National Trade Data Bank ITEM ID : ST BNOTES ARGENTIN DATE : Oct 28, 1994 AGENCY : U.S. DEPARTMENT OF STATE PROGRAM : BACKGROUND NOTES TITLE : Background Notes - ARGENTINA Source key : ST Program key : ST BNOTES Update sched. : Occasionally Data type : TEXT End year : 1993 Date of record : 19941018 Keywords 3 : Keywords 3 : | ARGENTINA BACKGROUND NOTES: ARGENTINA PUBLISHED BY THE BUREAU OF PUBLIC AFFAIRS US DEPARTMENT OF STATE FEBRUARY 1993 Official Name: Republic of Argentina PROFILE Geography Area: 2,766,890 sq. km. (1.1 million sq. mi.); about the size of the US east of the Mississippi River. Cities: Capital--Buenos Aires (metropolitan area pop. 11.5 million). Other major cities--Cordoba, Rosario, La Plata, Mendoza. Terrain: Andes Mountains to long coastal regions; vast grassy plains (pampas). Climate: Varied, predominantly temperate. People Nationality: Noun and adjective--Argentine(s). Population (1992 est.): 33 million. Annual growth rate (est.): 1.4%. Density: 30 people per sq. mi. Ethnic groups: European 97%, mostly Spanish and Italian. Religions: Roman Catholic 92%, Protestant 2%, Jewish 2%, other 4%. Languages: Spanish (official), English, Italian, German, French. Education: Years compulsory--7. Adult literacy--95%. Health: Infant mortality rate--31/1,000. Life expectancy--68 yrs. male, 74 yrs. female. Work force: Industry and commerce--36%. Services--20%. Agriculture--19%. Transport and communications--6%. Other--19%. Government Type: Republic. Independence: July 9, 1816. Constitution: 1853. Branches: Executive--president, vice president, cabinet. Legislative--bicameral congress (48-member Senate, 257-member Chamber of Deputies). Judicial--Supreme Court. Subdivisions: 23 provinces, 1 district (federal capital). Political parties: Radical Civic Union, Justicialista (Peronist), numerous smaller national and provincial parties. Suffrage: Universal adult. Flag: Horizontal blue and white bands emblazoned with "Sun of May." Economy GDP (1992 est.): $150 billion. Annual growth rate (1992 est.): 6.5%. Per capita GDP (est.): $4,500. Inflation rate (1992 est.): 20%. Natural resources: Fertile plains (pampas). Minerals--lead, zinc, tin, copper, iron, manganese, oil, uranium. Agriculture (70% of GNP, about 70% of exports by value): Products--grains, oilseeds and byproducts, livestock products. Industry (21% of GNP): Types--food processing, motor vehicles, consumer durables, textiles, metallurgy, chemicals. Trade (1991 est.): Exports--$12 billion (US-12%): grains, meats, oilseeds. Imports--$8.1 billion (US--23%): machinery, fuel and lubricating oils, iron and steel products, wood and lumber, automotive equipment and parts, chemicals. Major trading partners--European Community, Japan, US, Brazil. Exchange rate: US$1=.99 Pesos (April 1992). Economic aid received: IBRD--$4.4 billion (cumulative commitment as of September 30, 1990). IFC--$362 million (cumulative commitment as of December 31, 1991). IDB--$4.5 billion (cumulative commitment as of June 30, 1991). PEOPLE The Argentine nation has been built by the fusion of diverse national and ethnic groups. Waves of European immigrants arrived in the late 19th and early 20th centuries. Today, descendants of Italian and Spanish immigrants predominate, but many also have British and West and East European ancestors. Syrian, Lebanese, and other Middle Eastern immigrants number about 500,000 and are concentrated in urban areas. In recent years, there has been a substantial influx of immigrants from neighboring Latin American countries. The native Indian population, now estimated at 50,000, is found in the peripheral provinces of the north, northwest, and south. The Argentine population has one of the lowest growth rates in Latin America (1.4%). Eighty percent of the population reside in urban areas of more than 2,000, with more than one-third of the population living in the metropolitan Buenos Aires area. The sprawling capital, with more than 11 million inhabitants, serves as the focus for national life. Argentines enjoy comparatively high standards of living; half the population considers itself middle class. More than 90% of Argentines are Roman Catholic. Religious freedom is practiced, although all non-Catholic denominations are required to register with the government. The Protestant community is small but active. Argentina's Jewish community of about 350,000 is concentrated in Buenos Aires. The Argentine educational system is compulsory for grades 1-7, starting at age 6. The adult literacy rate is 95%--one of the highest in Latin America. Literary and artistic tastes have been influenced mainly by Western Europe and, more recently, by the United States. A large number of Spanish daily newspapers are published in the greater Buenos Aires area; a dozen community newspapers are published in English, French, German, Greek, Hungarian, Italian, Japanese, Polish, Ukrainian, and Yiddish. All the community newspapers are periodicals except the daily English-language Buenos Aires Herald. HISTORY AND POLITICAL CONDITIONS Europeans arrived in the region with the 1502 voyage of Amerigo Vespucci. Spanish navigator Juan de Solis visited what is now Argentina in 1516. A permanent Spanish colony was established on the site of Buenos Aires in 1580. Argentina was further integrated into the Spanish empire following the establishment of the Vice-Royalty of Rio de la Plata in 