For the first time in two decades, the US Chamber of Commerce is bringing business leaders to Argentina. Global hedge funds are snapping up the country’s assets. Farmers across the fertile pampas are getting ready to empty silo bags of corn and soybeans after years of withholding part of their crop in anger over tax policies.
Nine days before a closely-watched presidential election in Argentina, it would be hard to overstate the level of expectation in the business world. BRF, Brazil’s largest food company, is expanding two factories and planning acquisitions. BayWa, the Munich-based grain trader, is building its first office in South America’s second-largest economy. Arca Continental SAB, Latin America’s No.2 Coca-Cola bottler, talks of “tremendous opportunity.”
"There are many, many opportunities in that country,” Chief Executive Officer Francisco Garza Egloff of Arca Continental said on a conference call with investors 23 October. “Well-located, well-positioned in terms of energy, commodity and so on, no debt. It’s a tremendous opportunity to work with a well-educated and prepared population.”
The turnaround in attitude is stark. For years, doing business in Argentina has been enormously frustrating, with 30 per cent inflation, currency controls that make it costly to get money out of the country, sub-par economic growth and unpredictable government policies.
The reward has never seemed closer for foreign companies that stuck it out, betting a country that’s home to an educated workforce, the world’s second-largest shale gas reserves and the third-largest source of soybean exports would eventually normalise. On 22 November, Argentines will choose between two presidential candidates who have promised change from the past dozen years of leftist populism led by the Kirchner family.
“We’re getting the right overtures right now that this election may represent a renewed relationship with the U.S. and the U.S. business community,” said Jodi Hanson Bond, the vice president for the Americas at the U.S. Chamber of Commerce.
The optimistic notes from foreign companies follow moves by hedge funds and other investors who say the departure of President Cristina Fernandez de Kirchner will bring a windfall.
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