Transcript Unión Industrial Argentina

Argentina:
Global perspective & recent outcomes
1st semester, 2013
INDEX
Development of Argentina’s economy
I.
I.
Argentinean features
II.
Current situation
Argentina's threats and opportunities
II.
I.
Sector and examples
II.
Key sectors
III.
Key clusters
IV.
Specific courses of action of the public sector
UIA action
III.
I.
Main objectives
II.
UIA role
Argentina
Strategical partner in a region with promising prospects
ARGENTINEAN
FEATURES:
•GDP: 746.9 billion
(2012 est)
•GDPpc: 18,200
(2012 est)
•Rise of middle class
income
•High life expectancy
(+77)
•Populat.: 42 million
•Area: 2.8 sq km
Source: CEU-UIA based on the CIA
ARGENTINEAN
STRENGHTS:
• Internal market
• Natural resources
•Manufacturing
•Trained human
resources
•R & D
Strong regional linkages
There are increasing business opportunities with Brazil, Argentina's main trading partner, to
complement each other and to specialize in specific manufactured goods
MERCOSUR: Common market
•As MERCOSUR member, Argentina has
tariff free market access of more than
240 million consumers and a combined
GDP of US$ 2,9 trillion (PPP 2010)
•Remarkable industrial
complementarities with Brazil and
further opportunities for specialization
Members: Argentina, Brazil,
Uruguay, Paraguay
Associates: Bolivia, Chile, Colombia,
Ecuador, Peru, Venezuela
Source: SUINV based on IMF and World Bank
Sustainable growth
Argentina has had a sustained growth during the 2000. The IMF figures confirm this trend
Argentina’s GDP 2003-2010
(In thousands of millions of AR$ at constant prices)
∆ 2012/2002: + 99.15%
∆ 2012/1998: + 62.5%
Source: SUINV based on Ministry of Economy and Public Finance and IMF
Argentina: sustainable growth
The country has been showing a strong economic performance. The IMF figures for 2011
confirm this trend
Selected economies: GDP growth rates (2003-2011)
10,7%
10,3%
9,5%
10,1%
8,1%
World GDP Growth
9,2%
8,0%
7,8%
7,4%
4.0% (2011P)
7,5%
6,5%
5,4%
5,2%
3,8%
3,8%
3,8%
3,5%
3,0%
1,8%
China
India
Argentina
Chile
Prom. (2003-2009)
Source: SUINV based on IMF
Brasil
2010
2011 (p)
México
1,6%
1,5%
Estados Unidos
1,8% 1,6%
0,9%
UE
With a key role of the domestic market
And its effect on employment generation and unemployment contraction
25
Unemployment rate
•The unemployment rate
decreased up to 6.7% (from
22%) in 9 years
21,5
20
18,3
18,4
17,8
17,1
17,316,1
16,6
14,5
15
15,4
13,7
12,4
13,2
14,7
13,8
16,4
15,6
17,8
14,5
12,1
10,7 12,2
10
9,9
9,3
•More than 4.000 millon
formal jobs were created
14,8
10,4
10,1
8,7
8,5
7,5
7,3 8,8
8,0
7,9
8,4
7,3
7,3
6,7
7,2 6,9
5
may
oct
may
oct
may
oct
may
oct
may
oct
may
oct
may
oct
may
oct
may
oct
may
oct
may/ii
iv
ii
iv
ii
iv
ii
iv
ii
iv
ii
iv
ii
iv
ii
iv
ii
iv
ii
iv*
0
1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Source: CEU - UIA based on INDEC.
•As a result of this poverty
shoot down
•And domestic market was
strengthened
Global openness (X+M /GDP)
It has been increasing during the 2000, even after the international crisis
Openness coefficient
(as GDP percentage)
50%
44% 44% 44%
45%
45%
45%
43%
42%
40%
41%
40%
41%
37%
35%
30%
25%
21%
23% 23%
20%
20%
16%
21%
22% 22%
18%
15%
10%
5%
0%
1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Source: CEU - UIA based on MECON.
INDEX
Development of Argentina’s economy
I.
I.
Argentinean features
II.
Current situation
Argentina's threats and opportunities
II.
I.
Sector and examples
II.
Key sectors
III.
Key clusters
IV.
Specific courses of action of the public sector
UIA action
III.
I.
Main objectives
II.
