Question

What is Import Substitution Industrialisation (ISI)? What is the theory behind its adoption, and how successful was it in Argentina?

Answer 1

Import substitution industrialisation is a policy whereby foreign products and services are replaced by domestic products and services. The idea behind it is to reduce dependence on foreign countries and most importantly to industrialise rapidly. The protection from tariffs was believed to protect native infant industries from foreign competition, speeding their growth and ensuring their success of these industries. In Argentina this strategy failed. It became poorer and poorer. In 1973 it was one of the richest country. Now it has almost faded into insignificance.