THOUGH LATIN AMERICAN ECONOMIES LIKE ARGENTINA, VENEZUELA AND COLOMBIA HAVE SHOWN SOME RESILIENCE AGAINST THE OVERRIDING DOWNTURN IN THE RECENT PAST. BUT, WITH HUGE SOVEREIGN DEBTS AND THEIR GROWING INCAPABILITY TO SERVICE THEM AT A STANDARD RATE, THEY STILL STAND ON THE VERGE OF COLLAPSE, FEELS MANISH K. PANDEY…
They say easy money always fuels economies. Yes, it does, but can it forever? Latin American economies believe so quite passionately, and in their speedy race to the bottom based on a foxy premise, are on the verge of collapse. A closer look at the numbers and the state of utter economic shambles could well stun the reader! While with CPDs (cumulative probabilities of default) of 55.49% and 49.72%, Venezuela and Argentina respectively capture the second and third slot globally in the latest CMA rankings (of nations who have the highest probabilities of default), Colombia with CPD of 10.15% too has found itself a place in the list of countries who are steadily heading towards a default situation.
No doubt, a massive government spending in the first half of 2009 and a recently improved global economy have so far prevented these economies from a deeper downturn, but then how long? In fact, case by case examination of these three Latin American economies only suggests that they are heading towards a massive fall, smiles and conferences notwithstanding!
Though with a new debt swap in place, Argentine President Christina Fernandez de Kirchner plans to end the eight-year-long muddle that started from a massive default in 2001, but then, most of it seems inconsistent with the reality of macroeconomic indicators, and in some cases even ridiculous. To put it flatly, Argentina’s overall fiscal deficit has reached 2.2 billion pesos in September 2009 compared with a 2.2 billion peso surplus a year ago. In fact, September’s fiscal deficit is the largest so far this year, which guarantees the government will post its first annual deficit since 2002. So, in such a scenario, there is hardly any chance that the economy will escape the forthcoming financial tornado.
While Argentina’s fiscal spending grew 28.5% yoy in September and 27.6% through the first nine months of 2009, the total fiscal revenues increased by just 7.5% and 11.5% during the same period. Tax revenues alone (excluding social security and other non-tax receipts) have fallen by 1.8% in the first nine months – a drop of over 15% in real, inflation-adjusted terms. What’s more! The government has been unwilling to slow spending amid this year’s downturn. Reason: the 2011 presidential election is approaching and the Kirchner administration doesn’t want to compromise on its ‘flagging’ popularity.
They say easy money always fuels economies. Yes, it does, but can it forever? Latin American economies believe so quite passionately, and in their speedy race to the bottom based on a foxy premise, are on the verge of collapse. A closer look at the numbers and the state of utter economic shambles could well stun the reader! While with CPDs (cumulative probabilities of default) of 55.49% and 49.72%, Venezuela and Argentina respectively capture the second and third slot globally in the latest CMA rankings (of nations who have the highest probabilities of default), Colombia with CPD of 10.15% too has found itself a place in the list of countries who are steadily heading towards a default situation.
No doubt, a massive government spending in the first half of 2009 and a recently improved global economy have so far prevented these economies from a deeper downturn, but then how long? In fact, case by case examination of these three Latin American economies only suggests that they are heading towards a massive fall, smiles and conferences notwithstanding!
Though with a new debt swap in place, Argentine President Christina Fernandez de Kirchner plans to end the eight-year-long muddle that started from a massive default in 2001, but then, most of it seems inconsistent with the reality of macroeconomic indicators, and in some cases even ridiculous. To put it flatly, Argentina’s overall fiscal deficit has reached 2.2 billion pesos in September 2009 compared with a 2.2 billion peso surplus a year ago. In fact, September’s fiscal deficit is the largest so far this year, which guarantees the government will post its first annual deficit since 2002. So, in such a scenario, there is hardly any chance that the economy will escape the forthcoming financial tornado.
While Argentina’s fiscal spending grew 28.5% yoy in September and 27.6% through the first nine months of 2009, the total fiscal revenues increased by just 7.5% and 11.5% during the same period. Tax revenues alone (excluding social security and other non-tax receipts) have fallen by 1.8% in the first nine months – a drop of over 15% in real, inflation-adjusted terms. What’s more! The government has been unwilling to slow spending amid this year’s downturn. Reason: the 2011 presidential election is approaching and the Kirchner administration doesn’t want to compromise on its ‘flagging’ popularity.
troops in Afghanistan clearly shows the challenge that the US-led North Atlantic Treaty Organization (Nato) forces face in this war ravaged country. The maximum number of casualties have occurred in southern provinces around Helmand and Kandahar – at least 223 deaths since the war began in 2001.
even the remotest signs of fatigue. That is what sets him apart from other protesters who look drawn out and fatigued. He agrees with the ways of both Mahatma Gandhi as well as Subhash Chandra Bose. For him, there is no conflict of interest there. But in practice, he follows the non-violent ways of Gandhi. Satyagraha is his tool. For more than three years now, he has been fighting a battle for the separate statehood of Cooch Behar, comprising nine districts of Assam and West Bengal. The place where he has set his temporary abode is on the low-lying part of the footpath which gets water logged from time to time. Those nights, he has no option but to remain awake.