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„Me llega un informe del UBS comparando Argentina con Brasil. Lamentablemente no lo pude encontrar online. Y sería un poco largo para traducir. Así que pegoteo aquí el resumen ejecutivo:

(EX-POST: en este lugar puede accederse al documento completo, via Eduardo Levy Yeyati)

Pele or Maradona?
Argentina and Brazil’s rivalry cuts across many fields. While it’s in football where it has attracted the most attention, investors oftentimes also benchmark these two countries against each other.

Brazil ‘o jogo bonito’ and Argentina ‘catenaccio’?
Market perception about these two countries couldn’t be more contrasting. In recent years, Brazil has become the ‘model student,’ grabbing major attention as it’s become a key player on the global scene. At the same time, Argentina’s been cast into the spotlight as the ‘l’enfant terrible.’

Argentina 1 – Brazil 0
Comparing key flow macro variables, Argentina has done better. GDP growth has been higher than Brazil’s consistently. Brazil may be generally perceived as market friendly and Argentina as anti-business, but investments to GDP ratios have been much higher in Argentina. Brazil is also typically seen as fiscally prudent and Argentina as somewhat fiscally reckless and yet Argentina posts better fiscal numbers while the level of public spending in both countries is essentially the same. Contrary to conventional wisdom, Argentina has grown exports, especially
of manufacturing origin, faster than Brazil, notwithstanding Argentina’s antiexport policy bias. This has helped Argentina post higher current account balances
on a consistent basis.

Argentina 1 – Brazil 1
We think Brazil may be better positioned when comparing stock variables. Its gross public sector debt ratio is higher than Argentina’s but a) the Brazilian treasury has more liquid assets and b) Argentines don’t reflect the large stock of
GDP warrants and holdout debt in its statistics. Brazil’s advantage is more visible on the external side. Its debt ratios are much lower and its foreign reserves leave Argentina’s in the dust.

Offside
Both countries face serious inflation problems. However, Argentina’s are considerably more severe. Its inflation rate is about three times higher than Brazil’s, its Central Bank doesn’t appear too preoccupied with it and there are signs of
significant inflation underreporting. That said, high inflation in Argentina hasn’t so far come back to bite the country’s high growth in domestic aggregate demand.

Fair play, the rules of the game and the hand of Diego
It seems Brazil may be carrying an advantage when it comes to institutional-related matters and other non-quantitative factors. The Argentines have relied more on discretion than rules, undermining institutions and investors’ confidence in the process. When it comes to a host of competitiveness metrics, Argentina doesn’t
appear to be faring worse than Brazil.

30 minute extra time and penalty kicks
The jury is still out as to whether we’ll see Brazil outperforming Argentina more visibly. So far, their relative economic performance has not lived up to the Brazil hype and ‘Argentina bashing’ built up in the market over the past few years. We do feel more comfortable with Brazil’s policy stance and, barring political breakthroughs in Argentina, we would expect this country to fare somewhat better than its southern neighbour and perennial rival.

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