Argentina: Economic momentum is solid


Is Argentina the next emerging market? Is it too late to climb aboard? With the country on track to post a strong fiscal trade surplus and growth this year, this momentum should carry through 2011. It has been reported that Argentina's central bank expects gross domestic product to expand between 8.9% and 9.5% this year due to private consumption and higher exports to key trading partners such as Brazil and China.

As China seeks new relationships to secure long-term sources of key commodities like food and oil, Argentina may expand even faster than normal. Even during the international financial crisis, Argentina was able to grow its economy 0.9% -- and that was before its connections with China were as well developed as they are now. In fact, some traders even characterize Argentina as a nice downstream play on the China boom.

Strong growth is fueling increased tax revenue, and Argentina is expected to end the year with a fiscal surplus of about 1.4% of GDP and a trade surplus of over $11 billion. While there is no pure ETF play for Argentina, there are at least two that offer various blends of stocks from Argentina, Brazil, Chile, China and others: iShares S&P Latin America 40 Index Fund ILF and PowerShares DWA Emerging Markets Technical Leaders PIE.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.

This article appears in: Investing , ETFs , Investing Ideas , International

Referenced Stocks: ILF , PIE

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