Debt relief agreements, lithium mining and production, auto manufacturing, energy industry, tech access all part of comprehensive and aggressive plan to bolster Argentina’s economy
WASHINGTON, Sept. 14, 2022 /PRNewswire/ — Argentina’s Minister of the Economy, Sergio Massa, announced that following a week of meetings with U.S. officials and executives, he has made significant strides toward bolstering his country’s economy, currently undergoing historically high inflation and other pressures. The minister’s statement came at the conclusion of a week-long delegation, his first state tour since taking office. He was joined by Ministers of Mining, Fernanda Ávila, and Energy, Flavia Royon.
Throughout the week, Minister Massa secured investments from a number of leading U.S. corporations and global financial institutions. The investments will go toward supporting key economic development initiatives, helping drive efforts to foster long-term economic development in Argentina. Announcements included:
IMF: Leadership from the IMF welcomed Massa’s strong commitment to achieving the goals established by its extended agreement with the country, including lowering fiscal deficits, accumulating reserves, and having a strong macroeconomic framework.
Inter-American Development Bank: New financing plan totaling nearly $5 billion through the end of 2023 will enable Argentina to launch key programs in infrastructure, health, water, and tourism
Lithium Mining and Production: Rio Tinto – $190 million investment toward annual production of 3,000 tons of battery-grade lithium carbonate; LIVENT – $1.5 billion to expand lithium production
Energy Sector: Companies including BP, Chevron, Exxon, and Total Energy engage in further support of Argentina’s role in the energy sector, including exploration and production at Vaca Muerta as well as additional sites
Amazon: $35 million to create new local zones that will stimulate technology access and generate jobs within the knowledge sector
Volkswagen: $250 million expansion of the country’s Amarok pick-up production line and Ducati motorcycle assembly facility
Minister Massa reflected on the trip, stating, “Increasing our exports of proteins and minerals such as lithium, copper, and gold, as well as playing a greater role in the energy market, are central goals for Argentina, because they help us contribute to the global food security and energy security agenda. Fiscal order, accumulation of reserves, and the growth of Argentine exports are the three main objectives that we set for ourselves for the coming months.”
Massa also met with U.S. Treasury Secretary Janet Yellen, discussing policies relevant to U.S.- Argentine relations, including food and energy security, foreign tax policies, and the global economic context of the Ukraine War.
Following the Minister’s U.S. trip, a number of positive indicators were reported. The week closed with an increase in international reserves, new access to international financing, and positive reporting from the Central Bank of Argentina. Argentine stocks closed higher and the MEP dollar closed at $269.56, the lowest since Massa took office and in comparison to $360 before he took office. Since Massa’s appointment, Parallel Dollars have accumulated a drop of $55 on average. And with the official exchange rate rising at a rate of 7% per month, the gaps between the Official and the Parallel have been reduced sharply, from 140% to 80% ranges.
Argentine stocks and bonds on Wall Street also continue to show an marked upward trend, led by state energy company YPF with a 100% increase in American Depository Receipts (ADR) in the last 45 days and other energy companies and banks demonstrating a 40% ADR increase on average in the same period. Additionally, Argentine bonds have stabilized at values 20% higher than last July.
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SOURCE Instituto Nacional de Promocion Turistica
