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Sector-specific opportunities

Research

You should carry out as much market research and planning as possible before exporting to Argentina, using both desk research and visits to the market. You need to determine if there is a market for your product or service and whether your pricing is competitive.

DIT’s trade specialists can help you identify local representatives for your products in Argentina. See: https://www.gov.uk/overseas-customers-export-opportunities.

DIT provides free international export sales leads from its worldwide network. Find export opportunities in Argentina at: https://opportunities.export.great.gov.uk/.

 

Government tenders in Argentina

Tenders over AR $800,000 must be by an open public tender. See the new Argentine Electronic Public Procurement Portal at: https://comprar.gob.ar/. Many of the provincial governments have their own websites with procurement information. The Unión Argentina de Proveedores del Estado (UAPE) has a database of government procurements. See: https://comprar.gob.ar/ for more information.

Because of the Argentine “Buy Local” initiative, many tenders require purchases of domestic goods, materials and products. Preference may be given to bids submitted by a domestic company or consultant, therefore you should check with the DIT team in Buenos Aires at: https://www.gov.uk/world/organisations/department-for-international-trade-argentina#contact-us for assistance and information about third-party advisers.

 

Agri-tech sector

Argentina is one of the greatest food producing and food exporting countries of the world. It has 36 million hectares of arable and permanent cropland. Agriculture production and the food and drink industry make up 16% of Gross Domestic Product (GDP). 70 to 95% of Argentina’s export earnings are traditionally supplied from agriculture and farming.

There is demand for:

  • technological innovation, such as farming process technology, precision agriculture and dairy industry improvements

  • quality standards

  • food security

  • Animal health, welfare and genetics

Contact the DIT team in Argentina at: https://www.gov.uk/world/organisations/department-for-international-trade-argentina#contact-us for further information and support.

[Source – DIT/gov.uk]

 

Commercial property/real estate sector

Argentina’s residential and commercial construction is characterised by its grace and versatility. From the majestic domes of Río de la Plata’s belle époque, to the modern office towers in all the cities of the country, Argentina’s architectural language communicates the nation’s history and progress. 

Construction is an essential sector for the country’s economy and is one of the main promoters of development. Not only does it generate a large part of employment, but it also invigorates other activities such as the production of cement, glass, bricks, paints, metal profiles, heavy machinery and every type of supply used in residential and commercial projects.

Recent developments

The Argentine State actively fosters measures to encourage construction, but it does so particularly because it is a priority to improve the population’s housing quality. 

An ambitious plan to build 120,000 homes and to re-urbanise 500 vulnerable communities has been recently set into motion. These measures will improve the housing situation of 4 million people, additionally spurring the sector’s growth and its capacity to create employment. 

Even though the Argentine State invests in numerous strategic sectors and will continue to do so in the future, it also calls upon the private sector to invest in construction and multiply developments, especially residential ones. 

The private banking system is already working with the National State to facilitate mortgage financing. Specific lines of credit adjusted by the price index have been established in order for deposits and instalments not to lose real value over a term of up to 20 years.

Investment opportunities

Considering the projected growth for Argentina’s economy in the coming years, prospects are encouraging for works that broaden the supply of offices, upscale residential neighbourhoods and shopping malls, all of which grant profitable return on investment. 

The joint work between the public and private sectors sets the foundation for construction’s progress and a propitious atmosphere for real estate development. 

Investing in the sector is backing an activity with high potential, continuing with a tradition of rich, diverse and innovative architecture.

[Source – Argentine Government – Investment and Promotion Agency (Agencia)]

 

Education sector

Argentina has the highest English language proficiency in Latin America. English is mandatory at state schools in the City of Buenos Aires and the Province of Buenos Aires. Many private schools are bilingual and attract many middle class students.

4.9 million netbooks have been given to children through the government programme ‘Conectar Igualdad’.

There is demand for:

  • educational software

  • English Language Teaching (ELT) products

  • joint ventures with local institutions for corporate and higher education programmes

Contact the DIT team in Argentina at: https://www.gov.uk/world/organisations/department-for-international-trade-argentina#contact-us for further information and support.

[Source – DIT/gov.uk]

 

Experience sector

Argentina has more than 1,000 museums, some already world class. Most of these are owned by federal or provincial governments.

