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... recent of their beef supply. It was a general conviction within the British government during the war that without Argentine foodstuffs maintaining the standard of living of the British civilian population would be impossible and the war effort would be seriously compromised (Tulchin 88). On the other hand, such an analysis contains a fallacy in the fact that an increase in trade does not necessarily improve a country's economy.
In his book The Fitful Republic: Economy, Society, and Politics in Argentina, Juan E. Corradi offers exact evidence to counter Veganzones', Winograd's, and Tulchin's analysis. Having traveled all over the Latin America and co-chaired the seminar on Argentina at the Center for Inter-American Relations in search of evidence for his book, Corradi explains that: the wartime rise of meat prices... led many estancieros or ranchers to use land for grazing instead of leasing it for agricultural purposes. The shift to grazing before and during the Second World War added to the surplus of labor in the countryside, since ranching requires fewer hands (Corradi 237). Consequently, the money brought in by increased trade was offset by an increased amount of free labor.
Fired from their farms, these laborers went to large cities in search of jobs, where they could only find employment in industry. However, since wartime prices made heavy industrialization very cost ineffective, only light industry experienced any significant growth. After the war, this presented a real problem; the majority of Argentina's labor force was locked into light industry, but the only competitive products Argentina had to offer came from agricultural sources. In 1944, industrial production came to constitute a larger proportion of total production than production of raw agricultural materials. Still, after the war, 93 % of Argentine exports were agricultural, and only 2 % were manufactures (Ferns 164).
The majority of the population worked in the factories but the real money was earned on the fields and ranches; a serious disparity hidden by the war. Therefore, it becomes obvious that increased British demand for Argentine beef and increased foodstuffs trade spurred by the war only worsened Argentina's economy. Yet, there are still those who believe that the Second World War improved Argentina's economy by fostering closer economic ties with the United States. On October 14, 1941 Argentina and the United States signed a commercial agreement effective until November 14, 1944. Professors of Argentine foreign policy in Salvador University, Alberto Conil Paz and Gustavo Ferrari elaborate on this commercial agreement in their book Argentina's Foreign Policy, 1930 - 1962.
Citizens of Argentina themselves and having access to the Archives of the Ministry of Foreign Affairs, Paz and Ferrari give a detailed account of the provisions of this treaty. By virtue of this treaty, North American tariffs were reduced on 69 percent of the imports from Argentina, and it was guaranteed that existing customs duties would not be increased and that new ones would not be imposed. Argentina reduced tariffs on only 18 percent of her imports from the United States and promised not to increase existing tariffs... (Paz 61). The impacts of this lucrative treaty, for Argentina at least, are further upheld by Harold F. Peterson of State University College at Buffalo. Having served in the regions of Rio de la Plata during World War II and consulted the vast records of the Department of State, Peterson is considered an expert on the subject.
His argument further supports professor Paz's findings by confirming the sheer profit Argentina made from receiving a chance to unload its surpluses into a new market. Peterson offers the information included in Table 1 below. (Value of Argentine Trade with the United States in thousands of dollars, Table 1 from: Statistical Abstract of the United States, 1947, p. 915) Table 1 clearly shows that Argentina earned a sizable amount of money from her trade agreement with the United States (Peterson 412). Paz, Ferrari, and Peterson put forth the idea that Argentina's pre- 1941 surpluses were thereby converted into currency, a real boost for the economy. If the war had not broken out, such great demand for Argentine products on the American markets would have never been created and the Argentine economy would not have improved. However, all things should be put into their proper context, including the US-Argentine trade agreement. In this case, the proper context includes a United States boycott of Argentine economy.
Carlos Escude, Professor of International Relations, University of Belgrano, Argentina, and Senior Researcher, Instituto Tocuato di Tell, Buenos Aires, offers a more complete picture of the US-Argentine relations during the war. According to professor Escude, Argentina's neutrality during the Second World War forced the United States to initiate an economic boycott of Argentina. Beginning in February of 1942, the boycott lasted for seven years and concentrated on depriving Argentina of many vital supplies. Professor Escude argues that: Licenses were refused for the exportation to Argentina of steel machinery, railway replacement parts and rolling stock, petroleum equipment and chemicals, iron and steel, coal, fuel, oil, caustic soda and ash, tinplate, etc. , to a far greater extent than was justified by wartime scarcities (Tell 63).
It is important to note that all of these items are necessary for development of a heavy industry. Furthermore, professor Escude cites a State Department document, entitled "US Export Policy I towards Argentina", of February 3, 1945, which read: "Export of capital goods should be kept at present minimums; it is essential not to permit the expansion of Argentine heavy industry" (Tell 64). In the light of these facts, the US-Argentine trade agreement loses its initial appeal. While the trade agreement did put some cash into the Argentine piggy-bank, it did not allow Argentina to purchase the goods it needed the most; goods necessary for the further development of its heavy industry. In this manner, World War II worsened Argentine economy.
It shifted the focus of Argentine economy towards ranching, thereby increasing the work force available in the factories. However, the war also cut off Argentina from its primary European markets and forced the country to trade with the United States, who, in turn, through its economic boycott, was not willing to let Argentina develop what it needed the most -- its heavy industry. The end result of the US economic boycott of Argentina becomes a great irony; a land with great natural resources suitable for the development of a formidable heavy industry was forced to develop a huge, non-sustainable light industry. In closing, located on the tip of the southern cone of South America, almost 10, 000 miles away from the main stage of World War II, Argentina did not submit any troops to the conflict and even profited handsomely from sale of foodstuffs to the Allies. However, the Second World War did not improve Argentine economy. Instead, it slowed it down and created a false sense of security that, in the long run, wrecked the country's economy.
The final analysis, therefore, marks the Second World War as the event which tripped up Argentina's economy. The war started the process of Argentine under-development that, coupled with mismanagement and an unstable rule, has over the decades caused the country to plummet into the ranks of third-world nations. WORKS CITED Corradi, Juan E. The Fitful Republic: Economy, Society, and Politics in Argentina. Boulder, Westview Press, 1985.
Diaz, Carlos F... Essays on the Economic History of the Argentine Republic. New Haven: Yale University Press, 1970. Ferns, H. S. Argentina.
New York: Frederick A. Praeger Publishers, 1969. Humphreys, R. A...
Latin America and the Second World War: Volume One 1939 - 1942. London: Athlone Press, 1981. Lewis, Paul H... The Crisis of Argentine Capitalism. Chapel Hill: University of North Carolina Press, 1990. Paz, Alberto Conil and Gustavo Ferrari.
Argentina's Foreign Policy, 1930 - 1962. Trans. by John J. Kennedy. Notre Dame, University of Notre Dame Press, 1966. Peterson, Harold F.
Argentina and the United States: 1810 - 1960. New York: State University of New York University Press, 1964. Randall, Laura. An Economic History of Argentina in the Twentieth Century. New York: Columbia University Press, 1978.
Tell, Guido di, and Cameron D. Watt, eds. Argentina Between the Great Powers, 1939 - 46. Pittsburgh: University of Pittsburgh Press, 1990.
Taylor, Amos E... Political, Economic, and Social Problems of the Latin-American Nations of Southern South America. New York: Greenwood Press, 1949. Tulchin, Joseph S.
Argentina and the United States: A Conflicted Relationship. Boston: Twayne Publishers, 1990. Veganzones, Marie-Ange, and Carlos Winograd. Argentina in the 20 th Century: An Account of Long-Awaited Growth.
Development Centre Studies, 1997. Wanna, Gary W... Argentina: Illusions and Realities. New York: Holmes & Meier, 1992.
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