UPSC Prelims 2003 Q134: Current Affairs – Business & Economy
What was the main reason for a great civil strife in Argentina recently?
- (a) Ethnic conflict between the native Red Indian tribes and others
- (b) Economic crisis due to huge public debt
- (c) The issue of using native languages as medium of instruction in schools
- (d) Clashes between government troops and secessionist groups
Answer: (b) Economic crisis due to huge public debt
Explanation
Civil strife in Argentina
| Option | Cause |
|---|---|
| Economic crisis due to huge public debt | Yes — the 2001-02 crisis, default and bank freeze |
| Ethnic conflict | No |
| Language in schools | No |
| Secessionist clashes | No |
The civil strife in Argentina in 2001-02 was due to a severe economic crisis caused by huge public debt, default and banking restrictions.
Answer: (b) Economic crisis due to huge public debt.
Why each option is right or wrong
- (a) Incorrect. Argentina has no major Red Indian ethnic conflict.
- (b) CORRECT. The economic crisis led to riots.
- (c) Incorrect. Language was not the issue.
- (d) Incorrect. There were no secessionist clashes.
Key point
Argentina: peso peg to the dollar ended Jan 2002; default $93 bn; bank corralito.
Remember
Argentina's strife was caused by an economic crisis and public debt.
Common mistakes
- Looking for an ethnic reason in the news.
- Mixing it with Bolivia's gas conflict.
- Forgetting the dollar peg collapse.
Exam tip
Argentina 2001: the largest sovereign default then.
Sources
- International Monetary Fund, Independent Evaluation Office — The IMF and Argentina, 1991–2001 (2004)
- Encyclopaedia Britannica — Argentina