THEArgentina is again on the verge of bankruptcy. There defeat of liberal president Mauricio Macri in the primaries wider than expected and above all the victory of the Peronist Alberto Fernandez, supported by former president Cristina Kirchner, yesterday revived a nightmarish day in Argentina that brought back all the ghosts of the financial crisis.
The Exchange of Buenos Aires lost 37% (but -48% in dollars), especially affecting public groups, banks and companies most exposed to the domestic market which have come to lose up to 50%. The local currency also collapsed – weight – which he left on the field 19% against the dollar.
Faced with a nightmare day the Central Bank he believed he could run for cover by raising the reference rate, which has arrived from 63% the previous day to the record figure of 74%, even one point above the 2018 record.
Despite the help of International Monetary Fund, which last October granted Argentina loans for 56 billion dollars, the South American country's economy (where many Italian groups operate: from Tenaris to FCA and from Pirelli to Enel) is collapsing with inflation above 50%, a stagnant GDP and a poverty index of 35%.
Now the president Macri invites the population to be patient but so far her liberal recipe hasn't had any luck and in these conditions Peronist demagoguery has a good time making people forget Kirchner's disasters and selling dreams that will never come true.
After all, Argentines are used to living with crises and know that after a certain number of years they always reappear in the limelight because the recovery of the country, which would require major reforms, has never happened.
