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A very famous country of South America has left Pakistan behind in terms of poverty. Till now we have been hearing stories of poverty and inflation in Pakistan, but the condition of this country which was once the largest economy of South America is getting worse than Pakistan. While poverty in Pakistan is around 40 percent, poverty in this country has crossed the 50 percent mark.
Actually we are talking about Argentina. It is situated on the southern tip of South America, its sea border meets the Atlantic Ocean in the east. Even if you have never heard the name of Argentina, you must have heard the name of this country’s great football player Lionel Messi. The population of Argentina is around 4 crore 73 lakhs, it is a country which is full of natural resources and has an educated workforce. Still, this country is currently struggling with terrible economic crisis.
52.9 percent poverty in Argentina
If we talk about the current situation of Argentina, more than half of the country’s population is poor. According to the report released by INDEC Statistics Agency on Thursday, poverty in the country has reached 52.9 percent in the first half of this year. Whereas last year this figure was 41.7 percent. From these figures, it can be estimated how fast poverty has increased in Argentina in the last one year, according to the report, one out of every 5 people in Argentina is poor.
Why did the situation become so bad in Argentina?
Although the reason for Argentina’s plight is recorded in the pages of history, but the politics of the last 2 to 3 decades is responsible for bringing this country to such a bad condition. This country, which gained independence in 1810, faced a huge economic recession after about a century. After the economic crisis in 1930, the army overthrew the elected government, the army’s policies pushed Argentina back economically.
After a long period of political turmoil, democracy returned to Argentina in the year 1983. The new government tried to get the country out of the bad phase of economic crisis, to some extent it was successful in this, but in the year 2010, a decision of the Argentine government caused great damage to the country.
Big loss due to a decision in 2010
Actually, the then Cristina Fernandez government started using the reserve fund of the country’s Central Bank to repay the debt. For this, the government had shown the way out to the Chief of the Central Bank, because he refused to transfer the funds to the government, he had to pay the price for this by resigning from his post. According to experts, from here the economy of Argentina went into such a pit that it can no longer be improved.
Due to the deteriorating economy, skyrocketing inflation and poverty, the people of Argentina became disillusioned with traditional politics. In the 2023 elections, people gave an opportunity to right-wing-capitalist Javier Millai with less political experience.
The right-wing president made big promises
Argentina’s current President Millai took over the reins of power in December 2023, he managed to gain the trust of the public by making big claims to improve the economy and get rid of inflation, but the latest data clearly shows that the economy is going through a worse phase under his government.
In fact, after taking office in December, the Millai government started implementing very tough decisions aimed at eliminating the budget deficit and controlling inflation. His government cut subsidies for transport, fuel and energy, while thousands of government employees lost their jobs.
Annual inflation rate is the highest in the world
At the same time, when Millai took office in December, the peso was devalued by more than 50 percent, causing the monthly inflation rate to rise to 25.5%. This move of the government, in addition to severe budget cuts, also affected the purchasing power of the people. These efforts of the Millai government made people poorer. Although Argentina’s monthly inflation rate fell to 4.0 percent in July, the lowest in 2.5 years, its annual figure of 263.4 percent remains one of the highest in the world.
