Argentina, a country well-acquainted with defaults, is on the precipice of yet another debt crisis. Argentina’s external debt has increased rapidly over the past two years, with much of that debt denominated in U.S. dollars at a time when the domestic currency is weak. The risk of a repeat of 2001, when the country defaulted on $93 billion of external debt, declined because the International Monetary Fund has already issued funds to the country. And even in the event of a crash, it is unlikely to trigger a global crisis. But the austerity measures that come with IMF assistance won’t be popular at home. The ability of this government and future governments to forge ahead could be the difference that enables Argentina to break its long cycle of economic instability.
Booms and Busts
For 15 years after its 2001 default, Argentina was frozen out of international capital markets. When it finally regained access to those markets, the government was faced with the task of normalizing
South America Explained in Maps
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