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Argentina vs. Brazil

Economy

ArgentinaBrazil
Economy - overview

Argentina benefits from rich natural resources, a highly literate population, an export-oriented agricultural sector, and a diversified industrial base. Although one of the world's wealthiest countries 100 years ago, Argentina suffered during most of the 20th century from recurring economic crises, persistent fiscal and current account deficits, high inflation, mounting external debt, and capital flight.

Cristina FERNANDEZ DE KIRCHNER succeeded her husband as president in late 2007, and in 2008 the rapid economic growth of previous years slowed sharply as government policies held back exports and the world economy fell into recession. In 2010 the economy rebounded strongly, but slowed in late 2011 even as the government continued to rely on expansionary fiscal and monetary policies, which kept inflation in the double digits.

In order to deal with these problems, the government expanded state intervention in the economy: it nationalized the oil company YPF from Spain's Repsol, expanded measures to restrict imports, and further tightened currency controls in an effort to bolster foreign reserves and stem capital flight. Between 2011 and 2013, Central Bank foreign reserves dropped $21.3 billion from a high of $52.7 billion. In July 2014, Argentina and China agreed on an $11 billion currency swap; the Argentine Central Bank has received the equivalent of $3.2 billion in Chinese yuan, which it counts as international reserves.

With the election of President Mauricio MACRI in November 2015, Argentina began a historic political and economic transformation, as his administration took steps to liberalize the Argentine economy, lifting capital controls, floating the peso, removing export controls on some commodities, cutting some energy subsidies, and reforming the country’s official statistics. Argentina negotiated debt payments with holdout bond creditors, continued working with the IMF to shore up its finances, and returned to international capital markets in April 2016.

In 2017, Argentina’s economy emerged from recession with GDP growth of nearly 3.0%. The government passed important pension, tax, and fiscal reforms. And after years of international isolation, Argentina took on several international leadership roles, including hosting the World Economic Forum on Latin America and the World Trade Organization Ministerial Conference, and is set to assume the presidency of the G-20 in 2018.

Brazil is the eighth-largest economy in the world, but is recovering from a recession in 2015 and 2016 that ranks as the worst in the country’s history. In 2017, Brazil`s GDP grew 1%, inflation fell to historic lows of 2.9%, and the Central Bank lowered benchmark interest rates from 13.75% in 2016 to 7%.

The economy has been negatively affected by multiple corruption scandals involving private companies and government officials, including the impeachment and conviction of Former President Dilma ROUSSEFF in August 2016. Sanctions against the firms involved — some of the largest in Brazil — have limited their business opportunities, producing a ripple effect on associated businesses and contractors but creating opportunities for foreign companies to step into what had been a closed market.

The succeeding TEMER administration has implemented a series of fiscal and structural reforms to restore credibility to government finances. Congress approved legislation in December 2016 to cap public spending. Government spending growth had pushed public debt to 73.7% of GDP at the end of 2017, up from over 50% in 2012. The government also boosted infrastructure projects, such as oil and natural gas auctions, in part to raise revenues. Other economic reforms, proposed in 2016, aim to reduce barriers to foreign investment, and to improve labor conditions. Policies to strengthen Brazil’s workforce and industrial sector, such as local content requirements, have boosted employment, but at the expense of investment.

Brazil is a member of the Common Market of the South (Mercosur), a trade bloc that includes Argentina, Paraguay and Uruguay - Venezuela’s membership in the organization was suspended In August 2017. After the Asian and Russian financial crises, Mercosur adopted a protectionist stance to guard against exposure to volatile foreign markets and it currently is negotiating Free Trade Agreements with the European Union and Canada.

