workshop on human resource and economic development august 22- sept 04, 2007 taipei (taiwan)

National Investment Promotion Agency

ArgentinaCountry Report

Mr. Juan José CastroMinistry of Economy and Production

[email protected]

Workshop on Human Resource and Economic Development

August 22- Sept 04, 2007

Taipei (Taiwan)

National Investment Promotion Agency 2

Over the past four years Argentina grew at an annual average rate of around 9%, ranking among the fastest growing economies worldwide

8,4

3,9

0,5 0,8

8,8

6,2

4,9

2,1

9

6,3

2,3

1,3

8,7

5,2

3,6

2,4

8,8 9 9,28,5

Argentina Asia endesarrollo

Chile Brazil G7: Economíasmás

desarrolladas

2003 2004 2005 2006

Average: 8.9%Average: 8.7%

Average:5.4%

Average:2.8%

Average:1.7%

Source: ProsperAr based on IMF, WEO databases.

Developing Asia: includes 23 countries such as China, India, Indonesia, Philippines, Vietnam, Bangladesh, Fiji and Pakistan, among others.

Developing Asia

G7: Most developed economies


…and one of the engine was the industrial sector

Monthly Industrial Activity Base 2004 = 100

80

90

100

110

120

I-03 II-03 III-03 IV-03 I-04 II-04 III-04 IV-04 I-05 II-05 III-05 IV-05 I-06 II-06 III-06 IV-06

Fuente: Ministry of Economy and Production

+38.8%


Growth is based on solid macroeconomic foundations that strengthen the country’s economy and rule out the possibility of a crisis in the mid term.

17,9 17,619,3

24,326,5

27,826,5

19,4

10,5

32

28,1

19,6

14,1

-15.000

-10.000

-5.000

0

5.000

10.000

15.000

20.000

25.000

30.000

Balance Fiscal Primario Saldo Cuenta Corriente

Fiscal and Current Account Surplus(in millions of pesos)

International Reserves(in billions of dollars)

Source: Ministry of Economy and Production.

Primary Fiscal Balance Current Account Balance


Argentina’s income per capita measured in terms of purchasing power parity (ppp) is the highest in the region.

GDP per capita in the main Latina American economies Year 2006*, in US$ PPP

6467

78988964

10580

12737

14838

Venezuela Colombia Brasil Uruguay Chile Argentina

* Estimated Source: ProsperAr based on IMF World Economic Outlook.


In addition, Argentina has a solid base of competitive structural factors and capabilities to offer the world a differential value proposition.

Diverse cultural capital and outstanding productions in various fields

Important international figures and works of art

Rich Urban life with a wealth of cultural possibilities

International destination chosen for its quality of life and tourism

Ability to learn, undertake endeavors and innovations

Strong industrial tradition

Modern infrastructure and technological availability

World-class agricultural and industrial commodities

ET with permanent and strategic outlook

Competitive SME center

Qualified Human Resources

High level of education and training

Prestigious Universities

Highly competent Research Centers

Highly competitive health indicators

Abundance of land and natural resources

A wide variety of mineral and energy resources

Diversity of regions, topography and climate

Public and private commitment to preserve nature and sustainable development

Knowledge CultureNature Skills


Natural Resources

Argentina has leveraged on the richness and diversity of its natural resources to develop highly competitive agribusiness activities

Soy ProductivityYear 2005. Argentina = 100

Corn Productivity Year 2005. Argentina = 100

Wheat ProductivityYear 2005. Argentina = 100

75

77

85

100

106

106

106

167

Rusia

Australia

Brasil

Argentina

India

EE.UU

Canada

China

27

41

53

72

79

100

117

126

India

Brazil

Rusia

China

Australia

Argentina

Canada

EE.UU

30

38

62

64

85

99

100

106

India

Rusia

Australia

China

Brazil

Canadá

Argentina

EE.UU

Source: ProsperAr based on FAO


This process occurs within a favorable political/institutional framework for investments.

