External debt stigma
• Argentina’s external debt increased its value from US$ 8000 millions in 1976 to US$137.113 millions in 2008 passing through a US$190.000 millions debt in 2002.
• In 2005 Economy Minister Roberto Lavagna, restructured the debt and the 76 percent of bond holders accepted taking the 55 percent of their defaulted bonds.
• In 2006 FMI´s debt was cancelled after president, Néstor Kirchner, used Central Bank’s reservations to pay a US$ 9810 millions debt to the organization.
• Argentina owes US$ 6670 millions to the Paris Club. The debt was about to be cancelled when global crisis exploded and moved Government’s attention away from this subject.
• Holdouts debt is about US$ 31.000 millions.
• Insolvency fears disappeared after Government fixed a local exchange over guaranteed loans this year. The negotiation with banks and insurers postponed 2009 and 2011 expirations.

2009 elections
• 127 deputies banking up from 256 and 24 up from 72 senators banking will be renewed this year. The elections are a kind of thermometer for 2011 presidential´s, as those who do not win places now, won’t be able to fight then.
• Even Cristina Kirchner won 2007 presidential elections with the 45 percent of the votes people’s intention is now down the 30 percent, and president’s image continues falling. 2009 legislative elections, which will take place in October, have just the opposite perspectives the Kirchner couple imagine would have.
• Julio Cobos, the current vice president, expressed his support for Ernesto Sanz and already announced he will present its own lists in Mendoza. Carlos Reutemann –who said he will stand for 2011´s-, competes with Rubén Giustiniani in Santa Fe. The three governors José de la Sota (Córdoba), Mario das Neves (Chubut) and José Luis Gioja (San Juan) wait for the results in there provinces as they will also stand for presidential´s.
• County town alternatives, which vote for national deputies and will renew half of its legislative body, will be an important signal for Mauricio Macri and Elisa Carrió.
• The most important battle will take place in Buenos Aires province as it represents the 40 percent of the votes.

Inflation, latent problem
• Devaluation processes and currency changes are a constant problem in Argentina. The country passed through several stages: “Rodrigazo” in 1975, the “tablita” and several “hiper” inflations in the 80´s. After entering the convertibility process inflation problems started to cause Argentina’s worst external debt crisis ever.
• The INDEC (National Institution of statistics and census of Argentina Republic) numbers are still in doubt. Even the organization said 2009´s prices rise will be near the 7,2 percent, private estimations talk about the 15 percent. Government sources said rise will be of an 8 percent.
• Economists say stagflation risks, which appeared not only because of global crisis and drought consequences but also because of statistics manipulations and provisional reforms, are of a 100 percent.
• Dollar, one of inflation’s most important indicators, is expected to float between $3,6 and $4,4 in 2009.

The stone in the road: legal insecurity
• With 2, 9 points, from a scale that goes from 1 to 10, Argentina has the 109 place in the corruption ranking up from 180 countries.
• Investors risk perception rise in the last years thanks to the expropriations, interventions and questioning nationalize Government did.
• One of the Government’s last conflicts had to do with the Spanish company, Marsans, who demanded the country in the ICSID (International Centre for Settlement of Investment Disputes) after the Government expropriated Aerolíneas Argentinas and subsidiaries. Argentina sums with this one 34 trials in the organization.

Black economy
• Informal activity moves more than $9500 millions per year in our country.
• Software (75 percent), Films (68 percent), Music (60 percent) and Clothing (50 percent) are the most affected industries.
• 6 up from 10 citizens are disposed to buy products valued in half the price it’s original.
• Every year cd industry looses about US$1184 millions, cigarettes industry looses US$137 millions and clothing industry looses US$110 millions thanks to piracy.
• Up from an occupied population of 10,2 millions people, 3,7 millions argentines work in illegal conditions. Even Government’s tried to eradicate this problem the sector is affected in a 36, 5 percent. Still, private’s estimations are near the 43 percent.
• With 15.000 stands and takings of US$9 millions only in clothing sells, “La Salada” is Argentina’s most important illegal market.

Energetic crisis, today’s bread tomorrow’s hunger?
• In order to avoid energetic problems the Government managed its own prices, far from those the rest of the countries did. But this measurement based on “today’s bread, tomorrow’s hunger” premise made oil’s production declension and infrastructure investments stagnation which had to be covered by Government.
• Even global crisis will reduce energy demands, energetic problems still worry experts. Gas is the country’s first energetic source; its reservations are estimated to last for 9 years. The number fell more than a 50 percent in the last eight years.
• Petroleum proved reservations are of 415.913 millions of m3. As a result of withholdings, the lack of investments and prices distortions, petroleum’s production is falling since 1998. If everything continues going this way, in 3 or 4 years long, Argentina could turn to be an oil-importing country.
• By the beginning of the year electricity bills brought an increscent of a 400 percent, and even more in exceptional cases. The Government only talked about an increscent of a 10 or 30 percent.