UIA role
Diversified economy to meet global market needs
Argentina presents profitable investment opportunities in a variety of strategic sectors for
the world economy
Agro
Industry
Value added
and design
manufactures
Professional
services,
software and IT
Pharmaceutical
Industry
Agricultural
machinery
Renewable
Energies
Biotechnology
Autoparts
Creative
Industries
Tourism
Agro Industry
Leading global producer & exporter of food commodities and products
Argentine Share in Global Exports and Global Position
(export % and position)
Natural honey
From
Rio
Negro
From
Tucumán
19.5
Pears
17.8
Lemon juice, concentrated
72.3
Soybean oil
51.7
Grape juice
21.8
Sunflower oil
18.0
Lemons and limes
14.7
Soybeans
15.9
Safflower oil
18.0
Powdered whole milk
4.9
Wheat
Sunflower seeds
5th
7.3
1.9
Source: ProsperAr based on FAO data
6th
13th
From Bs. As.
Córdoba y Santa
Fe
Food and Beverages
Leading producer and exporter of commodities and value added foods
Resources
and leadership
Industrial and innovation
capacity
Argentina’s share in global exports and global
position
Rising manufactured exports of agricultural
origin
(2008)
(in billions of US$)
Lemon juice concentrate
Soybean oil
Safflower oil
64.7% 1st
44.9% 1st
27.7%
Sunflower oil
24.0%
Grape juice
22.9%
Pears
Lemons and limes
Honey
Soy seeds
19.4%
17.8%
3rd
12
13
15
10
2003
2004
2005
2006
19
24
21
23
2008
2009
2010
2nd
2nd
2007
2nd
2nd
17.3% 1st
14.9% 3rd
Source: SUINV based on FAO and INDEC
Wine industry
Diversity of investment opportunities
Outstanding opportunities:
 Sophisticated varietals (high consistence and
quality)
 Supplies for production (agricultural
machinery, traceability techniques, glass
bottles, corks and capsules)
 Grape juice concentrate
 Wine tourism
 Great ability to adapt to the demand
requirements in developed countries
 Emergence of new markets with increasing
purchasing power (China, Brazil)
 Increasingly sophisticated tastes of
domestic demand
Source: SUINV based on Fondo Estratégico de la Vitivinicultura Argentina.
Differentiated Manufactured Goods
Key segments showcasing Argentina's industrial capacity
Manufactures of sailboats, cruisers and smalls vessels
High quality and international recognition.
Over 25 years exporting to developed countries mainly the European and
Asian markets.
Integrated value chain: 120 builders of sailboats, cruisers, vessels, inflatable
boats, equipment and all necessary services for the production and
maintenance of a wide range of boats.
Installed capacity of 700,000 m2 and occupying 700,000 people.
Nuclear, Spatial and Industrial Engineering: Argentine firms working with
excellence
INVAP: technology-based company dedicated to developing advanced
technology in nuclear, aerospace, medical and industrial sectors.
In 2000 won an international tender, beating specialized companies from
countries like Canada, Germany and France for a 20 MW reactor power, which was
sold for approximately US$200 million.
The reactor is used for scientific research in the fields of health, environment
and industry and the production of radioisotopes for medicinal purposes, catering
to Australia, New Zealand and Southeast Asian market.
 IMPSA: global company dedicated to producing solutions for power generation
from renewable resources.
Pharmaceutical industry
Growing trend in sales and exports
Argentinean Pharmaceutical Exports (in U.S. $ million)
Production concentrated in medicine
Consolidated industry
1000
•250 laboratories
800
•110 manufacturing plants
600
•13.000 pharmacies across the country
400
2003-2010: + 152%
200
0
Total Sales (In U.S. $ million) - lab prices
2003 2004 2005 2006 2007 2008 2009 2010
Medicinas
+ 125%
3.220 3.349
1.791 1.791
2.264
national laboratories on the local total in the
rest of Latin America (56%)
2003
2004
2005
2006
Total
Increased percentage of participation of
2661
2.019
Ingredientes activos
4.024
2007
2008
2009
2010
Fuente: SUINV en base a CILFA e INDEC.
Agro Industrial Machinery and Precision Instruments
Industry known for its differentiated production and high-skill labor force
(mainly engineers and technicians)
Major cluster with more than 100 years of expertise, 40,000 employees (80%
skilled labor) and 665 factories.
Know-how to produce innovative equipment for new agronomic practices like
“Direct Sowing”.