• Full enforcement of civil and democratic rights.

Argentina is a country where freedom prevails in every area, as confirmed by the Freedom in the World 2007 report.

• Democracy

Within a framework of freedom and full enforcement of the rule of law, our country has moved consistently towards strengthening the democratic system following the institutional crisis in 2000. The new composition and structure of the Supreme Court of Justice of the Nation is a milestone in this sense that reinforces the independence of the Judiciary.

• Respect for Human Rights

There is full respect for human rights. The Courts have reviewed cases related to crimes of lese humanity committed in the past; convicted those involved; and reopened new investigations to avoid impunity.

•Strategically Safe Country

Old-time conflict hypotheses with neighboring countries have been defused following the regional economic integration. There are neither terrorist groups, drug trafficking, gangs or organized crime activities. There are no differences between religious or ethnic groups that could affect the security, or the institutional and economic activity of the country.

• Country of choice among multinational companies

Argentina ranks 18th out of 25 countries of choice among the largest 100 multinational corporations, according to the UNCTAD report.

• Good quality of life

Argentina ranks 10th on the quality of life index prepared by the specialized publication International Living.

• Preferred international tourism destination

Argentina ranks 5th as preferred international tourism destination, according to the FutureBrand report . Buenos Aires was rated the 7th best city to visit (Travel & Leisure 2006).


Industry

A long industrial tradition has enabled us to reach an expansive and diverse manufacturing ecosystem

A significant number of transnational

companies have been present in the

country for decades and progressively

participated in the generation of value

added activities.

A group of prime national companies

strongly internationalized and world-class.

A segment of flexible, innovative and

dynamic SMEs

As an example, the annual production capacity of local industry includes:

• 7 million tons of vegetable oils and over 20

million in by-products,

• Over15 million hectoliters of wine,

• 400 thousand tons of tanned leather,

• 1.2 million tons of paper,

• 200 thousand tons of PVC and over 1.5 million

tons of derivatives such as propylene and

polyethylene.

• 275 thousand tons of raw aluminum,

• 5 million tons of steel and

• 4.15 million tons of seamless and non-

seamless pipes,

• 550 thousand automobiles.


Some Social and Education Statistics...


Argentina Socioeconomic Indicators

Source: UNDP. 2006 Report on Human Development.

Socioeconomic Indicators Argentina Brazil Chile MexicoRegion

Average

Human Development Index (HDI) 0.863 0.792 0.859 0.821 0.795

Life Expectancy at Birth (years) 74.6 70.8 78.1 75.3 71.7

Infant Mortality Rate (0/000) 16 32 8 23 26

Health Care Expenses (PPA in US$ per capita) 1067 597 707 582 …

Undernourished Population <2.5 8 4 5 10

Population with sustainable access to improved water source

96 90 95 97 91

Deliveries performed by specialized staff (%) 99 97 100 95 87

Physicians/1000 inhabitants 301 115 109 198 …

Illiteracy (% over 15 years old) 2.8 11.4 4.3 9 10.8

Gross schooling rate 89 86 81 75 81

Researches in R&D (for every million inhabitants 1990-2003)

720 344 444 268 306


Environment

…within the context of a sustainable environment.

Environmental Sustainability Index elaborated by environmental experts from Yale and Columbia.

Argentina ranks 9th

among 146 countries in

environmental

sustainability

Environmental Sustainability Index Year 2005

75,1

73,4

71,8

71,7

70,8

64,4

63,7

62,9

62,7

62,7

62,2

61,7

61

60,9

Finland

Norway

Uruguay

Sweden

Iceland

Canada

Switzerland

Guyana

Argentina

Austria

Brazil

Gabon

Australia

N. Zeland


Education

Argentina is also characterized by its high educational and cultural level based on the high education standards, similar to developed countries

Source: ProsperAr based on GED 2006, UNESCO.

