International Specialization and Trade Regimes in Argentina: 1960–99

During the 1990s, particularly in the early years, Argentinian exports soared. Between 1990 and 1996, exports increased by 11 per cent a year on average, rising from US$12 billion to US$25 billion. In 1998-99 an adverse external shock led to a temporary decline in exports by value. This rise in exports during a period of monetary stabilization and deep economic restructuring (trade liberalization cum massive privatization) generated controversy. What was the source of this development? Was the pattern of export growth sustainable? Which dynamic sectors explained this performance? Was there any process of primary export deepening that might induce low growth, and constrain the economy? How important was Mercosur and the ‘Brazil effect’? This chapter attempts to answer these questions by studying changes in Argentina’s pattern of trade, tracing the historic perspective in order to isolate fundamental long-term trends from the frequent, abrupt short-run changes. We have, therefore, studied developments in the performance over 40 years, focusing on changes in Argentina’s comparative advantage. Section 2 provides an overview of trade performance; section 3 discusses alternative trade regimes, while section 4 suggests some conclusions.1