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GOVERNMENT FINANCE AND PUBLIC MONEY
Why governments fail financially
Borrowing
increases
DEBT
GROWS
Borrowing
increases
DEBT GROWS
- Argentina’s
repayments are
still too small to
control rising
levels of debt.
3. Its repayments
fail to bring the debt
under control. - The countries it has
borrowed from lose
faith in Argentina’s
ability to pay. - Argentina
borrows heavily
from elsewhere
in the world.
$
$
$ $$
$
DEBT
- Argentina fails
to meet conditions
set out by the IMF - The IMF on deficit targets.
withdraws its
economic support. - The value
of the peso
plummets. - A run on the
banks leads to the
government
freezing deposits. - Argentina
cannot repay its
US$120 billion
debt, and defaults. - Argentinian
unemployment
reaches 20%. - Civil unrest
and rioting break
out.
Argentina
defaults
- A period of
political instability
sets in.
16. Agreements
on repayments
in 2002 help
promote a boom.
Argentina
e
n
te
r
s
a
d
e
b
t
s
p
i
r
a
l
$
€ 107 billion
amount of Greek debt
written off i n 2012
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