Adult Literacy Rate (+15 years)%

School Attendance ExpectationsIn years

88,6

89,7

90,4

90,9

91

92,8

93

95,7

97,1

97,2

98,4

Brazil

Am. Lat. y Caribe

Indonesia

China

Mexico

Colombia

Venezuela

Chile

Israel

Argentina

Italy

11,2

11,5

11,5

11,7

12,5

13,1

13,4

14,6

15,6

15,7

16,4

China

Indonesia

Colombia

Venezuela

México

Am. Lat. y Caribe

Chile

Brazil

Israel

Italy

Argentina


55

55

61

62

67

73

75

78

78

81

82

85

Colombia

Indonesia

Venezuela

México

Latin America andCaribbean

Uruguay

Brazil

Hong Kong (China)

Chile

Argentina

Portugal

Australia

19

20

27

28

32

39

43

55

57

60

61

63

China

Brazil

Colombia

Latin America andCaribbean

Hong Kong (China)

Venezuela

Chile

Ireland

Canadá

UK

Argentina

Italy

Argentina has high level of enrolment (secondary a tertiary level)

Secundary School, Net Enrolment Rate (%) (1)

Tertiary Education: Enrolment Rate (%)

Source: ProsperAr based on GED 2006, UNESCO.


Contribution of the argentinian educational system to the economic development….

Scientist and Engineers in R+D(per 1,000,000 of persons)

101

219

225

323

370

533

713

1128

1921

Colombia

Uruguay

México

Brazil

Chile

Costa Rica

Argentina

Italy

Spain

Fuente: ProsperAr based on UNESCO.

Researchers by 1000 persons of the EAP

0,3

0,8

0,8

0,9

1,9

2,2

3,7

4,9

Colombia

México

Latin America and Caribbean

Brazil

Argentina

Chile

Portugal*

Spain*


The challenge...


Argentina faces a unique opportunity given its healthy macroeconomic situation and sustainable growth coupled with a favorable international scenario.

DOMESTIC SITUATION

Four years steady growth at an average rate around 9%

Twin Surpluses: fiscal and external

Growth of exports and imports with

positive trade balance

Competitive and stable exchange rate

“Tight” monetary policy

Record profitability in prime companies

FAVORABLE INTERNATIONAL

SCENARIO

Steady growth of global economy and international trade

Favorable trade terms based on high price of “commodities” and natural resources.

Extraordinary international liquidity

Low global interest rates

Global splitting of value chains

New global consumption patterns (product differentiation)

Substantial accumulation of reserves with reasonable goals

Increasing demand for alternative energy sources

SU

ST

AIN

AB

LE

G

RO

WT

H I

N

AR

GE

NT

INA


For Educational and Scientific National System it means…

• To satisfy the demand growing for especialized technics and enginners in industrial activities.

• Developing of HHRR to reach a competitive country on production of high added valued goods.

• To have a R+D national networking strongly linked to productive sector.


ANNEX


Natural Resources and Agro-industry

…being a leading producer and/or exporter in various agroindustrial segments.

Source: ProsperAr based on FAO.

The Argentine territory has almost 250,000 km2 of farmland.

This large quantity of fertile land together with a competitive industry places Argentina as:

• The N° 1 world producer and exporter of Sunflower Oil.

• The N° 1 world exporter and 3rd leading world producer of Soy Oil.

• The N° 1 world exporter and 3rd leading world producer of Honey.

• The N° 1 world exporter of Horse Meat.

• The N° 1 world exporter of Pears.

• The 2nd leading world exporter of Peanut Oil.

• The 3rd leading world producer of Beef.

• The 3rd leading world producer of Soy Beans.

• The 3rd leading world producer and the N° 1 exporter of Lemons.

• The 5th leading world producer of Wine.

workshop on human resource and economic development august 22- sept 04, 2007 taipei (taiwan)

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