Public external debt as a possibility and limitation for Latin American development: The case of Argentina, 2015–23

Abstract

This study aims to investigate the dynamics of Argentina’s public external debt between 2015 and 2023, with a particular focus on the expansion of this variable within the context of a stagnant economy and persistent high inflation. Argentina has often been characterised as a ‘serial defaulter’, and after restructuring its sovereign debt between 2005 and 2010, the country defaulted once again in 2019/20. Consequently, Argentina undertook a new sovereign debt restructuring process, involving both private creditors and the International Monetary Fund (IMF) between 2020 and 2022. The research will adopt a theoretical approach grounded in the political-economy tradition of Latin American thinkers, while also comparing it with alternative frameworks, such as Buchanan’s public choice theory. Dependency theory will be employed to examine diverse perspectives on sovereign debt management and to position the Argentine case within a global context. This study will trace the evolution of Argentina’s external debt, focusing particularly on the period from 2015 to 2023, while also exploring key milestones in the country’s debt history since 1976. The analysis will address the characteristics of debt restructuring, the various alternatives to default and the potential limitations and opportunities for economic development in peripheral countries, particularly in light of the ‘structural power of finance’. Methodologically, the research will conduct a political-economy analysis based on the concept of the regime of accumulation (Boyer), alongside core–periphery theory (Marini and Prebisch). It will also examine the specific dynamics of sovereign debt (Ross) and the ethical dimensions of debt default (Buchanan).