Machinery with high technological capabilities, innovative solutions and power
to adapt to extreme conditions
Growing production of high-tech precision instruments
Metallurgical industry – Other Highlights
Agricultural machinery and boats, innovative industries expanding
Agricultural machinery :
Boats:
► Over 100 years
►Integrated value chain: 120
of experience
construction companies
► 655
production plants
►+ Than
13,000 skilled jobs
►Installed
capacity over
700,000 m2
►Development
of innovative
equipment adapted to modern
practices (direct sowing,
precision agriculture)
►7,000
►Opening
►International
to the world:
Exports
Opening plants abroad
Fuente: SUINV en base a INDEC
direct and indirect jobs
(most of them skilled, trained
and / or professional)
integration:
exports to developed countries
for over 25 years
Biotechnology
Scientific tradition and innovation in biotechnology
Regional leadership
120 firms, including leading domestic
companies and successful multinational
companies
 More than 3,000 employees
 Annual exports: over US$ 260 millions
3rd largest global producer of
biotechnological crops (GMOs)
Long tradition in biomedicine
The largest biotechnological Pole in Latin
America is in Rosario (Santa Fe)
Multi-species cloning
Competitive advantages already set
in various segments: agricultural, food
as well as human and animal health.
Renewable Energies
Outstanding performance and opportunities for growth
Public support
Biodiesel production 2010
(In millions of liters)
9,920
European Union
2,405
Brazil
rd
2,178 3
Argentina
United States
953
Malaysia
886
Australia
640
Canada
315
India 258
Source: SUINV based on OCDE-FAO Agricultural Outlook
Biofuel Law (2006) and Bioethanol Law
(2008)
Mandatory blends: E5 (5% of ethanol) and
B7 (7% of biodiesel)
The Secretary of Energy sets biofuel prices
aligned with international prices
The National Promotion Act for use of
renewable energy sources (Law 26,190)
stipulates that 8% of electricity must be
generated from diverse renewable sources by
2016 (GENREN Programme)
Forest Industry
Natural conditions and availability of genetics
Temperate climates and good availability of water
1.2 million hectares of mature planted forests
Potential to increase the cultivated area and to process natural resources
Industrial Plan 2020: expects the forest industry production to grow 140% (compared to 2010) and
to generate an annual trade surplus of over US$ 542 million by 2020 year
Top Argentina’s forestry exports
Total Exports: US$ 514 millions (2009)
Others; 8%
Sawnwood;
7%
Paperboard
and other
paper
products;
23%
Wood
Charcoal;
10%
Medium
Density
Fibreboard
(MDF); 11%
Printing and
writing
Paper; 15%
Law 25,080 of Investments in Forestry:
Tax benefits (tax exemptions,
tax stability for 30 years, early refund of VAT,
accelerated depreciation in Income Tax,
among others)
Non-refundable contribution for new
investments
Source: SUINV based on OCDE-FAO Agricultural Outlook
IT and Software
A highly dynamic sector with an export-oriented profile
 Third largest exporter of software
in Latin America
Growth in software exports, sales and employment
(In millions of US$ and thousand of jobs)
 1,600 software companies
Domestic sales
 65% of software companies export
regularly to diversified destination
markets
3,500
 Domestic sales growth: +15%
annual (2005-2011e)
2,500
 Exports growth: +20% annual
(2005-2011e)
 More than 69,200 employees
estimated for 2011; most of them
with tertiary or university degrees.
1,500
52.9
40.0
32.9
2,440
60
2,582
50
1,871
40
1,617
30
1,307
247
300
387
504
547
663
747
20
10
0
0
2005
Source: SUINV based on Cessi
2,276
45.7
55.9
70
3,102
60.1
1,000
500
Jobs
69.2
3,000
2,000
Exports
2006
2007
2008
2009
2010
2011e
…and other important industrial sectors in Argentina
Iron and steel
sector &
metallurgical
industry
Textile - Clothing
Soybean & oil
industry
Poultry and bovine
meat
Plastics, chemicals
and petrochemicals
Public sector supportive of investors
Welcoming investors: protection and equal rights for foreign investors

The Argentine Constitution guarantees equal treatment and rights for local and foreign investors

The Foreign Investments Act (No. 21,382) defines the legal framework for foreign investments
Foreign investors may:
 Remit abroad liquid profits arising as a return on their investment as well as repatriate their investment
 Avail themselves of any of the legal forms of incorporation foreseen by Argentine legislation
 Make use of domestic credits and loans with the same rights and under the same conditions as domestic
companies of domestic capital
 Access all sectors of economic activity as there are no activities reserved exclusively for local enterprises
Source: SUINV
Public sector incentives
Horizontal incentives
Sector incentives
✓Investment Promotion Law (No. 26,360): early VAT
Specific benefits and incentives for diverse
return and/or accelerated depreciation allowances for
sectors: automotive and auto parts, software,
investment on capital goods and infrastructure
biofuels, biotechnology, mining, forestry, public
✓0% tariff on imports of capital goods
infrastructure and hydrocarbons
✓0% tariff on imports of goods which are part of a large
investment project
Exemptions from provincial taxes for a determined
period of time
✓For every new job created, 50% reduction on employers’
•Gross income
contributions during the first year of employment and a
•Stamp taxes
25% reduction in the second year
✓Others: FONTAR, FONSOFT, SEPyME programs, incentives
to foster employment and exports (for further details
please see “Investment Incentives” published by SUINV)
•Property tax
Financial support for infrastructure investments and
purchase of relevant equipment
Source: SUINV
INDEX
Development of Argentina’s economy
I.
