Contributions to the Secretary-General's GIVAS report
Buenos Aires, May, 2010 National context After six years of sustained economic growth, in 2009 the Argentine economy experienced a deceleration in the activity, representing a year-to-year increase of GDP of 0.7%. Throughout that year, private capitals were persistently transferred abroad, though this phenomenon was combined with a significant excess in the trade balance, keeping the financial system in equilibrium. In this context, in the last quarter of 2009, the Argentine economy began showing signs of recovery in the economic activity which resulted in the beginning of a period of recuperation. Besides, during this period there has been a relatively stable financial and exchange rate evolution.
On the other hand, as a consequence of the implementation of active economic policies, the public expenditure increased significantly, mainly due to the rise of investments and expenditure in social services. Even though the assessment of consumer prices inflation from Argentina’s National Institute of Statistics and Censuses (INDEC) indicates 7.7% for 2009, analysts agree on a sub-valuation of such increase in prices on part of that organization and recognize inflation as the main macroeconomic problem in the coming months.
Until the first part of 2009 the Argentine economic crisis took the shape of a recession that was nowhere similar to the 2001 – 2002 collapse. In the short term, the country has managed to relatively smoothen the impact of the global financial crisis by increasing market regulations, launching policies to stimulate demand and prioritizing social protection networks.
In the third quarter of 2009 (last available data) the rate of unemployment was of 9.1%, representing 1.3 percentage points higher than the registered rate of 2008. The decrease in the level of activity accounted for the loss of 230,000 registered private employments and around 120,000 unregistered salary employments. In some cases, these decreases were compensated with employment increases in the public sector, cushioning the effect of the crisis over the employment. According to official figures published by the INDEC, the rates of poverty and indigence were reduced significantly in around 14% and 4%, respectively, between 2009 and 2008. However, the sub-valuation of price increases might overestimate the increase in these rates.
The book presents the outcome of research activities performed during 2009 oriented to describe the international evolution and the local impacts of the crises; analyze possible scenarios and present a wide restrictions and opportunities spectrum regarding the macroeconomic and international productive insertion strategy of Argentina. The study contains vast information and raw data (both qualitative and quantitative) concerning the international crisis evolution and its transmission mechanism that impacted the country.
Chapter 1, outlines the crisis macroeconomic characteristics and impacts, Argentina’s strengthens and vulnerability and strategic alternatives that the country can use to mitigate its effects. Chapter 2, presents a study focused on international trade and commerce that affect the country and analyzes the strategic specialization pattern within MERCOSUR. Chapter 3, is dedicated to the direct foreign investment both in terms of perspectives and policy alternatives (automotive, steel and IT industries). Chapter 4, deepens on the agro industrial main value chains and its possibilities of scaling up the international context. Finally, chapter 5, shows grow and general computable equilibrium patterns that allows the simulation of long term scenarios for the country.
The global economic crisis and its impact on HIV and AIDS programmes and services
Type: Case study and executive summary
Participating UN Agencies: ONUSIDA
Authors: Javier Curcio
The HIV/AIDS-related programs are financed basically with funds of the National Treasury. Among the current financial assistance programs is the PHEF project (Public Health Essential Functions and Priority Programs) financed through a World Bank loan. On the other hand, the country does not rely on foreign donations of importance, except from resources from the Global Fund, which terminated in 2008.
The impact of the crisis on the HIV/AIDS programs is reduced. Anyways, there are budget cuts and sector prioritizations. In this context we experienced a reduction in the available resourced for the AIDS National Program, impacting more severely the prevention programs for drug users, men who have sex with men, sex workers, and counseling and voluntary testings. The rest of the initiatives of the program kept their activity expected levels. In connection with the future crisis impact, if the intensity remains, there will be no expectations of a drastic reduction in expenditures in HIV/AIDS-related programs, either in the short or mid terms, at national government levels. This situation is more compromised in the provinces, where the conflict of sector interests is more intense.
The diagnostics activities, treatment, care and support, were not significantly affected in global terms so far by the world economic crisis. In 2009 we expect an increase in the medication-assisted population of 10%. Besides, we seek to intensify condom distribution. Anyways, in 2009 second line drug funds were reduced, and in the last couple of months there was a greater affectation of the service provisions related to food/nutrition support to people on ART and prevention for groups most at risk. In the short and mid terms, we expect the impact not to affect the ART supply access. In connection with the crisis impact in the future, the experiencie indicates that the cut is in the third sector financing, which implies pair work. In this respect, we expect a reduction in the targeted programs for IDUs, MSM, sex workers and young people.