1776, and Buenos Aires became a flourishing port. The formal declaration of independence from Spain was made on July 9, 1816. Gen. Jose de San Martin--who campaigned in Argentina, Chile, and Peru--is the hero of national independence. Following the defeat of the Spaniards, a lengthy conflict was waged between centralist and federalist groups to determine the future structure of the nation. National unity was established and the constitution promulgated in 1853. In the late 19th century, two forces created the modern Argentine nation: the introduction of modern agricultural techniques and the integration of Argentina into the world economy. This economic revolution was aided by foreign investment--primarily British--and by the influx of European workers. Conservative forces dominated Argentine politics until 1916, when their traditional rivals, the Radicals, won control of the government through a democratic election. The Radicals, with their emphasis upon clean elections and democratic procedures, opened their doors to the nation's expanding middle class as well as to the elites previously excluded for various reasons. Radical rule came to an end in 1930 when the Argentine armed forces threw out aged Radical president Hipolito Yrigoyen and ushered in another decade of Conservative rule. Using fraud and force when necessary, the governments of the 1930s attempted to contain forces for economic and political change that helped produce the government of Juan Domingo Peron. In 1943, a military coup--led by, among others, Col. Juan Domingo Peron (1897-1974)--ousted the constitutional government. In 1946, Peron was elected president. He pursued policies aimed at giving a greater economic and political voice to the working class. The number of unionized workers increased significantly, which helped consolidate the powerful General Confederation of Labor (CGT). In 1947, Peron announced the first 5-year plan based on nationalization and industrialization. He was aided by his energetic wife, Eva Duarte Peron (1919-52). She enhanced his appeal to labor and women's groups and helped women obtain the right to vote in 1947. Peron was reelected in 1952 but ousted by the military in 1955. He went into exile, eventually settling in Spain. In the 1950s and 1960s, the government passed between military and civilian administrations as each sought to deal with declining economic growth and continuing social and labor demands. Finally, in the late 1960s and early 1970s, when military governments failed to revive the economy and suppress escalating terrorism, the way was open for Peron's return. On March 11, 1973, general elections were held for the first time in 10 years. Peron was prevented from running, but a stand-in, Dr. Hector J. Campora, was elected. The Peronists also commanded a strong majority in both houses of the National Congress. Campora resigned in July 1973, paving the way for Raul Lastiri, a Peronist party loyalist, to assume the presidency and call for new elections. In these, Peron won a decisive victory and returned as president in October 1973 with his third wife, Isabel de Peron, as vice president. Even after Peron's dramatic victory, extremists on the left and right continued to threaten public order. The government resorted to a number of emergency decrees, including the implementation of special executive authority to deal with violence. This allowed the state to imprison persons indefinitely without charge. On July 1, 1974, Peron died and was succeeded by his wife. Her administration was undermined by ongoing economic deterioration, Peronist intraparty struggles, and persistent terrorism from both left and right. As a result, she was removed from office by a military coup on March 24, 1976. Until December 10, 1983, the armed forces governed through a junta composed of the three service commanders. The military quashed terrorists and their sympathizers, silenced armed opposition, and restored basic order. The costs were high in terms of lives lost and basic human rights violated. Serious economic problems, defeat by the British in June 1982 after an unsuccessful Argentine attempt to establish sovereignty over the Falkland/Malvinas Islands, human rights abuses, and charges of growing corruption discredited and discouraged the military regime. This resulted in a period of gradual transition, leading the country toward democratic rule. Previous bans on political parties were lifted and other basic political liberties restored. On October 30, 1983, Argentines went to the polls to choose a president, vice president, and 14,000 other national, provincial, and local officials in what were declared by international observers to be fair, open, and honest elections. Raul Alfonsin, candidate of the Radical Civic Union (UCR), was elected president, winning 52% of the popular vote. He began a 6-year term of office on December 10, 1983. In 1985 and 1987, large turnouts at the mid-term elections demonstrated continued public support for a strong and vigorous democratic system. The Radical Civic Union-led government took steps to resolve some of the nation's most pressing problems, including accounting for those who disappeared during military rule, establishing civilian control of the armed forces, and consolidating democratic institutions. Its effectiveness was hindered by constant friction with the military and an