Argentina
Following independence from Spain in 1816, Argentina experienced periods of internal political conflict between conservatives and liberals and between civilian and military factions. After World War II, a long period of Peronist dictatorship was followed by a military junta that took power in 1976. Democracy returned in 1983, and multiple free elections since then have underscored Argentina's progress in democratic consolidation.
While rich in resources, with a well-educated workforce, Argentina is one of South America's largest economies -- but it has also fallen prey to a "boom and bust" cycle.
After almost five years of recession, the Argentine economy ground to a halt in December 2001 as Buenos Aires defaulted on its approximately $140 billion debt. Civil unrest swept the nation as citizens were locked out of the country's banks and unemployment reached a record high of 18%. On December 20, 2001, President Fernando de la Rua resigned and an interim administration took the helm. Over the next ten days, two interim Presidents were sworn in and quickly resigned in the face of gathering economic and political problems. On December 31, 2001, Senator Eduardo Duhalde was appointed by the Argentine Congress to serve as President, making Duhalde the country's fourth President in a month.
The most pronounced of President Duhalde's crisis management measures was to abandon the country's 1991 Convertibility Law, which had pegged the Argentine Peso 1:1 to the U.S. dollar for 11 years. The peso was initially devalued by approximately 30%, but later depreciated more sharply after being allowed to float freely, losing about 70% of its value. Seeing the potential boon to exporters as a result of devaluation, the Duhalde administration also implemented a 20% tax on many exports, including oil and many oil derivatives. In addition, the Duhalde administration restricted bank withdrawals across the country thereby staving off a potentially massive drain of deposits as well as mitigating the country's growing inflation.
Nestor Kirchner won an uncontested presidential run-off vote in May 2003 after his rival, former President Carlos Menem, quit the race. Opinion polls had put Menem well behind Kirchner. As Kirchner took office, Argentina was still reeling from the economic collapse of late 2001, with more than half the population living in poverty. Managing Argentina's foreign debt and regaining the support of the International Monetary Fund (IMF) and international lenders were key challenges for the new President. Kirchner, a Peronist, governed the oil-rich Patagonian province of Santa Cruz for 12 years, and won praise for the efficient running of the province. During his presidential campaign he promised to create jobs with a major public works program and to strive for efficient government.
By 2003 a recovery was under way, and the International Monetary Fund (IMF) agreed to a vital new loan. The economy continued to suffer in 2004, but in 2005 the country restructured its massive debt, offering creditors new bonds for the old, defaulted ones. Poverty is still rife, and many Argentines still await the benefits of the economic upturn.
Argentina was one of the first Latin American countries to privatize state-owned companies and follow IMF-backed austerity measures. Most public utilities are in the hands of the private sector, including telecommunications, airlines, power generation and distribution, natural gas transportation and distribution, water systems, and railways. The country is committed to further spending cuts, in accordance with regulations connected to IMF funding.
While there are currently no known specific threats to foreigners traveling to Argentina, street protests occur frequently in Buenos Aires and other cities. These are often unruly, prompting the police force to step up its street presence. Protesters often block streets, highways, and major intersections causing traffic jams and delaying travel. Demonstrations are usually non-violent, but hooligans in some of the groups sometimes seek confrontation with the police and vandalize private property. Groups occasionally protest in front of the U.S. Embassy and U.S.-affiliated businesses. Visitors should take common-sense precautions and avoid gatherings or any other event where crowds have congregated to protest. Information about the location of possible demonstrations is usually available from the local media.
Individuals and organizations with ties to extremist groups, including some known to provide financial support to known foreign terrorist organizations, operate in Ciudad del Este, Paraguay in the tri-border area between Brazil, Paraguay and Argentina. No operational terrorist activities have been detected in Argentina, however. The governments of Argentina, Brazil, and Paraguay are engaged in a coordinated effort, supported by the U.S. government, to combat illegal activity in the tri-border area. Buenos Aires saw deadly attacks in 1992 and 1994. In November 2005, Lebanon's Hizballah guerrilla group denied accusations by an Argentine prosecutor it was behind the 1994 bombing at a Jewish community center in Buenos Aires that killed 85 people. Argentine federal prosecutor Alberto Nisman on November 9 identified the suspected mastermind behind the attacks as Ibrahim Hussein Berro and said there was strong evidence he was a Hizballah member. This was the first time that Argentine authorities had named the prime suspect behind the attacks.
In recent years, there have been several pipe bomb/incendiary incidents in metropolitan Buenos Aires, Mar del Plata, and Santa Fe. The bulk of the targets have been bank branches (ATMs), fast food restaurants, public utility offices, and political offices. These incidents usually occur in the middle of the night and appear intended to cause only property damage. There has been no indication that these incidents are connected to international terrorism. Such incidents increased in the autumn of 2005, apparently in connection with the attendance of U.S. President George W. Bush at the Summit of the Americas in Mar del Plata, an Argentinean resort town. On October 6, the day after the U.S. government confirmed that President Bush would attend the conference, there was a string of attacks in Buenos Aires, targeting U.S.-based interests including financial institutions, a McDonald’s restaurant and a Blockbuster Video store. Those sifting through the debris found pamphlets that read "No to Bush in Argentina!" The pamphlets were signed by unknown groups including the "Che Guevara Anti-Imperialist Commando." Another attack occurred on October 19, when a small bomb exploded outside a BankBoston branch in the city of La Plata.
Public transportation is generally reliable and safe. The preferred option for travel within Buenos Aires and other major cities is by radio taxi or "remise" (private car with driver). The best way to obtain taxis and remises is to call for one or go to an established stand, before hailing one on the street. Hotels, restaurants and other businesses can order remises or radio taxis, or provide phone numbers for such services upon request. Passengers on buses, trains, and the subway should be alert for pickpockets and should also be aware that these forms of transport are sometimes affected by strikes or work stoppages.
The Falklands/Malvinas Islands remain a major political issue. Following discrete bilateral discussions with the UK from 1989 onwards, the ending of formal hostilities has been succeeded by a series of agreements over fishing rights, oil exploration and other matters. The question of sovereignty is still firmly off the agenda. Relations with Argentina's immediate neighbors have improved steadily with the formation of a regional trading alliance. A recent row with Brazil over the latter's pitch for a permanent UN Security Council seat served as a reminder of the latent rivalry between the two major regional powers.
Government corruption and private sector business fraud are common complaints. Dishonest practices in the private sector-- including tax evasion-- are common in Argentina. Surveys by transparency international and other business and academic groups have contributed to more open debate of corruption and fraud. Procurement, regulatory systems, tax collection and health care administration are problem areas. The Argentine government maintains that official corruption has decreased dramatically as a result of the privatization of most state enterprises since 1989.