GDP (purchasing power parity)
$922.1 billion (2017 est.)
$896.5 billion (2016 est.)
$913.2 billion (2015 est.)

note: data are in 2017 dollars

$3.248 trillion (2017 est.)
$3.216 trillion (2016 est.)
$3.332 trillion (2015 est.)

note: data are in 2017 dollars

GDP - real growth rate
2.9% (2017 est.)
-1.8% (2016 est.)
2.7% (2015 est.)
1% (2017 est.)
-3.5% (2016 est.)
-3.5% (2015 est.)
GDP - per capita (PPP)
$20,900 (2017 est.)
$20,600 (2016 est.)
$21,200 (2015 est.)

note: data are in 2017 dollars

$15,600 (2017 est.)
$15,600 (2016 est.)
$16,300 (2015 est.)

note: data are in 2017 dollars

GDP - composition by sector
agriculture: 10.8% (2017 est.)
industry: 28.1% (2017 est.)
services: 61.1% (2017 est.)
agriculture: 6.6% (2017 est.)
industry: 20.7% (2017 est.)
services: 72.7% (2017 est.)
Population below poverty line
25.7% (2017 est.)

note: data are based on private estimates

4.2% (2016 est.)

note: approximately 4% of the population are below the "extreme" poverty line

Household income or consumption by percentage share
lowest 10%: 1.8%
highest 10%: 31% (2017 est.)
lowest 10%: 0.8%
highest 10%: 43.4% (2016 est.)
Inflation rate (consumer prices)
25.7% (2017 est.)
26.5% (2016 est.)

note: data are derived from private estimates

3.4% (2017 est.)
8.7% (2016 est.)
Labor force
18 million (2017 est.)

note: urban areas only

104.2 million (2017)
Labor force - by occupation
agriculture: 5.3%
industry: 28.6%
services: 66.1% (2017 est.)
agriculture: 9.4%
industry: 32.1%
services: 58.5% (2017 est.)
Unemployment rate
8.4% (2017 est.)
8.5% (2016 est.)
12.8% (2017 est.)
11.3% (2016 est.)
Distribution of family income - Gini index
41.7 (2017 est.)
45.8 (2009)
49 (2014)
54 (2004)
Budget
revenues: 120.6 billion (2017 est.)
expenditures: 158.6 billion (2017 est.)
revenues: 733.7 billion (2017 est.)
expenditures: 756.3 billion (2017 est.)
Industries
food processing, motor vehicles, consumer durables, textiles, chemicals and petrochemicals, printing, metallurgy, steel
textiles, shoes, chemicals, cement, lumber, iron ore, tin, steel, aircraft, motor vehicles and parts, other machinery and equipment
Industrial production growth rate
2.7% (2017 est.)

