In 2002, Argentina’s GDP shrank by 64 per cent. An IMF-mandated austerity programme had deepened the country’s recession, tripling urban poverty rates in just three years. When the government hesitated to implement further cuts in late 2001, the IMF withdrew its assistance. The economy entered free fall.
Thirty-nine people were killed in a wave of protests and strikes that December, leading President Fernando de la Rúa to flee Buenos Aires in a helicopter. Fearing societal collapse, the new administration set about defaulting on the country’s debt, devaluing the currency and freezing utility bills. Though these measures eventually led the country out of crisis, they hit the profits of foreign multinationals, who promptly demanded $80bn in compensation.
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