There are opportunities for UK companies in:

  • planning museums and cultural districts

  • hosting international exhibitions

  • training in modern museum techniques and concepts, including self-sustainability 

Contact the DIT team in Argentina at: https://www.gov.uk/world/organisations/department-for-international-trade-argentina#contact-us for further information and support.

[Source – DIT/gov.uk]

 

Financial services sector

Financial services are vital vehicles to stimulate investments: the Argentine State is putting special emphasis on restoring the normal functioning of the institutions that actively participate in the sector, so as to regain trust and credibility and thus access new productive financing at gradually more convenient costs.

Standing out amongst the most important measures are:

  • Successful resolution of the trial for the suspension of payments, ending with years of legal conflicts that blocked the possibilities of obtaining financing from abroad in spite of boasting record-low debt burden, both historically and regionally. The issuance of debt enabled the Argentine State to close a chapter that was hindering its economic potential.

  • Removal of the foreign exchange restrictions that limited the private sector’s free access to foreign currency, having created a new environment of financial freedom.

  • Exchange rate correction, having eliminated the spread between the official and parallel exchange rates.

  • Withdrawal of the restrictions on overseas dividend transfers, which sought to prevent capital outflows from the country, but that also deterred their inflow.

  • Elimination of mandatory deposits for foreign investments and reduction of minimum waiting period for the funds transferred into the country, generating better financial conditions for foreign investment.

These decisions allowed for the reduction of country risk and for the lowering of financing costs. As a matter of fact, a considerable upswing has been witnessed in the foreign financing taken on by provinces and businesses, who detected a unique opportunity to fund their productive projects in this new context. 

Currently, the Buenos Aires Stock Exchange and the Buenos Aires Stock Market are moving forwards in the creation of a new market named B&MA (Argentina’s Stock Exchanges and Markets). This new development will give way to a further penetration of financial products and services, both for domestic and international investors.

Investment opportunities

Argentina’s financial system shows a notable growth projection due to the current solidness of all its indicators and the aforementioned advances. On this basis, the Central Bank of the Argentine Republic encourages the expansion of the banking sector to increase threefold its current size in the coming years. 

Financial services will play a crucial role in the forthcoming growth cycle and this reflects on the rekindled interest the international financial community shows in the country. Once again, the world trusts in Argentina and in the opportunity represented by the new cycle of growth.

[Source – Argentine Government – Investment and Promotion Agency (Agencia)]

 

Healthcare sector

Argentina has one of the highest doctor-to-population ratios in Latin America (3.8 per 1,000 inhabitants). The Argentine healthcare system is split into three distinct markets:

  • Public Health Service for 17 million people

  • Social Security for 18 million people

  • Private Health Service for 4.6 million middle-high income users

Argentina is the second largest market in Latin America for medical devices. However, only 25% of the equipment is manufactured locally. There is demand for:

  • imaging diagnostic equipment

  • orthopaedic implants

  • cardiology surgery supplies

  • in-vitro and organ transplant instruments

  • telemedicine and other top-end solution

Contact the DIT team in Argentina at: https://www.gov.uk/world/organisations/department-for-international-trade-argentina#contact-us for further information and support.

[Source – DIT/gov.uk]

 

Information and communications technology (ICT) sector

Argentina has one of the most dynamic mobile communications markets in Latin America, and the third largest in the region after Brazil and Mexico. Mobile phone penetration was about 140% by early 2016.

Argentina is an early adopter of ‘big data’ and other sophisticated technologies. It has the highest number of mobile phones per capita in the Americas and higher also than the UK. Its fibre-optic broadband network had increased by 300% by the end of 2015.

UK companies will have opportunities to:

  • supply mobile phone carriers with technology to improve network capacity

  • provide content for the broadband networks

  • enter joint ventures to develop software for processing big data

Contact the DIT team in Argentina at: https://www.gov.uk/world/organisations/department-for-international-trade-argentina#contact-us for further information and support.

[Source – DIT/gov.uk]

 

Infrastructure sector

The country has 53 airports, 22 of which are international. The most relevant airports are “Aeropuerto Internacional de Ezeiza (Ministro Pistarini)” and “Jorge Newbery (Aeroparque)”, the former is located in the Province of Buenos Aires and the latter in the Autonomous City of Buenos Aires. The other relevant ones are located in Mendoza, San Carlos de Bariloche in Río Negro and Córdoba. Argentina has embarked on an ambitious programme to update its airport infrastructure with modifications to terminal and airside systems in 19 airports, with a total investment of over US $900 million and an additional investment of US $122 million in improving air navigation services. There is demand for communication equipment, control tower equipment, instrument landing systems, lighting, navigation aids and radar systems.