note: based on private sector estimates

0% (2017 est.)
Agriculture - products
sunflower seeds, lemons, soybeans, grapes, corn, tobacco, peanuts, tea, wheat; livestock
coffee, soybeans, wheat, rice, corn, sugarcane, cocoa, citrus; beef
Exports
$58.45 billion (2017 est.)
$57.78 billion (2016 est.)
$217.2 billion (2017 est.)
$184.5 billion (2016 est.)
Exports - commodities
soybeans and derivatives, petroleum and gas, vehicles, corn, wheat
transport equipment, iron ore, soybeans, footwear, coffee, automobiles
Exports - partners
Brazil 16.1%, US 7.9%, China 7.5%, Chile 4.4% (2017)
China 21.8%, US 12.5%, Argentina 8.1%, Netherlands 4.3% (2017)
Imports
$63.97 billion (2017 est.)
$53.5 billion (2016 est.)
$153.2 billion (2017 est.)
$139.4 billion (2016 est.)
Imports - commodities
machinery, motor vehicles, petroleum and natural gas, organic chemicals, plastics
machinery, electrical and transport equipment, chemical products, oil, automotive parts, electronics
Imports - partners
Brazil 26.9%, China 18.5%, US 11.3%, Germany 4.9% (2017)
China 18.1%, US 16.7%, Argentina 6.3%, Germany 6.1% (2017)
Debt - external
$214.9 billion (31 December 2017 est.)
$190.2 billion (31 December 2016 est.)
$547.4 billion (31 December 2017 est.)
$548.6 billion (31 December 2016 est.)
Exchange rates
Argentine pesos (ARS) per US dollar -
16.92 (2017 est.)
14.76 (2016 est.)
14.76 (2015 est.)
9.23 (2014 est.)
8.08 (2013 est.)
reals (BRL) per US dollar -
3.19 (2017 est.)
3.48 (2016 est.)
3.4901 (2015 est.)
3.3315 (2014 est.)
2.3535 (2013 est.)
Fiscal year
calendar year
calendar year
Public debt
57.6% of GDP (2017 est.)
55% of GDP (2016 est.)
84% of GDP (2017 est.)
78.4% of GDP (2016 est.)
Reserves of foreign exchange and gold
$55.33 billion (31 December 2017 est.)
$38.43 billion (31 December 2016 est.)
$374 billion (31 December 2017 est.)
$367.5 billion (31 December 2016 est.)
Current Account Balance
-$31.32 billion (2017 est.)
-$14.69 billion (2016 est.)
-$9.762 billion (2017 est.)
-$23.55 billion (2016 est.)
GDP (official exchange rate)
$637.6 billion (2017 est.)
$2.055 trillion (2017 est.)
Stock of direct foreign investment - at home
$76.58 billion (31 December 2017 est.)
$72.11 billion (31 December 2016 est.)
$778.3 billion (31 December 2017 est.)
$703.3 billion (31 December 2016 est.)
Stock of direct foreign investment - abroad
$40.94 billion (31 December 2017 est.)
$39.74 billion (31 December 2016 est.)
$358.9 billion (31 December 2017 est.)
$341.5 billion (31 December 2016 est.)
Market value of publicly traded shares
$56.13 billion (31 December 2015 est.)
$60.14 billion (31 December 2014 est.)
$53.1 billion (31 December 2013 est.)
$642.5 billion (31 December 2017 est.)
$561.1 billion (31 December 2014 est.)
$420 billion (31 December 2013 est.)
Central bank discount rate

NA

7% (31 December 2017 est.)
13.75% (31 December 2016)
Commercial bank prime lending rate
26.58% (31 December 2017 est.)
31.23% (31 December 2016 est.)
46.92% (31 December 2017 est.)
52.1% (31 December 2016 est.)
Stock of domestic credit
$219.4 billion (31 December 2017 est.)
$194 billion (31 December 2016 est.)
$2.206 trillion (31 December 2017 est.)
$2.138 trillion (31 December 2016 est.)
Stock of narrow money
$62.61 billion (31 December 2017 est.)
$59 billion (31 December 2016 est.)
$110.3 billion (31 December 2017 est.)
$106.7 billion (31 December 2016 est.)
Stock of broad money
$62.61 billion (31 December 2017 est.)
$59 billion (31 December 2016 est.)
$110.3 billion (31 December 2017 est.)
$106.7 billion (31 December 2016 est.)
Taxes and other revenues
18.9% (of GDP) (2017 est.)
35.7% (of GDP) (2017 est.)
Budget surplus (+) or deficit (-)
-6% (of GDP) (2017 est.)
-1.1% (of GDP) (2017 est.)
Unemployment, youth ages 15-24
total: 22.6%
male: 19.9%
female: 26.9% (2017 est.)
total: 28.5%
male: 25.3%
female: 32.8% (2018 est.)
GDP - composition, by end use
household consumption: 65.9% (2017 est.)
government consumption: 18.2% (2017 est.)
investment in fixed capital: 14.8% (2017 est.)
investment in inventories: 3.7% (2017 est.)
exports of goods and services: 11.2% (2017 est.)
imports of goods and services: -13.8% (2017 est.)
household consumption: 63.4% (2017 est.)
government consumption: 20% (2017 est.)
investment in fixed capital: 15.6% (2017 est.)
investment in inventories: -0.1% (2017 est.)
exports of goods and services: 12.6% (2017 est.)
imports of goods and services: -11.6% (2017 est.)
Gross national saving
17.6% of GDP (2017 est.)
16.8% of GDP (2016 est.)
15.8% of GDP (2015 est.)
15% of GDP (2017 est.)
14.1% of GDP (2016 est.)
14.1% of GDP (2015 est.)

Source: CIA Factbook