Academic journal article Canadian Journal of Latin American & Caribbean Studies

The Beginning of a Controversial Relationship: The IMF, the World Bank, and Argentina, 1943-46

Academic journal article Canadian Journal of Latin American & Caribbean Studies

The Beginning of a Controversial Relationship: The IMF, the World Bank, and Argentina, 1943-46

Article excerpt

The conflictive relationship between Argentina and the Bretton Woods Institutions, the International Monetary Fund (henceforth IMF or Fund) and the International Bank for Reconstruction of Development, better known as the World Bank (henceforth Bank), has attracted the attention of numerous economists and political scientists. The latter have mainly focused on the stand-by arrangements signed by the sides, as well as on their political, economic, and social consequences (Amadeo 2003; Blustein 2005; Bonelli 2004; Minsburg 2003; Mussa 2002; Tenembaum 2004). The economic crisis that erupted in Argentina in 2001 and the repayment of debts to the IMF by Nestor Kirchner's administration in 2005 have been at the heart of a global debate on the role played by the Bretton Woods Institutions in the debt crisis in areas such as Africa and Latin America. However significant the history of the Fund/Bank-Argentina relations is for an understanding of the relationship that evolved between the sides, there has been little critical examination of its early and formative stages. As is the case in most aspects of the origins of this tumultuous relationship, almost no research has been published on the possible reasons behind Argentina's late incorporation into the Fund and the Bank in September 1956--12 years following their creation and 10 years after all other countries on the continent. (1)

The aim of this article is to fill part of this gap by focusing on Argentina's exclusion from the foundational event of these prominent institutions--the Bretton Woods Conference held on July 1944 in New Hampshire. I argue that while Argentina, like other neutral nations, was excluded from numerous wartime international events, its exclusion from the Bretton Woods Conference was more than just another example of the high price of neutrality. This exclusion, which the Argentinean government insistently strove to reverse, represented in fact the starting point of its controversial relationship with the Fund and Bank.

The few historical studies that have so far addressed the formative stages of the relations between Argentina and the Fund and the Bank begin their narratives after the Peronist era (February 1946 to September 1955) (Brenta 2008; Garcia Heras 2000, 2008; Manzetti 1991). Only a few researchers provide some explanation regarding the chosen periodization or the late acceptance of Argentina into the Fund and the Bank. One leading (explicit or implicit) explanation for Argentina's enduring absence from these institutions is that it did not join until 1956 due to the persistent refusal of President Juan D. Peron to do so (Frenkel and Fanelli 1987; Galasso 2002, 175; Rapoport, Madrid, Musacchio, and Vicente 2000, 522). Other researchers note that during the years following the Peronist government, "Argentina joined the IMF and the World Bank, which Peron had accused of being vehicles of US imperialism" (Manzetti 1991, 34).

The question of whether Peron refused or aspired to join the Fund and the Bank is of unquestionable importance. However, in this article I argue that any attempt to explain Argentina's long absence from these institutions must start as early as the years preceding Peron's presidency. In other words, and contrary to what has frequently been argued in the academic literature, the dilemma that the Peronist administration had to deal with was not so much whether it was willing to join the Bretton Woods Institutions, but to what extent it was ready and able to put an end to its ongoing exclusion. Research based on primary sources in Argentina, the United States, and the United Kingdom, and on the only recently declassified Bretton Woods Collection held in the IMF Archives, demonstrates that the origins of Argentina's late integration into the Bretton Woods Institutions are rooted in the pre-Peronist era and in the time before the formal launch of the Fund and Bank activities in March 1946.

This article demonstrates that Argentina's ongoing exclusion from the Fund and the Bank in their formative years ought to be understood as a consequence of the country's decision to remain neutral during World War II and as a result of its longstanding enmity with the US government. …

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