Argentina: A New Paradigm for Investment, or Same Old Story? 

Argentina has been touted as the country of the future before, but promises of reform seem to always run aground on the hard realities of domestic politics. 

But things are materially different — for real this time — a group of investors and experts said at a Metro Atlanta Chamber seminar on investment in the country. 

“In Argentina we have a new paradigm that really is changing the future,” said tax expert Mariano Payaslian, during virtual comments at a the event, organized by the Consulate General of Argentina.

A country long saddled with high inflation, foreign exchange controls and out-of-control public finances has tacked each of these issues under Javier Milei, the libertarian president elected in 2023 after pledging to take a chainsaw, his preferred campaign prop, to government spending. 

Argentina is making concrete moves toward tackling its fiscal issues, which should create space or solving the runaway inflation that has traditionally led to instability and stymied foreign investment. 

“In the past that was an open discussion; now there is consensus that this cannot continue,” Mr. Payaslian said of the deficit. 

Mr. Milei has made good on the cuts, leading to the pain he promised would be necessary to free Argentina from its cycle of debt, bailouts and poverty. He has been criticized by teachers’ unions, citizens and other segments of the population, and a defeat in elections this week in Buenos Aires province call into question how enduring his plans will prove. October’s mid-term parliamentary elections, held nearly two years into his term, present a key litmus test. 

Still, a year and a half under Mr. Milei has brought some key reforms that are renewing investor confidence, said Fernando Acevedo, an attorney with Cassagne Abogados. 

Amid a broader deregulation push, he removed capital and currency controls that restricted access to dollars to pay dividends to foreign shareholders of local companies. The president also installed a special tax regime for foreign investments of more than $200 million in key industries like energy, gas, mining, tourism or technology. The Incentives Regime for Large Investments,or RIGI by its Spanish acronym, caps the corporate income tax at 25 percent and offers some hedges against inflation. Crucially, it also allows for arbitration to settle disputes with the state, an important provision in a country with a history of expropriation. A similar regime is being debated in the legislature for small- and medium-sized investors. 

“There has been $3 billion approved, and there are $20 billion in projects that were fine and that are waiting for the approval, so this is moving forward,” Mr. Acevedo said. 

When Daniela Demaria came to Atlanta in the early 2000s, the only investments being discussed were speculation around junk bonds and agricultural plays. But now? 

“Argentina was able to really rebrand itself over the last 20 years,” said Ms. Demaria, a corporate strategist and former banking executive representing the Argentine-American Chamber of Commerce Southeast on the panel. “It has shown a resiliency that’s unique. What I’ve seen is that shift of Argentina from a natural resources, commodity and food-type of country to becoming recognized as a source for talent, in particularly in technology and innovation.” 

Argentine software companies have proven solid partners for tech firms in the U.S., with delegations frequently visiting the burgeoning tech hub of Atlanta, and now many are innovating to create their own startups, buoyed by new regulations but not waiting for certainty to make moves. 

That ability to operate in an uncertain environment is what sets Argentine talent apart, said Mauro Mambretti, a tech investor and fintech innovator with Emunah Fintech. That — and a commitment to excellence. 

“They love the challenge. It’s not about money. It’s about doing the right thing,” said Mr. Mambretti, also speaking remotely, who has seen Argentines use their ingenuity and on-the-ground knowledge to offer better localized solutions at a fraction of the cost of big international consulting firms. “When you’re in the real estate business, the three variables that set the price are location, location, location. I personally believe that it’s about people, people, people.” 

For Argentine people, the question is whether the short-term pain of the Milei reforms leads to longer-term prosperity. 

Consul General Alana Lomonaco Busto says more voters seem willing to make that tradeoff after years of unmet potential in the Argentine economy. 

“What we see this time as different from previous occasions is that people chose this path even knowing that it would be hard,” the consul general said. “There seems to be a consensus that the path to growth has to be led by the private sector and by business. The idea is to have a smaller state, a more efficient state, and have more space for private initiative.” 

The event was organized, intentionally, with the spotlight in Georgia shining on Argentina as Gov. Brian Kemp was set to visit the country later that week. Mr. Kemp met with existing investors like Bersa, a firearms manufacturer, which along with medical device company Tecme is one of the few Argentine firms that have set up shop in the state.