Business in Argentina Buenos Aires. Economy foreign trade exports imports

Course summary Doing business in Argentina

Doing business in Argentina: Gas and oil, main exporters of cereals, 5º producer of wine, industrial sector, foreign direct investment FDI

Argentinean economy. Argentina is member of the MERCOSUR (*), the main advantage resides in having access to an extended market with 234 million people and the possibility of exporting to and importing from member countries without having to pay duties. Since the creation of MERCOSUR until 2006, trade between Argentina and the other member countries went up by more than 500%.

(*) Members of Mercosur: Argentina, Brazil, Paraguay and Uruguay. Associate members: Bolivia, Chile, Colombia, Ecuador and Peru. Observers: Mexico.

Argentina has been one of the fastest growing economies in the world and its 6.8% increase in GDP in 2008 confirms the sustained growth trend. The compound annual growth rate for 2003-2008 was 8.5%, below China (10.7%) and India (8.4%). During this period, Argentina’s growth was well above all other Latin American economies. During 2008, the service export sector registered a record-high volume of US$12 billion, one of the highest levels in Latin America.

Argentina offers investors attractive profitability in a wide range of sectors. Earnings as a percentage of Foreign Direct Investment (FDI) stock were 10.2% average in 2006-2008, the highest in past 15 years. Earnings as a percentage of revenues for the 340 largest non-financial companies are also at record levels, averaging 15.4% per year over the period of 2005-2007.

More than 1,000 overseas-based corporations operate in Argentina, including half of Fortune 100 firms, many of which have been in the local market for over half a century. In 2009, in response to the global financial and economic crisis, investment decreased worldwide and our country has not been an exception. After achieving the highest investment rates in 30 years in 2008 (23.1%), investment fell during the first nine months of 2009.

The automotive industry is a key contributor to manufacturing production and exports in Argentina. In 2007, it represented 2.5% of GDP (including automotive parts manufacturing), 8.5% of industrial production and 10% of exports. The automotive industry remains one of the principal engines of industrial growth and technology transfer. There are ten manufacturers present in Argentina –Fiat, Ford, General Motors, Iveco, Mercedes Benz, PSA Peugeot-Citroën, Renault, Scania, Toyota and Volkswagen– producing a total of 18 different models.

Argentina counts with a large and highly competitive food and beverage industry, with total sales of US$53 billion (31% of total manufacturing production sales) and exports of US$21 billion (30% of total manufacturing production exports).

The software and computer services industry in Argentina has approximately 40.000 qualified workers spread among 1000 companies that invoice around USD 1600 Millions and USD 300 Millions due to exports. By the end of 2011 the industry is expected to employ nearly 70.000 workers and to raise its invoice to USD 3000 Millions and more than USD 600 Millions for exports.

Creative industries are largely concentrated in the city of Buenos Aires, where they represent 7.5% of the district’s GDP and 8% of total employment. Other big cities, such as Cordoba, Mendoza and Rosario, are also developing an increasingly large creative industries sector.

Buenos Aires is one of the main markets in Latin America and in the world. Including its metropolitan area (Greater Buenos Aires), Buenos Aires has over 13 million inhabitants and this positions it among the 9 most populated urban conglomerates in the world. Buenos Aires is the 13th urban center with the largest income in dollars in the world, ahead of cities like Hong Kong, Miami or Sao Paulo, and its growth prospects are excellent. Its GDP (Gross Geographic Product) almost triples the average income per capita in Argentina, and this fact places it in the first place in Latin America. In 2006, production in audiovisual industries amounted to $ 3.14 billion, i.e. 2% of the gross geographic product of the City. This production is close to that of construction (4.9% of GGP) − the most traditional and dynamic industrial activity in Buenos Aires.

The Arcor Group’s early international vocation led it to become the first world producer of candy and the main exporter of sugar confectionery products in Argentina, Brazil, Chile and Peru. Through Bagley Latinoamérica S.A., it is South America’s largest cookies and crackers production company.

International Economic Relations. Argentina is member of: Southern Common Market (MERCOSUR), Latin American Integration Association (ALADI), Union of South American Nations (UNASUR), Latin American and Caribbean economic System (SELA), Economic Commission for Latin America (ECLAC), Andean Community (CAN) (CAN9 associate member), Inter-American Development Bank (IDB), Forum for East Asia-Latin America Cooperation (FEALAC), Summit of South American Arab Countries (ASPA), Organization of American States (OEA), World Bank, International Monetary Fund, World Trade Organization, United Nations, OAS, IAEA, G-20, G-77, IFC, UNCTAD, UNIDO, OEI, ...

Argentina has bilateral Free Trade Agreements FTA with: European Union, India, CAN9 associate member, Gulf Cooperation Council (GCC)

Borders of Argentina: Bolivia, Paraguay, Brazil, Chile and Uruguay

Business, Argentina, Buenos Aires, Economy, foreign, Trade, Exports, Imports, natural, resources, Gas, Oil, exporters, cereals, producer, wine, industrial, sector, foreign, Direct, Investment, FDI, Master, international business