

The import substitution model involved the provision of basic services by state-owned enterprises. These companies became significant employers due to their high demand for workers. This period, spanning from 1930 to 1975, was characterized by a focus on internal development. Workers conquered their rights during the Peronist government, which allowed the lower classes to access basic services.

The Neoliberal and Globalized World

In 1970, countries began to perceive the existing model of production as outdated. Profits decreased, and the cost of energy products increased.

The Oil Crisis: In 1973, the era of cheap and abundant energy ended. This triggered economic failures as oil-producing countries multiplied their profits. A significant portion of this money flowed into the financial circuit through international banks, creating a large supply of capital for loans with interest. This gave rise to economic neoliberalism (e.g., the Toyota model). This model advocated for a self-regulating market (economically and socially) without state intervention. Policies promoting the free mobility of capital and products were implemented.

In the late 20th century, the term “era of globalization” began to be used to describe the increasing interdependence of the world’s economies. This was supported by increased financial and trade exchange. Transnational corporations played a key role in this process. Technological innovations, such as communications, computing, microelectronics, robotics, and biotechnology, further accelerated globalization.

In 1990, the Internet dramatically increased the speed and scope of globalization. Globalization manifested in various ways. Countries opened their economies with fewer restrictions to international prices and increased competition with local products. Economic policies were also needed to prevent the deterioration of the population’s quality of life.