Development: On 29 February Argentine media including the state news agency Telam reported that Industry Minister Débora Giorgi had asked several Argentine companies to substitute imports from the United Kingdom (UK) with alternative supplies.
Significance: The move is in line with the restrictive import policies being implemented by the government of President Cristina Fernández for the better part of two years now. Clearly, however, the move also has political implications, amidst the recent increase in diplomatic tensions over the Falklands/Malvinas archipelago. According to Argentina’s national statistics’ institute, Indec, Argentina’s imports from the UK were valued at a mere US$664.2m in 2011, constituting barely 0.9% of its total imports. This relatively small weight implies that the latest move is driven by politics primarily.
Key points:
• Argentina’s exports to the UK were valued at US$779.5m in 2011. However, its trade surplus with the UK shrunk 60% year-on-year in January-November 2011 to US$104m, down from US$274m in the same period of the previous year. Total bilateral trade was worth an estimated US$1.44bn in 2011, up 16.2% annually on 2010.
• According to the ministry of industry, the new measures are designed to halt the continued deterioration in Argentina’s bilateral trade surplus with the UK. Notably, the ministry says Argentina also wants to favour relations with “those who respect the territorial integrity of the country, its sovereign claims and the resources that belong to it”.
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