Trade

Argentine exports are fairly well diversified. However, although agricultural raw materials were 20% of the total exports in 2010, agricultural goods including processed foods still account for over 50% of exports.

Soy products alone (soybeans, vegetable oil) account for almost one fourth of the total. Cereals, mostly maize and wheat, which were Argentina’s leading export during much of the twentieth century, make up less than one tenth now.

Industrial goods today account for over a third of Argentine exports. The country exported 448,000 motor vehicles in 2010, mostly to Brazil. Motor vehicles and auto parts are the leading industrial export, about 10% of the industrial exports. Chemicals, steel, aluminum, machinery, and plastics account for most of the remaining industrial exports.

Trade in manufactures has historically been in deficit for Argentina, however. Accordingly, the system of non-automatic import licensing was extended in 2011, and regulations were enacted for the auto sector establishing a model by which a company’s future imports would be determined by their exports (though not necessarily in the same rubric).

A net energy importer until 1981, Argentina’s fuel exports began increasing rapidly in the early 1990s and today account for about an eighth of the total. Refined fuels make up about half. Exports of crude petroleum and natural gas have recently been about around US$3 billion a year.

Argentine imports have historically been dominated by the need for industrial and technological supplies, machinery, and parts, which were US$38 billion in 2010 (two-thirds of total imports). Consumer goods including motor vehicles make up most of the rest. Trade in services, historically in deficit for Argentina, is currently balanced at around US$12 billion each way.

Foreign Investment

Direct investment in Argentina by the U.S. is mainly in telecommunications, energy, financial services, chemicals, food processing, and vehicle manufacturing. The U.S. direct investment in Argentina approached $16 billion at the end of 1999, according to the embassy estimates.

Investments from Canada, Europe, Chile, and other countries have also been significant. In all, foreign nationals hold around US$80 billion in direct investment.

Brazil has, since 2000, also became an important investor in Argentine assets and Spanish companies in particular have entered the Argentine market aggressively, with major investments in the petroleum and gas, telecommunications, banking, and retail sectors.

Several bilateral agreements play an important role in promoting U.S. private investment. Argentina has an Overseas Private Investment Corporation (OPIC) agreement and an active program with the U.S. Export-Import Bank. Under the 1994 U.S.-Argentina Bilateral Investment Treaty, U.S. investors enjoy national treatment in all sectors except shipbuilding, fishing, nuclear-power generation, and uranium production. The treaty allows for international arbitration of investment disputes.

Argentina attracted $3.4 billion in foreign direct investment (FDI) in 2006; as a percent of GDP, this FDI volume was below the Latin American average. Current Kirchner Administration policies and difficulty in enforcing contractual obligations had been blamed for this modest performance.

FDI accelerated, reaching US$8 billion in 2008, while slowing to US$4 billion in 2009 and recovering to US$6.2 billion in 2010.