Argentina: A New Milonga

Nov 30, 2007

Argentina may be the credit international investors hate to love. But one of the most solid economies in the region is on the verge of a positive political transition.

The milonga is a series of tangos, with partners spinning, thrusting and parrying in the air. The dances are a sweaty blur, interspaced by short cortinas that allows the dancers to return to their seats or exchange partners. Argentina recently completed an exhaustive milonga, which commenced with economic distress and ended with one of the strongest expansions in Argentine history.


The election of President Cristina Kirchner on October 28 marked the end of the set and the start of the musical interlude. However, a new milonga starts on December 10, which promises to take Argentina in a fresh direction, but with some of the familiar themes of the previous set.


Argentina is booming. The economy surged 9.2% year-on-year in August, despite problems in the energy sector. Economic activity expanded 1.5% month-on-month, and the annual pace of GDP growth should be above 8.5% year-on-year in 2007 and at least 8%...

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“The crisis has been a setback for reserve diversification."

Jan Dehn, Ashmore Investment Management