The key of  K power
• During 2008 the Government spent $34.295 millions in subsidies. But, global and local crisis will force him to stop these measurements. The, until now, most favoured sectors, Energy and Transportation, are expected to be the most affected.
• AFJPs nationalize gave the ANSeS an extra flux of $ 15.000 millions a year. This will be destined to economy’s $ 13.200 reactivation program, and other purposes.
• Argentina’s budget predicts a spending of $253.483,7 millions this year. Public spending raised a 32 percent in 2008 and continues growing in rates over the ones the country had during the 90´s.

Handbrake
• Global crisis made Argentina enter an important recession process. Reservations are expected to be of US$45.000, an inflation level in between the 14 and the 18 percent, a dollar near or over the $4 and a PBI fall of the 3 percent, by the end of the year. Economists say this will be the country’s worst economic year after 2002 crisis.
• Agricultural manufactures represent a 35 percent of Argentina’s exportations while those of industrial origin represent the 31 percent.
• The country imports intermediate goods in a 35 percent.
• Even in 2008 commercial surplus was a record, during the last two months of that year it started showing crisis effects. In December exportations registered the worst fall since 1991 and importations it’s biggest since 2002.
• Brazil exportations, Argentina’s most important commercial partner in Mercosur, fall a 46,1 percent by 2008. Argentina also bought a 50,8 percent less to that country.

No place in the world
• Argentina’s international relationships are clearly inclined to Venezuela, probably the only relationship cultivated by the Kirchner couple which is based mostly on the financing Hugo Chavez gave to the country; and to a weak Mercosur who did not resolve its institutionalization and renewal neither the integration program.
• United States: the relation with this country turned to be completely controversial since Cristina Kirchner became president. Even she is now trying to improve the dialogue with new president Obama the truth is Buenos Aires did not appear in his list of calls in the day of his assumption.
• Bolivia: above the Kirchner´s sympathy with Evo Morales, Argentina still has a dependent relationship because of gas supply.
• Uruguay: the relationship entered a special phase when Paper Mill Botnia´s conflict started. There have been road cuts in Gualeguaychú and bridges blockades. The conflict resolution and the following bilateral relationship repair are still unresolved.
• Spain: the Kirchner´s public services measurements (YPF, Aerolíneas Argentinas) made the relationship tremble. Cristina Kirchner has recently travelled there in order to fix country’s bonds with Zapatero´s government.
• Cuba: ours it is more a political than an economic association. Cristina Kirchner visited La Habana and had a meeting with Raúl and then with Fidel Castro. Rumours say Cristina´s intention is to become a speaker between Cuba and the United States. Meanwhile, Hilda Molina´s case continues unresolved.
• Brazil inclinations to global and foreign investments made him take a different way from Argentina´s. Even there are no conflicts with Lula´s country, the relationship with Argentina lost the intensity expected.

The country, the new conflict
• Drought was the last subject that made the Government and the country confront. Its consequences obliged the government pronounce an agricultural emergency state for six months. By this edition closure Buenos Aires, Corrientes, Entre Ríos and Chaco have already declared their emergency state.
• Farmers think the emergency state declaration is not enough. They also ask for retentions suspension, a measurement vicepresident Julio Cobos and Santa Fe´s governor, Hermes Binner, also support. The retentions suspension could have a cost of $10.000 millions.
• 1,6 PBI points , 22.400.000 tons less than the 90 million of 2008 and an income fall of $43.000 (US$ 12.300), was the impact drought had over the economy.
• The cattle industry is also in danger. After President Néstor Kirchner closed exportations and imposed prices controls, for years ago, foreign sales fall about a 45 percent. Its stock fell 1,3 millions during the last year. If everything continues like this the country will have to start importing meat.
• Soy´s fall price reduced an income of US$ 6100 millions to the sector.

Syndicalists reloaded
• With global crisis as scenario, the salary battle between enterprises and labour unions entered a completely different field to the one it has been going through during the last years. There is no salaries rise percentage defined. Some speculate the number will be near the 18 percent.
• Enterprisers think it is more important to keep labour sources in crisis context and trade unionists don’t want to talk about a rise limit,. The social agreement Government promoted did not have the influence enough yet.
• Until the last year, Government gave unions several concessions and tried, by CGT´s (General Confederation of Work) holder, Hugo Moyano, to establish a reference point for salary rises.

Translated by Clara Gómez Carrillo