Following the modest exploration of industrial identikit argentiono started here and here, is this brief illustration of what could be interpreted either as evidence of the failure of the substitution model, or as a successful model agricultural exports, depending on the vocation Industrialist of the reader. As shown, a decade of hedging and transfer to less competitive industries by encouraging domestic consumption has generated external balances industries increasingly negative (in the graph, NX are net exports: exports minus sector imports, "primary" refers to the primary sector, and "other" are other assets).
A pattern not unlike (but faster) that features our Big Brother (Brazil), who opted to keep inflation in check even at the expense of faster appreciation:
In principle, one could say that this result is not surprising: the impact of real appreciation on the competitiveness of the disadvantaged is one of the classical results of what is generally called Dutch disease, although this would to look more closely at the global production of these sectors.
But in the case of Argentina drew attention to the fact that the deterioration of external balance industrial precedes by several years the real appreciation, which would suggest it's more the effect of the failure (or, strictly speaking, the absence) of policies industrial, before the recent acceleration of the appreciation exchange. Or, coining expressions made light, to what might be called, paraphrasing Mervyn King, the theory Basile industrial policy (on which we will return in a future issue ...)
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