During May 1989, the exchange rate (while fixed in theory) rose from 80 to 200 australes to the dollar. In 1989 Carlos Saul Menem, a Perónist and former state governor, was elected. This led to an average annual inflation rate of 300% between 1975 and 1990. He immediately announced a new shock programme, this time with more fiscal adjustment in view of a government deficit of 16% of GDP. JSTOR is part of ITHAKA, a not-for-profit organization helping the academic community use digital technologies to preserve the scholarly record and to advance research and teaching in sustainable ways. This disaster was accompanied by … Wednesday, 24 May was a bank holiday. Request Permissions. Menem was the son of Syrian immigrants to Argentina. Argentina, Bolivia, Brazil, and Mexico—beginning in the mid-1980s. Tasas de inflación e hiperinflación en Argentina en 1989 y 1990. The first was the There was a shortage of basic products in supermarkets and stores, and their price tags were updated several times in the same day. It publishes over 2,500 books a year for distribution in more than 200 countries. The first riots started in Rosario, the third-largest city in the country, when people demanded supermarkets to give away food; they quickly spread to other cities, specially in Greater Buenos Aires. Argentina was well on the path of the economic reform process and it is only in the late 1990s (after 1997) that the signs of the crisis began to emerge. The cycle of rising prices and wages to meet those prices spiraled out of control. 1990. All four experienced high infla-tion, with periods of hyperinflation in Argentina during 1989, in Bolivia during 1985, and in Brazil during 1990. That night the riots and episodes of looting became generalized in Rosario, especially in the southern neighbourhoods, where most of the larger supermarkets were concentrated at the time, and the next day they spread to the nearby industrial corridor and to other cities, accompanied in certain cases by road blockades and cacerolazos. Hyperinflation is caused by a violent distributive conflict which generates a strong inflation, by indexation, by an external indebtedness denominated in a foreign currency and by self-fulfilling prophecies. Under Alfonsin Argentina again went through an episode of hyperinflation. Vol. The riots were contained quickly, again with delivery of food assistance to the poorer neighbourhoods. With respect to Argentina, no CPI was published by the Argentinian government or the IMF for certain months during 2015 and 2016. Though most were motivated by hunger and took only food, many also stole cash registers, furniture, refrigerators, etc. [4], The rioters broke into supermarkets, food stores and smaller businesses, in groups of varying size (as small as 20 people and as large as 1,000). More than 40 people were arrested, and there were 14 dead (20 according to unofficial reports). Journal of Latin American Studies https://www.reed.edu/economics/parker/f10/201/cases/Argentina.html This item is part of a JSTOR Collection. The riots were caused by the rampant hyperinflation and food shortage, and were associated with legal protests and demonstrations. Check out using a credit card or bank account with. This changed on 29 May, when the president declared a state of emergency for 30 days. The Convertibility Plan, introduced in April 1991, was designed to stabilize the economy through drastic, and almost irreversible, measures. 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