PESTEL analysis of Argentina (Profile of Argentina)
This is a comprehensive PESTEL analysis of Argentina (Profile of Argentina). It evaluates how the country is influenced by the macro factors. Argentina is a beautiful country. It ranks high in Human Development Index. It is officially known as the Argentine Republic.
Political forces that affect Argentina
Argentina is a federal constitutional republic. The president is both the head of government and the head of state and has the power to exercise executive power. Argentina is one of the largest countries in the world, and the second largest in South America.
Argentina is a regional power. It is considered a middle power on the global stage. It is member of several prestigious international institutions e.g. the UN, WTO, World Bank, Mercosur, OAS, G-15, and G-20. It maintains good relations with many countries and participates in the UN peacekeeping missions. However, it has disputes with the UK over the sovereignty of Falkland Islands.
Argentina has made a lot of progress in many different fields over the years. However, use of excessive force by the security forces, violence against women, poor prison conditions, and violation of indigenous rights are some of the challenges that slow down the progress and damage the reputation of the country.
Economic forces that affect Argentina
Another issue to discuss in the PESTEL analysis of Argentina (Profile of Argentina) is the country’s economic environment. The GDP in 2020 was worth around $383.10; however, it is expected to reach $443.00 by the end of 2023 (Trading Economics, 2021). Argentina is the 3rd largest country in Latin America in terms of GDP (Romero, 2021).
Argentina’s top exports are soybean meal, corn, delivery trucks, soybeans, and soybean oil. The major buyers are Brazil, China, the USA, Chile, and Vietnam. On the other hand, Argentina regularly purchases cars, refined petroleum, vehicle parts, petroleum gas, and soybeans from countries such as Brazil, China, the USA, Germany, and Paraguay (OEC, 2021).
Argentina’s leading industries are agriculture, food processing and beverages, oil, electronics, and textile. It is a land of vast natural resources and has opportunities in many different fields. However, it was hit badly by the global lockdowns in 2020/21. Likewise, urban poverty, and unpredictable booms and recessions impact on its economic development.
Social forces that affect Argentina
The current population of Argentina is nearly 46 million (Worldometer, 2021). Male life expectancy is 73.5 years, while female’s is 80.3 years. Spanish is the official language, though some other languages are also in use. Relaxed and family-focused lifestyle, delicious cuisine, and affordable cost of living have made Argentina a good place to work and live.
Argentina is a football crazy nation. Football is in fact the most popular sport and has become part of its culture. The country has presented many great footballers who have mesmerised their fans around the world. Particularly, late Diego Maradona, and Lionel Messi are two of the greatest footballers ever in history.
The quality of life in Argentina is among the highest in South America. The adult literacy rate is excellent, and the education system is of high quality as well. However, as Spanish is the main language of instruction in most public schools, the children of expats may have to look for international schools in the country.
Poverty is a big challenge for Argentina. In fact, it worsened recently due to the strict lockdown measures. Gillespie (2021) reports that the poverty rate increased to 42% in the second half of 2020. 16% of the residents in Buenos Aires live in poverty though the city has a reputation of wealth. Poverty has in fact increased inequalities in the country. Similarly, growing street crime is a cause of concern as well.
Technological forces that affect Argentina
Argentina has upped its tech game and is competing well with some of the most technologically advanced countries in the world. It is one of the best countries in the world in technological skills such as computer networking, operating systems, human computer interaction, databases, security engineering, and software engineering. Its universities are very focused on developing technological skills, and the government support is very good as well. In fact, it is a key global outsourcing centre for software development.
Online shopping in increasing rapidly, and Argentina is now the 3rd largest e-commerce market in Latin America. Social networking sites are driving people to online shopping. Many people like shopping through mobile devices and the trend is likely to continue in coming years. In 2020, purchase through mobile devices was worth $5 billion which is forecast to reach $13 billion by 2024 (Pasquali, 2021). However, one of the challenges for the country is to keep its tech graduates in the country as many of them go abroad for better career opportunities.
Environmental forces that affect Argentina
There are many things in Argentina e.g. national parks, lakes, scintillating landscape, cuisine, mountains, skis, UNESCO World Heritage Sites, and architecture that fascinate both local and international tourists. However, the country faces a number of environmental challenges such as air pollution, loss agricultural lands, and deforestation. Likewise, it is also affected by natural disasters such as seasonal floods, volcanic activities, wildfire, and extreme heat.
Legal forces that affect Argentina
The last element in the PESTEL analysis of Argentina (Profile of Argentina) is the legal environment. Argentine judiciary is independent from the Executive. There is a minimum wage in the country and employment law applies to all workers. Workers’ right is protected by the national Constitution, and discrimination is prohibited.
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Last update: 22 July 2021
Gillespie, P. (2021) Poverty in Argentina climbs to 42% after historic recession, available at: https://www.bloomberg.com/news/articles/2021-03-31/poverty-in-argentina-climbs-to-42-after-historic-recession (accessed 22 July 2021)
OEC (2021) Argentina, available at: https://oec.world/en/profile/country/arg (accessed 20 July 2021)
Pasquali, M. (2021) E-commerce in Argentina – statistics & facts, available at: https://www.statista.com/topics/6710/e-commerce-in-argentina/#dossierSummary__chapter1 (accessed 22 July 2021)
Romero, T. (2021) Gross domestic product (GDP) in Latin America and the Caribbean in 2020, by country, available at: https://www.statista.com/statistics/802640/gross-domestic-product-gdp-latin-america-caribbean-country/ (accessed 18 July 2021)
Trading Economics (2021) Argentina GDP, available at: https://tradingeconomics.com/argentina/gdp (accessed 19 July 2021)
Worldometer (2021) Argentina population, available at: https://www.worldometers.info/world-population/argentina-population/ (accessed 22 July 2021)
Author: Joe David
Joe David has years of teaching experience both in the UK and abroad. He writes regularly online on a variety of topics. He has a keen interest in business, hospitality, and tourism management. He holds a Postgraduate Diploma in Management Studies and a Post Graduate Diploma in Marketing Management.