OPPORTUNITIES

Argentina ranks high to many businesspeople looking for new international opportunities. It is the wealthiest nation in all of LatinAmerica on a per capita basis. The economic stability built on the policiesof the administration of President Carlos Menem, the liberalization oftrade laws, the reduction of tariffs, the dramatically reduced inflationrate, and the country's growing economy are all features attractive tothe international trader.

As an exporter, Argentina is looking forward to diversify production and increase exports, especially nontraditional,higher-values-edded exports, as it revitalizes its economy. As an importer,it demands a wide range of goods to meet business expansion and upgradesin diverse sectors as well as the wants and needs of its consumers, particularlythose of its battered but recovering middle class, still the largest inLatin America. Practically all areas of the economy could benefit fromforeign investment.

THE RECENT DEVELOPMENTS

1-Privatization: It would be verydifficult to overestimate the enormity of the privatization process inArgentina over the past 7-8 years. The policy represents and absolute about face from decades of state owned public enterprise operation. Argentina's foray into privatization has been fast and complete, and has played a critical role in the government's economic stabilization plans. Most public enterprises have been sold, and public procurement projects continue to be available as the country modernizes, rebuilds its social and transportation infrastructure,water, and sewerage systems, and cooperates with formerly state-owned corporationsin the fields of electricity, oil and gas, and telecommunications.

2-Foreign Trade Zones: Argentinahas an established foreign trade zone in La Plata (Buenos Aires province) and also has a special regime for certain products in its southernmostprovince, Tierra del Fuego. It allows the duty-free import of foreign goods destined for specified high priority industries and it also gives other tax breaks to users of the zones. Plans were approved during 1996 and 1997for the creation of foreign trade zones in most of the country's 23 provinces as well as in four other areas of the country. Although of limited importat present, such zones could play a significant role in international operations in the future.

3-Mercosur: (Mercado Comúndel Sur or Common Market of the South): On January 1, 1995 Argentina, Brazil,Paraguay, and Uruguay united to form Mercosur, a customs union bringing together 200 million people with a combined annual gross domestic product (GDP) of more than US$ 900 billion. The agreement offers reduced tariffs and other benefits to the countries and sets a higher common external tariff (CET), channeling more trade among the members. Both Chile and Bolivia negotiated free trade agreements with Mercosur.
Argentina

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