By Thomson Gale
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Extra resources for Worldmark Encyclopedia of the Nations. Americas
Industrial goods represented approximately 31% of exports in 2002. 5% decrease. Packing and processing of foodstuffs is the oldest and most important industry in Argentina. Beginning in the last part of the 19th century, the great frigoríficos, or meat-packing plants, were founded to prepare beef for export to Europe. In recent times, the Argentine government has entered directly into the meat-processing enterprises, which for many years were under British ownership. The textile industry was also developed quite early, making use of wool from the vast herds of sheep and the cotton from Chaco Province.
The only nontariff barrier is the tariff/quota system applicable to auto and auto parts imports. The Argentina/Brazil auto agreement establishes preferential market access treatment for both countries. A surge in imports during 1991/92 shifted the trade balance from a large surplus to a deficit position. The strong increase in imports is explained by several factors: first, the dynamic growth of the domestic economy which resulted in greater import demand; second, the reduction of import tariffs and elimination of nontariff barriers which released pent-up demand for imports; and third, the real appreciation of the peso which made imports much less expensive since the local currency cost of these goods rose by much less than the accumulated inflation since the beginning of the Convertibility Plan.
Social and political chaos ensued with the economy going into its worst recession in decades. After his party lost the midterm elections in 2001, President de la Rúa popularity continued to fall and the economic situation became unbearable. After protests turned violent in Buenos Aires in December 2001, looting and chaos erupted, followed by police repression. De la Rúa was forced to resign. After a few weeks of political instability, the Senate chose Eduardo Duhalde, who had been elected to the Senate in the 2001 midterm election, as a temporary president.