Argentina’s decision to nationalise YPF – a subsidiary of Spanish energy company Repsol – has been met by international disapproval; though the Argentine government insists that the move had been necessary in order to meet its energy needs. Yet this may not turn out to be the case, particularly with investment in exploration greatly reduced.
Despite fierce criticism from Spain and EU officials, Argentina has announced plans to seize majority control of Spanish oil and gas company YPF. Last November, YPF announced a major 1 billion barrel shale oil find in Argentina.
Cheered by her ministers and regional governors, Argentina President Cristina Fernandez said a bill has already been sent to Congress that would allow for the nationalisation of 51 percent of YPF, which is now majority-owned by a Spanish energy company, Repsol YPF.
President Barack Obama has suspended duty-free Argentine imports into America amid a trade dispute involving U.S. investors, saying that Argentina has failed to pay more than $300 million in compensation awards to US companies.
Until Argentina pays the court-ordered damages, it would no longer qualify for duty-free trade with the United States.
Argentina and China signed a deal for Beijing to invest $10 billion in the South American nation’s railways during a visit by the Argentine president to Beijing,
but there was no sign of progress in a dispute over soy imports.
The agreements announced during the visit by President Cristina Fernandez earlier this month come
as Beijing expands its role in Latin America through investments in oil and other industries and closer financial ties with the region’s governments.
Argentina is an upper middle-income economies coming under the Latin America and the Caribbean region, as to the classification made by the World Bank on the basis of income and region for the year 2006.
The major industries of the country are meatpacking, chemicals, textiles, machinery and flour milling. Important crops of the country are sugar, tobacco, rice, grains and maize. Both the agricultural activities as well as animal husbandry are the top agricultural activities in the state.
Argentina has a rich agricultural sector, which is one of the primary exports. In addition, this country’s industrial sector is extremely diversified. Up until 2002, the country experienced a horrific economic and political crisis, lasting five years but after that time, the Gross Domestic Product or GDP grew by 9%. Unfortunately, the world financial crisis hit Argentina hard in 2008 and 2009, which led to the government pulling back on the amount of exports.
