MercoPress. South Atlantic News Agency

Markets for Argentine produce

Economy Nobel Prize winner Joseph Stiglitz in a long column published in the Financial Times said that Argentina needs the opening of foreign markets if the country is to recover its real economy.

Mr. Stiglitz insists that the international community must open markets effectively not rhetorically, and questions if foreign investors would have returned to Argentina if the country had complied with all of IMF demands. "It's hardly likely".

The former head of World Bank economists underlines that Argentina needs markets for its production and credit for its companies. Something Mexico was able to accomplish following the 1994/95 crisis thanks to its trade alliance with the United States, rather than with the help of the IMF, according to a World Bank paper on the issue.

Mr. Stiglitz also points out that the end of the Asian financial crisis was instrumented with the "Miyazawa" initiative that consisted in a Japanese credit of 30 billion US dollars so its neighbours could begin exporting once again.

"None of this have we offered Argentina", writes Mr. Stiglitz. Markets for additional sales of grains, wine, beef, "will be far more effective than billions of dollars of IMF financial aid".

Further on Mr. Stiglitz says that the first signs of the Argentine economy recovery are evident, and even when abandoning the convertibility system, with the peso pegged to the US dollar, was a disaster forcibly contracting production and employment, "the country managed to avoid hyperinflation".

Argentina's recovery is no mystery for economists, with the devaluation of the local currency exports become cheaper and revenue in pesos rockets spectacularly. "Tourism, export industries and import substitution are booming".

However Mr. Stiglitz warns rich developed countries that "free trade rhetoric must be serious and become effective" if recurrent crisis are to be avoided.