By Shane Romig for Wsj.com with contributions by Alberto MesserArgentine President Cristina Fernandez unveiled an ambitious growth plan Thursday that she hopes will fuel a 5% annual expansion in gross domestic product over the next decade.
Key to fueling the growth will be a continuation of the policies focusing on domestic demand, import substitution and heavy government intervention in the country's economy, Fernandez said during a press conference. This is the last year of her four-year term, and she is widely expected to seek a second term in October elections.
Critics "wanted us to cool down the economy, but if we'd done that, we would have frozen" during the slowdown caused by the international financial crisis in 2009, she said.
Argentina's economy expanded by a blistering 9.1% in 2010, according to the president, with expectations for growth at about half that rate this year.
But amid that strong growth, imports have been surging.
Last year, exports rose 23%, to $68.5 billion, led by automobiles, grains and agricultural products like soyoil. At the same time, the booming domestic economy fueled a 46% increase in imports, to $56.44 billion, with intermediate goods used by local industry, capital goods, and automobiles posting the biggest gains.
Faced with the steep rise in imports, Argentina has stepped up trade barriers, expanding the list of goods that require a nonautomatic license to be imported, as well as slapping antidumping duties on a range of Chinese-made air conditioners.
That has spooked neighbors Brazil and Uruguay, although the government was quick to say that the measures wouldn't target them. The industry ministry has repeatedly said that the new measures aren't aimed at its neighbors in the Mercosur trade bloc, which includes Argentina, Brazil, Uruguay and Paraguay. The nonautomatic licenses "are aimed at monitoring imports from..Read full article