inability to resolve endemic fiscal mismanagement and to inspire public confidence. In May 1989, Carlos Saul Menem, the Peronist candidate, was elected president with 47% of the popular vote and a clear majority in the nation's electoral college. The Peronists and their allies also won control of both houses of the Congress. President Menem was to have succeeded Alfonsin in December of 1989, but a rapidly deteriorating economic situation and resulting loss of confidence in the national government led Alfonsin to resign in July. Menem succeeded him. Although the transition came 5 months earlier than planned, the transfer of power was the first between democratically elected presidents in more than 60 years. Menem surprised most observers, including members of his own party, by adopting economic policies diverging from Argentina's (and Peronism's) traditional statist approach. He initiated emergency economic and state reform legislation that cut government spending, increased revenues, and reduced state involvement in the economy. In April 1991, the convertibility law was enacted which fixed the exchange rate, prohibited financing of the government's fiscal deficit by the central bank, and declared all indexation schemes illegal. Menem also moved quickly to privatize government-owned industries, such as Aerolineas Argentinas and the telephone company. These policies have generated some resistance among sectors historically allied to Peronism as well as in sectors of the Radical Party. However, opposition remains fragmented. GOVERNMENT The 1853 Argentine constitution, similar to that of the United States, mandates a separation of powers into executive, legislative, and judicial branches at the national and provincial level. Each of the 23 provinces also has its own constitution. The president and vice president are elected to a 6-year single term and cannot immediately run for reelection. Senators are elected by provincial legislatures (with the exception of the two senators representing the federal capital of Buenos Aires which are elected by an electoral college) for 9-year terms, with one-third standing for reelection every 3 years. Deputies are elected for 4 years in alternate terms, with half up for reelection every 2 years. Cabinet ministers are appointed by the president. The constitution gives the president considerable power, including that of a line-item veto. The Argentine judiciary is separate and independent. The apex of the court system is the Supreme Court, whose nine judges are appointed by the president with the consent of the Senate. The Supreme Court has the power, first asserted in 1854, to declare legislative acts unconstitutional. Principal Government Officials President--Carlos Saul Menem Foreign Minister and Worship--Guido Di Tella Minister of Economy, Public Works, and Services-- Domingo Cavallo Ambassador to the United States--Carlos Ortiz de Rozas Ambassador to the OAS--Hernan Patino Meyer Ambassador to the UN--Emilio Cardenas Argentina maintains an embassy in the United States at 1600 New Hampshire Ave., NW, Washington, DC 20009 (tel. 202-939-6400; Fax: 202-332-3171). Argentina has consulates general in Houston, Miami, New York, New Orleans, San Francisco, and San Juan and consulates in Baltimore, Chicago, and Los Angeles. ECONOMY Argentina has impressive human and natural resources, but political conflict and uneven economic performance over the last 50 years have impeded full realization of its potential. Nonetheless, it remains one of the richest countries in Latin America. Faced with healing a scarred society, the Alfonsin Government was slow to tackle deep structural problems. In June 1985, Alfonsin introduced the "Austral Plan," which succeeded temporarily in reducing inflation by introducing wage and price controls and imposing a measure of fiscal prudence. The plan foundered in 1987, when a significant increase in the fiscal deficit accompanied by very large price and wage increases pushed annual inflation to 175%; in 1988, annual inflation reached 386%. Another economic initiative, the "Spring Plan," was announced in 1988. It collapsed in February 1989, marking the start of a dramatic deterioration of the economy, which was worsened by political and economic uncertainties surrounding the May 1989 elections. President Menem took office in July 1989 and amid hyperinflation moved quickly to re-establish economic stability. Inflation reached 198% in July, a Western Hemisphere record for 1 month. Menem also sought to bring the fiscal deficit under control and to reduce the intrusive role the state had played for decades in all aspects of Argentina's economic life. His first two economic teams had some measure of success. Menem's third economy minister, Domingo Cavallo, entered office in February 1991. Cavallo's determined pursuit of economic reform and fiscal responsibilities has helped provide the stability necessary to control hyperinflation and reverse decades of economic decline. Argentina's successes have generated international support. The International Monetary Fund approved a stand-by program in June 1991 and an extended funding facility in March 1992. Argentina also received substantial support from the International Bank for Reconstruction and Development and the International Development Bank. Its debt with commercial banks, including $7 billion in arrears, will be