Argentina defends the title of Champion in the America Cup that is played in the United States, but it is far from having the best economic indicators. According to a report prepared by Focus Market, in some of the main measurement parameters, such as inflation, poverty or GDP per capita, the country is among the worst qualified, to the point that, if that were the competition, it would be eliminated in the first round.
“In Argentina there is a pending tournament which is the economy. In comparative terms with the rest of the countries in the region, Argentina has very bad indicators. For a long time we tried to bend the best practices of the rest of the countries in the region, which with their inconveniences and problems managed to reduce their levels of poverty and indigence in recent decades. However, in our country the poor and indigent increased in the same period,” he noted. Damián Di Pace Director from the Focus Market Consulting Firm.
Focus Market highlighted that, in a hypothetical economic tournament, there would be two countries that have led the world ranking regarding inflation, which are Argentina and Venezuela“coincidentally the two countries that have used to exhaustion the financing of the fiscal deficit via monetary emission.”
In this tournament, says Di Pace, Argentina loses by a landslide to any other team. It closed in May 2024 with an annual inflation of 276.4 percent. In this match, Argentina would lose 69 to 0 since its value is 69 times higher than the median inflation for all of America.
Group C presented the best performance, where Panamawhich is the country with the lowest inflation. “This may be due to the fact that in its economy the freely circulating currencies are the Balboa (domestic currency) and the dollar, with a fixed parity of 1 Balboa = 1 US dollar. Boliviain this group with the interannual inflation rate of 3.5%, is disqualified as it is a very competitive group; if it were to participate in any of the other three groups, it would qualify for the quarter-finals,” they indicated.
Public spending as a percentage of GDP is a good measure to compare the volume of the public sector in a given economy and represents the expenditures contemplated in the national budget that are intended to finance social security, education, health, transportation and energy, among others. parameters. These expenses must be financed with the resources obtained from the different tax revenues (taxes, duties, fees). An issue associated with expenses and income is the fiscal surplus or deficit, in the first case the income is greater than the expenses; When expenses are greater than resources, a deficit is incurred that must be financed with new taxes, debt or monetary issue.
Within group A, our country would qualify for the quarterfinals, if it were the size of the State, with public spending of 37.28% of its GDP. However, we should not lose sight of the fact that it is the country with the largest fiscal deficit, with 3.85% of GDP. The opposite case is Chilisince it was declassified due to its volume of public spending, but it presented a fiscal surplus of 1.36% of its GDP.
In group D is Brazil which is the country that exhibits the highest public spending of the entire competition with 46.38%, it is practically at the levels of Nordic countries that have the highest public spending in the world. Costa Rica It is also part of group D and shows the lowest spending, representing 19.43% of its economy.
Venezuela It is a case worth analyzing due to its poor performance, since it did not qualify for the quarterfinals and at the same time had a fiscal deficit of 13.7% for the year 2022.
If we leave aside the Gini index for a moment we can determine that GDP per capita is a good approximate indicator of national income and social well-being. As expected, North American countries are the ones with the highest GDP per capita, topping the list. USA with a GDP per capita of USD 76,330 annually and Canada with USD 55,522, far from its competitors. What is striking is the impoverishment of Venezuela due to the recurrent economic and political crises, to the point of having per capita income of a poor country and far below competitors in group C. Argentina in its zone A would not qualify for the next phase due to its GDP per capita.
“How many dollars should each of its citizens pay to pay off their country’s debt?” asked Damián Di Pace. “In Group A, in the case of Argentinanot only has the highest debt per capita compared to its rivals, but also has problems financing that debt due to loss of institutional credibility over time,” he said.
Group B is made up of countries where the debt per capita is lower than the other groups. Bolivia It has the GDP per capita of a poor country, but at the same time it is the one with the lowest debt per capita. Canada It has a GDP per capita that is USD 55,522 and its debt per capita is USD 7,656, concluding that it is a rich and little indebted country. USA It is a rich country with GDP per capita USD 76,630 but its debt per capita is USD 87,875, so much so that the median of all countries is USD 6,796, the US is twelve times higher than the median.
“Given the volume of debt, the first thing we can observe is that the US is a highly indebted country. It is the only country in the Copa América whose debt is greater than its GDP. To have an order of magnitudes of how much the total debt of the United States is, multiplying by 5 times the debt of the other 15 countries participating in the cup, the debt of the United States is not equal,” the economist analyzed.
According to poverty measurements of each country. Venezuela and Argentina They would be eliminated by a landslide in the first phase, given that their populations are the poorest in the entire cup. “This result invites us to reflect on the consequences of inflation on poverty. The two countries that recorded the worst results in both subjects,” said Di Pace.
“Due to the distribution of the groups, they would play the Copa America final United States vs Canada, where Canada would win by the greatest number of points. The two countries went to the quarterfinals in 4 of the 5 variables, the variable that was declassified is the debt per inhabitant. Our country in this competition would obtain a very poor result, given that in general terms it would obtain position 14 of the 16 participants,” summarized the director of Focus Market.
“The only way to increase the level of well-being of a population is for the economy to grow sustainably for decades. The more it is produced, the more employment is generated and it is the real bridge to the best income. To this we have to add that in recent times we have become the country with the highest inflation in the world, which is a machine for destroying the pocketbook and aspiration of society to give stability to decision-making in terms of investment and eliminating possibilities of basic consumption. in middle and low social sectors,” indicated Damián Di Pace.