I.
Argentinean features
II.
Current situation
Argentina's threats and opportunities
II.
I.
Sector and examples
II.
Key sectors
III.
Key clusters
IV.
Specific courses of action of the public sector
UIA action
III.
I.
Main objectives
II.
UIA role
For more than 120 years, the Argentinean Industrial Association has been
representing the industry interests
• UIA was founded on February 7th 1887
• Currently, it has 171 members. All of them associations of the different
industrial sectors.
– Manufacturing Sector Associations, representing local and foreign companies
including automotive sector: Ford Motors Company, General Motors, Peugeot
Citroen, Renault, FIAT, Toyota. Food companies such as Cargill, Kraft Foods, Coca
Cola, Cadbury Stani, Danone, Seaborg, Quick Food, Unilever. Laboratories:
Abbott, Lilly, Merck, Bayer, Astra Zeneca, 3M. Steel companies: Arcelor Mital.
Additionally, are members companies like Telefónica and Telecom, Pan American
Energy, Petrobras, John Deere, Accenture…
– Local Associations (Provincial Industrial Unions)
• And it is governed by:
– Executive Committee
– Board of directors
– Professional staff and different sections covering technical areas
The main goals
MAIN
OBJECTIVES
To represent industry interest actively
To propose and elaborate proposals to foster
economy and industry competitiveness
To give support to its members
UIA Structure: Technical areas
Technical areas
• Fields where all members can take part and discuss key
issues that concern industry competitiveness
• Run by members representatives with strong technical skills
SME´s
Infrastructure
Education, Science
and Technology
Regional
Development
Social Policies
Members
CEU
Centre of Economic
Studies
Technical
analysis related
to
macroeconomics,
manufacturing
sectors and
international
trade issues
Trade and International
Negotiation
Taxation
Environment
Legislation
Support to
members through
the Departaments
Services and activities for all associates
• Reports about industrial sector and trade performance
• Seminars and journeys on economic and industrial performance
• Special reports on fiscal and financial affaires concerning the industrial
sector
• Support and assistance to members concerning different areas (trade,
human resources, etc)
• Euro centre UIA – jointly with Argentinean Chamber of Commerce and the
economic support of European Union Council (AL-Invest Programme for
Latin America)
• Annual Industrial Conference
29
Asignaturas pendientes del MERCOSUR
In terms of SME policies, the UIA is working in the creation and
implementation of programs for industrial development
I.
Enlargement of industrial base
II.
Innovation
III. Competitiveness improvements
IV. Sustainable production (environment problems)
V.
Major international insertion
UNION INDUSTRIAL ARGENTINA - Av. de Mayo 1147/57 C.P. (C1085ABB) Buenos Aires, Argentina Tel. (54 11) 4124-2300 (Líneas Rotativas) Fax (54 11) 4124-2301. E-mail: [email protected]
Asignaturas pendientes del MERCOSUR
Some examples
33 Value Chains y 6 Federal
forums of the Industry
15 Territorial pacts y
21 Regional SMEs observatories
150 Associative and Technical
Assistance Projects (1000 SMEs
involved )
Studies on economy and
Industrial Policy
Internationalization of SMEs
Promotion of Innovation and Industrial Design
Link between University and
Company
Promotion of Entrepreneurs and
Young Entrepreneurs
UNION INDUSTRIAL ARGENTINA - Av. de Mayo 1147/57 C.P. (C1085ABB) Buenos Aires, Argentina Tel. (54 11) 4124-2300 (Líneas Rotativas) Fax (54 11) 4124-2301. E-mail: [email protected]