restructured under the US "Brady Plan." Argentina's richest natural resource is the rich temperate plain known as the pampas, which fans out almost 800 km. (500 mi.) west of Buenos Aires. It produces large quantities of wheat, corn, sorghum, soybeans, and sunflower seeds and offers year-round pasturage for Argentina's cattle industry. Argentina is one of the world's largest exporters of foodstuffs. Argentina exports to a variety of worldwide buyers. In the early 1980s, the then-Soviet Union became the major purchaser of grains, while more recently, Iran, Brazil, and China have served as major markets. Argentina also exports agricultural goods to the United States (primarily canned, precooked, and frozen beef; sugar; and fruits and fruit products). Argentina obtains about 23% of its imports from the United States. Total imports in 1991 were $8.1 billion, of which $1.9 billion was from the United States. Capital equipment, computers and peripherals, telecommunications, chemicals, and electronic components were the principal items sold to Argentina. In 1991, Argentina exported $12 billion worth of goods and services; $1.4 billion (12%) went to the United States. Argentina was a net energy exporter in 1991. It has significant reserves of petroleum and natural gas. The Menem Government has opened the petroleum sector to private development and, as a result, petroleum production has expanded greatly. Significant deregulation of the petroleum sector, including price controls, took effect January 1, 1991. Argentina also has a large electric production capacity, mostly from hydroelectric sources. It has express a desire to reduce the size and cost of the massive hydroelectric project (2,400 megawatts) being constructed with Paraguay and scheduled for completion in the late 1990s. Argentina has the most advanced nuclear program in Latin America; nuclear power provides some 13% of the country's electrical needs. Two nuclear power plants are completed, and a third is under construction. Argentina also exports nuclear technology and assistance. DEFENSE The armed forces of Argentina (army, navy, air force) are controlled by the president and a civilian minister of defense. The joint staff, established in 1984, is directly under the Ministry of Defense and is staffed by officers of all services. The joint staff is an advisory and planning body with no operational or command responsibilities. The senior military officer of each of the armed services is the chief of staff. The paramilitary forces under the control of the Ministry of Defense are the Gendarmeria of the Naval Prefectura (Coast Guard). The Argentine armed forces also maintain defense cooperation and military supply relationships with a number of other countries, principally Israel, Germany, France, Spain, and Italy. The lack of budgetary resources is the most serious problem facing the Argentine forces. Current economic conditions and the government's commitment to reduce the public sector spending have slowed modernization and restructuring efforts. FOREIGN RELATIONS Argentina increasingly pursues a pragmatic foreign policy and maintains diplomatic relations with almost all countries. Support for democracy and the promotion of increased trade and investment are major priorities. Its relations traditionally have been closest with Western Europe, the United States, and its Latin American neighbors. President Menem is committed to improving those relations, while encouraging Latin American regional integration. Having settled its Beagle Channel dispute with Chile in 1984-85, and having sent other border disagreements with the Chileans to arbitration, Argentina presently has only one active territorial dispute; this is with the United Kingdom over a group of islands some 480 miles northeast of Cape Horn. The Argentines refer to them as the "Malvinas Islands"; the British call them the "Falkland Islands." Historically, European powers, notably Britain and Spain, made competing claims to sovereignty over these islands. In the early 1800s, Spanish and then Argentine authorities administered them. However, in January 1833, Britain reasserted sovereignty, and the islands first became a crown colony and later a self-governing dependency. In an effort to re-establish its sovereignty claim, Argentine military forces occupied the islands on April 2, 1982. After a brief, costly war, the Argentine forces were defeated. Direct talks between Argentina and the UK began in September 1989 in an attempt to re-establish diplomatic relations, which were severed following the conflict. The talks took place under a formula that separated the sovereignty questions from other discussions on bilateral relations. The two countries re-established formal relations in February 1990. Argentina continues to press its sovereignty claim in a variety of forums. The United States has taken no position on the merits of the two countries' sovereignty claims. US-ARGENTINE RELATIONS The United States and Argentina have maintained diplomatic relations since 1823. Both countries have sought a constructive relationship based on reciprocal respect and understanding, but bilateral relations often have been turbulent. In the 1970s, US-Argentine relations entered a particularly difficult period. Concerned about serious human rights violations in the Argentine military government's campaign against