Argentina’s rail network is the 8th largest in the world at 37,000 km, plus 60 km of underground in the City of Buenos Aires. The sector suffered from a lack of investment over a prolonged period. Since 2016, the Argentine Government has been implementing an investment plan of over £11 billion in the railway system. Requirements for technologies and services include:

   •     track renewal

   •     signalling equipment

   •     switches and crossings

   •     third rail improvements/ electrification

   •     regional express network project

   •     Public Private Partnerships and financial consultancy

The Argentine Government has also started to execute a major public investment programme for the construction of 2,800 km of highways; 4,000 km of safe roads; and 13,000 km of paving. Some of these projects may be delayed as part of the revised capital investment programme agreed with the IMF in June. This context presents trade and investment opportunities in infrastructure, favoured by the possibility of accessing international capital markets.

This context presents investment opportunities in infrastructure, favoured by the possibility of accessing international capital markets.

Contact the DIT team in Argentina at: https://www.gov.uk/world/organisations/department-for-international-trade-argentina#contact-us for further information and support.

[Source – Argentine Investment & Trade Promotion Agency (Jan 2018) DIT/gov.uk]

 

Mining sector

Opportunities in the mining sector are increasing in Argentina due to:

  • changes in legislation

  • more stable financial environment

Opportunities in the mining sector are increasing in Argentina due to changes in legislation and improved relations between the provincial and federal governments. Argentina has 18 projects totalling over US $5 billion in investments likely to move into their construction phase in the next 12 months. Most of these are for hard rock mining for metals, mainly copper and gold as well as for the exploitation of lithium brines.

Argentina has a relatively large and well-established manufacturing capability in this sector so the main opportunities are in:

  • crushers

  • vibrating meshes

  • chemicals

  • construction machinery/vehicles

  • consultancy and support services

UK companies might wish to consider partial local manufacturing to reduce transport and other costs.

Contact the DIT team in Argentina at: https://www.gov.uk/world/organisations/department-for-international-trade-argentina#contact-us for further information and support.

[Source – DIT/gov.uk]

 

Oil and gas sector

Argentina has a well-established hydrocarbons sector with production dating back to the early 1900’s. It is one of the top three countries in the world for reserves of shale oil and gas. It is estimated that 27 billion barrels of shale oil and 800 trillion cubic feet (Tcf) of shale gas are recoverable. State-owned Yacimientos Petroliferos Fiscales (YPF) accounts for 43% of Argentina’s oil & gas production. Most of the international majors are present, including ExxonMobil, Total, Chevron, Petronas, Equinor (Statoil), Shell and BP through their local joint venture, Pan American Energy Group, Argentina’s largest private sector producer. Other London-listed independent E&P companies include President Energy, Phoenix Global Resources and Echo Energy.

Whilst conventional oil & gas production continues to present commercial opportunities, including enhanced oil recovery, environmental services and decommissioning, it is the vast shale deposits that offer greatest potential. Argentina’s basins have been geologically “derisked” through early exploration and production, and the main Vaca Muerta (“dead cow”) play, estimated to have 308 Tcf of shale gas, will require annual investment of around US $10 billion for full development over the next 15 years.

The Argentine Government has also announced a new offshore licencing round, the first in 30 years, with a launch date of July 2018 and bid offers to be submitted by November 2018.

Opportunities exist for equipment and specialist services as the sector develops and investment grows, particularly for cost-reduction and improved efficiency. These include:

  • geoscience and geology

  • fracking (including fluids)

  • drilling

  • offshore technologies and services

  • environmental protection

  • water management

  • health and safety

 

Power generation, renewable energies, and utilities sector

Argentina boasts abundant natural resources. The power of its rivers, the movement of its oceans, the force of its winds and the fertility of its soils are only some of the wonders offered by a wide variety of opportunities in energy generation and access.

In matters of energy, the country stands out:

  • Argentina is ranked second in the list of countries having technically-recoverable shale gas, and fourth in shale oil ranking.

  • With enormous wind power potential due to the winds’ direction, consistency and speed, Argentina is one of the most suitable areas in the world for this type of energy generation (approximately 70% of the territory exceeds the minimum efficiency standard), being the world’s third-largest wind reserve.