From the point of view of groups of PLWH, in general terms, in 2009 there has an abandonment of the implemented programs impacting the most vulnerable populations. The main potential implications of the crisis for the beneficiaries can be summarized as: i) bigger impoverishment and deepening of the problem of compromised indigent people. Increase in sex workers to meet their basic living needs. Bigger risk of virus transmission; ii) discontinue or abandonment of treatment; iii) life projects of people being thrown away, and iv) higher risk of death of people in social abandonment.
In sum, it can be said that even though the risk of a profound crisis impact in the HIV-AIDS sector seems unlikely in Argentina, the government is not directly providing assistance on this threat. In spite of the presence of certain crisis mitigation actions – though discontinued and isolated – it must be pointed out that there is no integrated plan which groups together the different sector and government levels, or the non-government actors working in the sector.
Recovery with a Human Face
Type: Impact study (On going, not yet completed)
Participating UN Agencies: UNICEF Abstract
Analyze and prioritize budgets for social and economic recovery, enabling spending to provide immediate and adequate support to children and women (scaling up social protection, maintaining/increasing core social expenditures, protecting pro-poor expenditures aimed at economic recovery and at raising household livelihood). Identify sources of fiscal space; Conduct a rapid assessment of the social impacts of different policy options, including how the crisis/post-crisis adjustments may cause retrogression in the realization of children’s rights and which policy options will best assist governments to meet their obligations enshrined in the Convention on the Rights of the Child; Present a set of policy options for social and economic recovery that can be used in a national dialogue on crisis responses and post-crisis policy adjustments.
ILO has, in the context of the 98th International Labor Conference held in 2009, facilitated a Joint Statement by the Labor Ministers of Mercosur member states on the need to address the crisis with measures mainly aimed at preserving employment. This involved enhanced protection systems, seeking actions to preserve jobs and the support and strengthening of employment programmes addressed at vulnerable population groups. Further, the Argentine government has formally requested the admission of ILO to the G20, so that the proposed job preservation and creation is included among the policies to overcome the crisis.
At the Crisis Observatory of ILO’s Regional Office for Latin America and the Caribbean there are updated data and follow-up on the Argentine situation in the context of a comparative perspective with other countries in the region. See also http://www.mecon.gov.ar/basehome/pdf/indicadores.pdf , whereby the Ministry of Economy and Finance monitors the main macroeconomic indicators, updated as of October 2009.
Similar information can be found at the Economic Indicators System of the ECLAC Argentina site: http://www.cepal.cl/cgibin/getProd.asp?xml=/argentina/noticias/paginas/5/6045/p6045.xml&xsl=/argentina/tpl/p1f.xsl&base=/argentina/tpl/top-bottom.xsl
Addressing the economic crisis and its effects on children. Actions taken as part of the cooperation programme.
Participating UN Agencies: UNICEF
Monitoring the overall impact of the recession through permanent consultations with government areas (Ministry of Economy and Ministry of Labor) and with key partners (CIPPEC, public and private universities and specialized consulting firms) in order to offset the lack of reliable statistical data on the impact of the recession, particularly during the first half of 2009.
Follow-up and monitoring of the various private poverty surveys conducted during 2009 to analyze the impact on children. In particular, these actions were based on the studies generated by the Barómetro de la Infancia released by the:
Argentine Catholic University (Universidad Católica Argentina): Argentina 2004-2008: Condiciones de vida de la Niñez y Adolescencia.
Barómetro de la Deuda Social Argentina, Issue No. 3, 2009, Arcor Foundation and Universidad Católica Argentina. http://www.uca.edu.ar/uca/common/grupo68/files/infancia1.pdf
Poverty surveys conducted by the firms: Ecolatina http://www.ecolatina.com/ec_informes.htm and SEL Consultores http://www.selconsultores.com.ar/index-home.htm
Advocacy actions to guarantee adequate financial allocations that ensure compliance with and protection of child and adolescent rights through effective public policies. This was accomplished through a study conducted with the Ministry of Economy and Finance on social expenditure aimed at children, in the launching of which some political difficulties were encountered. See Gasto Público Social en Argentina dirigido a niños, niñas y adolescentes (Social Public Expenditure in Argentina targeted at children and adolescents). Ministry of Economy and Finance, UNICEF. 2009. http://www.unicef.org/argentina/spanish/resources_10853.htm