3. Evolution Of The International Investment Position In 1991-1998

In the period 1991-1998, the Argentine net debt IIP went from U$ 8,645 millions in 1991 to U$ 64,715 millions estimated as of end of 1998 (table 1 of the Annex). The net liability increase was the result of new conditions for emerging economies at the beginning of the decade, determined by the return of external credit due to payment normalization of indebted countries which gave rise to the Brady Plan implementation. This, together with availability of financing in international markets and the country’s structural economic reforms plan, finally resulted in external capital inflows under different modalities, thus allowing the financing of balance of payments’ deficits and the increase of international reserves and of other external assets.

The net deficit accumulation in the current account of U$ 62,531 millions during the last seven years basically explains the evolution of the IIP, as can be seen in graphs 3 and 4.

Graph 3

Graph 4