Doing Business in Argentina – Elected President Implements Market-Friendly Policies
If you are thinking about doing business in Argentina, the newly instated macroeconomic policies make it even more attractive.
We mentioned in our Emerging Markets Outlook 2016 post that Argentina is going to be one of the rising stars with a much needed come back to the international capital markets. After years of increasing state intervention the newly elected Argentine President, Mauricio Macri has announced the introduction of bold liberal economic policies to revitalize the country’s economy. Argentina was once the third strongest economy in Latin America and is now on the path to overcoming economic stagnation, inflation of more than 25 percent, and mistrust of the international banking after the “vulture funds” scandal in 2014.
The Washington Post reported that one month after his election, Mauricio Macri lifted strong currency exchange controls imposed by the Kirchner government since 2011. Macri also reduced taxes on agricultural exports and renewed negotiations with holdout creditors. All these measures may seem risky but they have contributed to the stabilization of the currency, with just a small depreciation of the peso, and led to the revived interest of international markets in the Argentine economy.
2016 will certainly be a year of adjustment for Argentina, but all these policies will most likely contribute to the rise of its economy. There are even hopes by some that this will lead to Argentina surpassing the former leading exporter of the Emerging Markets in Latin America – Brazil. As the country opens to international markets we feel now is the right moment to start exploring the different opportunities in Agriculture, Mining, Food Industry, Oil, Medical Equipment Tourism, and Energy that the country has to offer.
The Argentine economy will definitely see improvement in the short-run and our advice is to closely follow President Macri’s new economic policies to gauge the long-term implications.
Take a look at our Global Strategies for Businesses that Succeed post and start planning your next move to South America.