terrorism, the United States restricted both military assistance and the sales of military and other controlled-export items to Argentina. Congress prohibited military sales and assistance. Argentina consistently maintained that such actions were US attempts to influence domestic politics. The Falklands/Malvinas war placed additional strains on bilateral relations. The US position on the non-use of force for the resolution of disputes led the United States to impose new sanctions on Argentina and to provide limited assistance to the United Kingdom in its campaign to regain the islands. US-Argentine relations improved after the Falklands/Malvinas war. Sanctions imposed during the fighting were lifted, and the United States supported Argentine-sponsored UN resolutions calling for renewed Falkland/Malvinas negotiations. The Argentine human rights situation and political climate improved dramatically following the military's mid-1982 decision to return the country to democracy. During 1983, all remaining political prisoners being held without trial under state-of-siege powers were released. Also in 1983, the 9-year-old state of siege was lifted, and restrictions on trade union activities and press censorship virtually ceased. Since the return of democratic government, the US and Argentine armed forces have developed a growing, mutually beneficial defense relationship through the extensive range of contacts, including professional exchanges, visits, training, and joint exercises. There are modest international military education, training, and foreign military sales programs. The Menem Government has adopted a pro-Western stance and has emphasized cooperation with the United States in resolving differences. The countries consult regularly on hemispheric issues. Argentina's relative prosperity prompted the United States to phase out its bilateral economic assistance program in 1971, although some limited assistance continues. Many US industrial firms and banks maintain subsidiaries in Argentina. Licensing agreements with local companies are common. US private investment totals more than $2.6 billion, primarily in manufacturing chemicals, agricultural equipment manufacturing, transportation equipment, and banking. Several thousand US citizens reside in Argentina. Principal US Officials Ambassador--Terence A. Todman Deputy Chief of Mission--James D. Walsh Counselor for Agricultural Affairs--Max Bowser Counselor for Public Affairs--Ernesto Uribe Counselor for Scientific and Technological Affairs-- Paul Maxwell Counselor for Political Affairs--Timothy J. Dunn Counselor for Consular Affairs--Barbara Hemingway Counselor for Economic Affairs--Peter Whitney Labor Attache--William L. Lofstrom Counselor for Administrative Affairs--Bernard Segura-Giron Counselor for Commercial Affairs--Rafael Fermoselle Defense Attache and Air Attache--Col. Wayne Fisher, USAF Drug Enforcement Administration--James D. Miller Military Group--Col. John Woolshlager, Army The US embassy in Argentina is located at 4300 Colombia, Buenos Aires 1425. The APO address for the embassy is APO AA 34034-0001 (tel. 774-7611; 774-8811; 774-9911; Fax: 54-1-775-4205). TRAVEL NOTES: Visas: Visas are not required for US citizens entering Argentina for tourism for periods up to 90 days. Visas are required for visits to Argentina for all other purposes. Climate and clothing: Climate ranges from the hot, subtropical lowlands of the north to cold and rainy Tierra del Fuego in the south. The seasons are reversed: the weather in January in Buenos Aires is like July in Washington, DC; weather in July is similar to that of San Francisco in January. Health: Competent doctors and dentists are available in Buenos Aires. Travelers may wish to consult up-to-date health information upon arrival. Bottled water is recommended. Avoid raw fish and seafood; other uncooked foods should also be avoided. Telecommunications: International services are adequate; however, long delays in placing international calls may occur due to the overburdened system. Certain sections of Buenos Aires have direct international dialing. Most provincial cities and Uruguay also can be dialed directly from home and business phones. Transportation: Buenos Aires' Ezeiza Airport is serviced by many international carriers, with flights originating in the US, Europe, and other Latin American cities. Buenos Aires has an extensive subway and bus system. Taxis are plentiful. Outside Buenos Aires, travel is by train, air, bus, or auto. Time zones: Argentina is 2 hours later than US Eastern Standard Time (EST). Daylight savings time is observed from October to April. Published by the United States Department of State -- Bureau of Public Affairs -- Office of Public Communication -- Washington, DC -- February 1993 -- Editor: Anita Stockman Department of State Publication 7836 Background Notes Series -- This material is in the public domain and may be reprinted without permission; citation of this source is appreciated. For sale by the Superintendent of Documents, US Government Printing Office, Washington, DC 20402. Contents of this publication are not copyrighted unless indicated. If not copyrighted, the material may be reproduced without consent; citation of the publication as the source is appreciated. Permission to reproduce any copyrighted material (including graphics) must be obtained from the original source.