When Argentina’s economy grows, imports generally rise faster than exports—unless commodity prices are sky-high. What happens next is fairly predictable: Argentina runs out of dollars, the depreciation of the peso kindles inflation, and borrowing dries up.
The resulting economic recession eventually reverses current account deficits, but poverty soars and incumbent governments overspend to quench social unrest (and win the next election). When a sovereign default is imminent, the government calls in the IMF—a plea for help that has taken place 22 times in Argentina’s history.
