Join GlobalBizzNetwork and start your international business network today.
There has never been a more optimum time to start doing business in Argentina, with the country’s economic growth anticipated to reach 3.1% by 2019. Being a major global player in the production of agricultural commodities and boasting the second largest manufacturing ability in South America, the Argentinian market is a beneficial one to do business in.
Argentina has a large fiscal deficit, having recently experienced an economic downturn, which may pose a challenge to a market entrant. However, despite having the sixth highest Corporation Tax Rate in the world at 35%, Argentina made paying taxes less costly in 2017 by increasing the threshold for the 5% turnover tax. Improvements to the online portal for filing taxes has also made paying the levies easier.
The Argentinian government is proactively involved in the country’s business relations, frequently implementing new measures in a bid to stabilise the nation’s business environment and placing a tight control on trade and access to foreign exchange. This active involvement of the administration, in part, led to the World Bank ranking Argentina 117 out of 190 counties for ease of doing business in 2018.
Great value is placed on personal relationships when doing business in Argentina. In a country which was previously beset with political instability, reliance on strong long-term relationships remain an important factor. If those intending to do business in Argentina are prepared to do their research and adapt their business style to complement Argentinean culture, fruitful professional relationships should result in prosperous business gains.
- Energy: Oil & Gas. High quality shale resources and strong support from the Argentine government to encourage exploration and production in Vaca Muerta and elsewhere. Argentina is auctioning offshore exploration and production opportunities for the first time in decades.
- Renewable Energy: Oversubscribed energy auctions from renewable sources continue to present medium and long term business opportunities.
- Agricultural Technology and Machinery: Two-thirds of Argentina’s exports are agricultural. The depreciation of the Argentine peso coupled with a predicted stronger harvest in 2019 are expected to boost Argentina’s agricultural production, exports and investment in the sector.
- ICT and Cybersecurity: The Government of Argentina is proposing a new telecom convergence law to increase competition and accelerate technology uptake. GoA estimates a $20B telecom investment over 4 years.
- Design & Construction: Public Private Infrastructure Projects will be significant and have attracted the re-engagement of OPIC (Overseas Private Investment Corporation) in Argentina. The Inter-American Development Bank ($4.65B) and World Bank ($3.3B) have also committed funding for new roads, rail, ports and utilities. However, federal spending cuts and Argentina’s current high “country risk” level means $55 billion in planned PPP infrastructure projects (planned 2017- 2025) are currently on hold.
- Healthcare Technology: The Government of Argentina is emphasizing efficient spending, accessibility, and modernization, including e-health through their National Healthcare Plan. The city of Buenos Aires plans to upgrade 14 hospitals.