Towards a world-class investment ecosystem
Argentina is at a crossroads to redefine its role in the global investment landscape.
Wall Street | Photo:CEDOC
Argentina is at a historic crossroads in redefining its role in the global investment landscape. Argentina faces a crucial challenge: how to attract and retain investments in an increasingly competitive and changing global context. The key lies in two main aspects. First, in factors that are difficult to control, such as regulatory frameworks and macroeconomic conditions, which define a nation's ability to generate an ecosystem that enhances local talent and attracts foreign capital. Second, in the need to take an active leadership role to create the conditions that allow Argentines to be at the forefront of the development of an increasingly robust investment ecosystem. The question that arises then is: What place should Argentina occupy in the investment ecosystem?
Global context
The current global scenario presents challenges and opportunities. The pandemic and the economic crisis have accelerated transformations in several industries, changing the behavior of investors. According to United Nations data, global foreign direct investment (FDI) fell 35% in 2020, the lowest level since 2005. However, sectors such as technology, where Argentina has a unique opportunity, have shown a rapid recovery.
The growth of the digital economy, the transition to renewable energy and the e-commerce boom - to name just a few - also present our country as an attractive destination if local talent is harnessed. We have a solid foundation in technology and science, with a vibrant entrepreneurial ecosystem that has given rise to unicorns such as Mercado Libre, Globant and OLX. These success stories demonstrate that, with the right policies, Argentina can attract significant investment in high value-added sectors.
But there is another key factor. If we consider that there are currently 250 billion dollars that belong to Argentines and are circulating around the world, how can we intelligently leverage that money that is outside the country to generate an ecosystem of 5,000 billion dollars that pivots on local talent? How do we create the conditions for Argentines to carry those investments forward? The solution to this question is crucial for the country not only to attract foreign capital, but also to channel its own wealth effectively.
Stability and predictability. One of the main challenges facing Argentina, then, is to generate a stable and predictable environment for investors. Macroeconomic volatility and political fluctuations have historically been an obstacle. However, recent efforts by the government and the private sector to stabilize the economy and create a clearer regulatory framework are beginning to bear fruit.
The creation of a favorable investment environment depends not only on economic factors, but also on the country's ability to provide legal certainty, transparency and efficiency in public management.
New investment paradigm. That said, another key question is: how do we build an Argentine investment ecosystem led by Argentines? To achieve this potential, it is crucial that Argentines take a leading role in the development of this ecosystem. This question is central for Argentina not only to attract foreign investment, but also to empower its citizens to become protagonists in building a stronger economic future.
No one doubts that Argentine talent is one of the country's most valuable assets. It is known that countries that invest in education, science and technology tend to have a greater capacity to attract quality investment and generate innovation. However, brain drain remains a challenge. We must therefore develop policies that encourage the retention of talent - especially in crises such as the current ones - and create a favorable environment for entrepreneurship and innovation. This will not only attract investment, but will also enable the country to position itself as a regional innovation hub.
Sustainable ecosystem. In conclusion, Argentina has a unique opportunity to redefine its role in the global investment landscape. For example, the RepensAR Summit, to be held on September 10, is a step in that direction, providing a space for dialogue and reflection among the main players in the sector.
The road to a solid and sustainable investment ecosystem will not be easy, but the potential benefits are enormous. It is time to rethink the future and build an Argentina that is a protagonist on the global stage, led by Argentines who take on the challenge of developing a powerful investment ecosystem.
(*) By Ramiro Juliá, CEO of Americas Capital Investments and Francisco Sosa del Valle, CEO of Bunker and organizers of RepensAR Summit.
by Ramiro Juliá and Francisco Sosa del Valle
Source: News