How Investor-Friendly Reforms in Argentina are Creating Business Opportunities

“…for decades, we have been isolated from the world. But we are now opening a new phase. We are in a position to play a significant role on the international stage.” – Mr Mauricio Macri.

This statement, announced by the current Argentine President, reflects more than just a growing ideology in Argentina – it represents change. This change has been apparent through a diverse range of economic reforms in the South American nation. Some of these include:

• The lifting of foreign-exchange controls.
• Constitution of the Argentina Investment and Trade Promotion Agency.
• Creation of new type of legal entity called a Simplified Shares Company (S.A.S), which is significantly less complicated, time-consuming and expensive than other types of legal entities.
• Argentina hosting multilateral bodies – The World Trade Organization and the G20.
• Reduced importation/exportation taxes.

Investor Friendly Reforms in Argentina – Economy Overview

These initiatives, along with economic reforms, have created an environment for growth.  The Argentine economy is set to experience growth in 2018 and 2019 due to increases in private consumption and fixed investment. Panellists at ‘Focus Economics’ predict economic expansion to reach 3% in 2018 and 3.2% in 2019, some of the most attractive statistics across Latin America.

These initiatives, while encouraging foreign participation in the nation, bring an array of benefits for the local communities. As local companies (with foreign owners) set up business, they immediately require the skills, knowledge, and expertise of locals to ensure operational success. This does not only apply to major hubs such as Buenos Aires but for rural communities around areas containing valuable natural resources. These communities often benefit from economic activity in their regions, with royalties providing much-needed funds for local education, health, and infrastructure

Local Argentine Business Sectors

Argentina has always been ripe with business opportunities in a diverse range of sectors. These sectors, such as lithium, shale gas, renewable energy, agriculture, and tourism have remained stagnant over the years (due to economic struggles and lack of investment) and are now, due to the opening up the economy, are becoming of great interest to investors.

With deductions/eliminations in export taxes, many foreigners are looking for local Argentina partners to commence business operations with. Given that Argentina is the largest producer of soybean oil, the 2nd greatest exporter of soymeal, lemon and limes and the 3rd largest exporter of corn, there is significant investor interest in the country. With world population growing, Argentina’s agricultural industry is set to benefit greatly.

Given a large volume of corn imports, and a changing relationship with the USA, Mexico has already begun looking for new suppliers of their favourite vegetable, and Argentina has put its hand up to be their partner, with trade negotiations already underway.

Time to get Involved in Argentina

They say there is no time like the present, and this is certainly true for Argentina. Economic reforms now mean that business opportunities are more viable than ever, and many are taking advantage of increased opportunities due to the reduction in foreign restrictions and regulations. The nation’s highly educated population, high level of English, and strong/diverse local sectors place the region as one of the most attractive Latin American countries in terms of investment.

Get in contact with one our local experts and see how we can assist your investment in Argentina. From commercial representation, legal/accounting services to company formation services, we can assist in your project.

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