  • The Argentine Northwest is one of the world’s four places with the highest potential for solar power generation, which positions the country as the planet’s second-largest solar reserve.

  • The 4,700 km of coastline offer excellent opportunities for offshore wind energy, wave and tidal power.

  • As the world’s third-largest grower of soybeans, Argentina is one of the main producers and exporters of soybean biodiesel.

  • The expanse of the territory and the wide biodiversity it contains provide exceptional natural capacity for alternative energies, such as biogas, biomass and geothermal.

Meanwhile, domestic demand is on the rise:

  • Since the start of the new millennium, natural gas consumption has grown 40%, electric energy usage climbed 60% and fuels 150%.

  • The expected growth of Argentina’s economy for the coming years will sustain the expansion rate of industrial and residential demand.

The ample availability of natural resources, added to the excellent technical skills of human capital and the long-term public policies for the sector, invigorate investment for the generation of sustainable energy.

Argentina was the first country in South America to build a nuclear power plant. At present, there are three plants in operation, generating 5% of the nation’s total energy, whilst there are projects to build two additional plants in the coming years.

Recent developments

To achieve energy security and to mitigate environmental impact, the Argentine State has implemented measures such as:

  • Declaring the National Electricity Sector an ‘emergency’ so as to adapt the quality and security of electricity supply and to guarantee the provision of electricity public services in the adequate technical and economic conditions.

  • Regulating Law N° 27,191, enacted in 2015, which establishes the Regime of National Promotion for the use of Renewable Energy Sources.

65% of Argentina’s energy matrix depends on fossil fuels and it has become a State policy to grant sustainability to the system. The target is to increase the contribution of renewable energy to 20% of the Argentine energy matrix by 2025. The expected increase is of 10,000 MW in ten years, a magnitude that represents a third of the current installed power. 

The fulfilment of only one tenth of the established target would prevent the annual emission of greenhouse gases by an amount equal to the pollution of 900,000 cars. Furthermore, up to 8,000 jobs would be created.

Investment opportunities

The availability of natural resources and the long-term public policies for the sector establish an excellent scenario for the materialisation of investment in Argentina. For example, the Regime of National Promotion for the use of Renewable Energy Sources offers incentives such as:

  • accelerated depreciation in Income Tax

  • anticipated VAT refund

  • exemption of Minimum Presumed Income Tax and of the tax on Dividends for reinvestment in infrastructure

  • deduction of financial expenses in Income Tax

  • Fiscal Certificate equivalent to 20% of the local content integrated (a minimum inclusion of 30% of national components is required)

The open bidding process for the supply of electricity from renewable sources has started: 600 MW from wind energy, 300 MW from solar energy, 65 MW from biomass, 20 MW from hydroelectricity and 15 MW from biogas. The term of contracts is of up to 24 months and up to US $2 billion of investment is estimated. 

Further opportunities are presented for investment in thermal power generation. In recent tenders, the Nation’s Ministry of Energy and Mining awarded a total of 2,871 MW, which has been added to the power grid to February 2018. 

Argentina is a relevant world player due to its vast availability of natural resources and the acknowledged technical quality of its human capital. On this basis, the Argentine State seeks to make the country a leader in the region. 

Energy is the cornerstone of this vision and investment is the fundamental fuel to materialise this accomplishment.

[Source – Argentine Government – Investment and Promotion Agency (Agencia)]

 

Urban security sector

With public security rising up the political, corporate and domestic agendas, the market is expected to grow stronger. Drugs production and trafficking is on the increase, as is organised and common crime.

Given Argentina’s relatively large and well-established manufacturing capability, the main opportunities are in:

  • hi-tech systems

  • sophisticated services (particularly capacity building)

  • niche products that are not available from local manufacturers (particularly in the electronic and IT areas)

There are specific opportunities in:

  • video monitoring, access control, and intruder and fire detection

  • police systems, services and training

  • banking security systems and services

  • electronic tagging of prisoners

The UK Export Control Joint Unit (ECJU) issues licences for the export of strategic goods. You must check that your goods meet the legal requirements for export.

Contact the DIT team in Argentina at: https://www.gov.uk/world/organisations/department-for-international-trade-argentina#contact-us for further information and support.

[Source – DIT/gov.uk]


 

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