Argentina's economy has traditionally been based on agriculture, but the industrial and service sectors have also grown in importance in recent years. Livestock (cattle and sheep) and grains have long been the bulwark of its wealth; its cattle herds are among the world's finest. As an exporter of wheat, corn, flax, oats, beef, mutton, hides, and wool, Argentina rivals the United States, Canada, and Australia. Its other agricultural products include oilseeds, lemons, soybeans, grapes, and tobacco. Argentina is the world's largest source of tannin and linseed oil. The Pampa is the nation's chief agricultural area; however, since the 1930s there has been a great rise in production in other areas, especially in the oases of the Monte and the irrigated valleys of N Patagonia.
Although Argentina has a variety of minerals, they are of local importance and are not completely adequate to support the country's industries. Domestic oil and gas production has made the nation self-sufficient in energy; pipelines connect the oil and gas fields with Buenos Aires and other major refining centers. Argentina also exploits its ample hydroelectric resources. The large coal field of S Patagonia has low-grade coal.
Food processing (in particular meatpacking, flour milling, and canning) is the chief manufacturing industry; motor vehicles, textiles, chemicals, petrochemicals, and steel are also major products. Argentina's principal imports are machinery, motor vehicles, chemicals, metals, plastics, and other manufactured goods. The chief trading partners are Brazil, the United States, China, and Chile. Argentina is a member of Mercosur.
In recent decades Argentina has experienced both inflation and recession. Privatization and other economic reforms begun by President Menem in the early 1990s produced unprecedented economic growth, but significant economic problems remained, including high unemployment and a massive national debt (due to freehanded government spending and widespread tax evasion). The economy was hurt by Brazil's recession and currency devaluation in the late 1990s, but the pegging of the peso to the dollar combined with Argentina's own economic problems resulted in economic collapse in 2001. The economy did not begin to grow strongly again until 2003. In the early 21st cent., the government reversed some of the privatization that had occurred in the 1990s.
More on Argentina Economy from Fact Monster:
See more Encyclopedia articles on: South American Political Geography