Argentina focuses on investment to jump-start weak economy

AP News
Posted: Sep 13, 2016 5:05 PM
Argentina focuses on investment to jump-start weak economy

BUENOS AIRES, Argentina (AP) — President Mauricio Macri urged the CEOs of Coca-Cola, Siemens and nearly 2,000 other foreign and local companies Tuesday to invest in Argentina and help revive its struggling economy.

Macri took office in December promising to attract foreign investment, cut government spending and end economic distortions blamed for years of spiraling consumer prices in South America's second-largest economy.

On Tuesday, he spoke to businesspeople from more than 60 countries attending a three-day investment forum.

"I'd like to thank all of you, especially those visiting our country from abroad; you're in the right place, at the perfect moment," Macri said. "We're starting to see strong signs that the recession is on its way out and the world is once again looking at and talking about Argentina."

Since succeeding left-leaning President Cristina Fernandez, the conservative Macri has struck a deal with U.S. creditors to return Argentina to global bond markets for the first time in 15 years. He also has rolled back restrictions on buying U.S. dollars and reduced taxes on exports and other protectionist measures instituted during 12 years of governments led by Fernandez and her late husband and predecessor as president, Nestor Kirchner.

Macri's critics say his cuts to utility subsidies and the firing of thousands of state workers have stoked unrest amid a recession as Argentines continue to see their purchasing power erode from one of the world's highest inflation rates.

Macri says the measures are needed to jumpstart the weak economy and promises that the galloping inflation rate, estimated at more than 40 percent a year, will gradually begin to slow. He has also vowed investments of more than $100 billion in the coming months.

During their years in office, Fernandez and Kirchner gained popularity by spending heavily on programs for the poor and restoring Argentina's sense of pride and sovereignty after the country's worst economic crisis in 2001. But the couple was also criticized for failing to curb inflation and the government's growing deficit while they continued to raise tariffs and impose protectionist policies that discouraged foreign investment.

"What has changed? The fact that those abroad are starting to notice that Argentina is changing for real and wants to get involved," said Cristiano Rattazzi, the president of Fiat Argentina, told The Associated Press at the forum.

"Up until recently it was nearly impossible to export. But today, Argentina wants to be a key player in the world."


Associated Press writer Almudena Calatrava and AP video journalist Paul Byrne contributed to this report.