**Figure 10. Import Content of Exports by Manufacture Sectors, Argentina, 1997**

<!-- Start of picture text --> 50<br>45<br>40 45<br>35 41 41 39<br>30<br>33 32 32 31<br>25<br>20<br>15<br>10<br>5<br>0<br>Motor vehicles Radio and TV Fertilizers and Office and Tubes & radio, Synthetic Other Motorcycles,<br>receivers pesticides computer TV and manufactured chemical bycicles and<br>science telephony fibers products other means<br>machinery transmitters of transport<br> Source : Author’s calculations based on INDEC data.<br>3. TRADE PERFORMANCE<br>Structural transformation in Argentina has been scarce, as evidenced by the fact that the<br>Argentinean basket and structure of export products has not changed dramatically over the past<br>. This results in a relatively low and stagnated sophistication of its exports, and specialization<br>in activities that appear to offer relatively little scope for technological catch-up to the world frontier.<br>At the same time, Argentina’s exports are well diversified compared to the average in LAC, even<br>though product concentration has increased over the past decade. In 2007 almost 30 percent of<br>total exports were concentrated in ten products, up from 25 percent in 1997 (Table 1). The product<br>concentration index (Figure 11) has been stable over the last decade, with a slight increase in 2001-<br>2003 (clearly due to a decrease in exports diversification due to the crisis) and then a decrease in 2003-<br>2006. The recent decrease is probably related to a revival in manufacturing after the crisis related to<br>the commodity boom and import substitution following the devaluation of the peso and the rebound in<br>domestic demand. Compared to LAC’s average and other competitors like Chile and Russia,<br>Argentina’ product concentration is fairly low. However, Argentina’s product concentration is high<br>compared to other important competitors such as Brazil. Moreover, product concentration started<br>increasing again in 2007, a sign that the country may need to reconsider boosting export<br>diversification in its trade policy.<br>Figure 11. Product Concentration Index for Argentina and Main Competitors 1990-2007<br>0.50<br>0.45<br>Argentina<br>0.40<br>Brasil<br>0.35<br>Chile<br>0.30<br>0.25 China<br>0.20 Russia<br>0.15 Mexico<br>0.10<br>Turkey<br>0.05<br>LAC<br>0.00<br>Source: COMTRADE and own calculations.<br>Imports content of exports (%)<br>1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007<br><!-- End of picture text -->

**Structural transformation in Argentina has been scarce, as evidenced by the fact that the Argentinean basket and structure of export products has not changed dramatically over the past decade.** This results in a relatively low and stagnated sophistication of its exports, and specialization in activities that appear to offer relatively little scope for technological catch-up to the world frontier.<sup>7</sup>

**At the same time, Argentina’s exports are well diversified compared to the average in LAC, even though product concentration has increased over the past decade.** In 2007 almost 30 percent of total exports were concentrated in ten products, up from 25 percent in 1997 (Table 1). The product concentration index (Figure 11) has been stable over the last decade, with a slight increase in 20012003 (clearly due to a decrease in exports diversification due to the crisis) and then a decrease in 20032006. The recent decrease is probably related to a revival in manufacturing after the crisis related to the commodity boom and import substitution following the devaluation of the peso and the rebound in domestic demand. Compared to LAC’s average and other competitors like Chile and Russia, Argentina’ product concentration is fairly low. However, Argentina’s product concentration is high compared to other important competitors such as Brazil. Moreover, product concentration started increasing again in 2007, a sign that the country may need to reconsider boosting export diversification in its trade policy.

7 Sanchez, G. and Butler, I. (2008), Competitiveness and Growth in Argentina: Appropriability, Misallocation or Disengagement? IERAL - Fundación Mediterranea.

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