Starting a Business in Argentina
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Why Start A Business In Argentina?
"The failure of Argentina, so rich, so under-populated, twenty three million people in a million square miles, is one of the mysteries of our time" wrote travel journalist and writer V.S Naipaul. Argentina is a paradox. Once an economic powerhouse of the twentieth century, Argentina has since suffered three decades of catastrophic rule, a string of despotic rulers, rampant corruption and explosive inflation. Rich in natural resources yet left teetering on the brink of economic collapse on more than one occasion: Argentina has proclaimed itself in mourning for what could have been.
The painful history of the Argentines is stamped out in the melancholy of the nations famous dance, the Tango, and proclaimed bitterly on thousands of psychologists' couches. With three times more psychoanalysts per head in the country's capital, Buenos Aires, than in New York, Argentina is a nation on the couch.
If psychiatry's not your thing, there's no need to despair. The last few years has seen the Argentine economy plateau at around three Argentinian pesos to a dollar. And, as the eighth largest country by area in the world, Argentina has space, and plenty of it. Farming on this scale has seen trade flourish - particularly soya beans, or green gold', which are shipped to China.
If the provincial lifestyle isn't for you, Argentina sports a capital city described as the Paris of South America, only hotter. And with steak at every meal. A city that never sleeps, with a thriving expat community to boot, Argentina is rife with business opportunities.
A word of warning: Argentina is a country of heroes. If Diego Maradona said in the 1986 World cup that his contested handball was ''the hand of God,'' it was. The Falkland Islands, once and for all, belong to the Argentines, just as Evita - revered wife of two-time president Juan Peron - although long dead, lives.
What's the currency and exchange rate?
The currency in Argentina is the Peso. This is represented by ARS or the symbol $.
What's the climate and weather like?
Different areas of Argentina are subject to different climates, as a result of the longitudinal and elevation variations. Predominantly, the climate is temperate with extremes ranging from subtropical in the north to sub polar in the far south. Climate in the north is typically characterised by very hot, humid summers with mild, drier winters and is subject to periodic droughts. Central Argentinean climate consists of hot summers with thunderstorms and cool winters. The southern part of the country is prone to warm summers with cold winters, which have heavy snowfall.
What's the population?
The population of Argentina is 40.3 million, the third largest in South America.
Since the early 1990s, Argentina has experienced some incredible transitions to it economic and political structure. It is now characterised by a high growth rate and a free economic framework, which is recognised as one of the most open in the world. This means that there is complete liberality to set prices and nurture domestic and foreign commerce.
Furthermore, much economic activity has undergone deregulation, including:
- Domestic trade
- Overseas trade
- Professional services
- Transport of cargo and passengers
Except for the banking industry, no prior permission is required from the government for foreign investment. This includes traditionally sensitive sectors, such as defence, national security, insurance, telecommunications, oil, gas and electricity.
What are the main industries?
For many years, one of Argentina's main industries has been agriculture. It is ranked third in the worldwide production of soya beans, fifth for maize and eleventh for wheat. Manufacturing, telecommunications and service industries are some of Argentina's other main industries.
What are its exports?
Argentina's main exports are mineral fuels and oils, residues and waste from food industries, animal and vegetable oils, and cereals.
And its imports?
Its imports are machines, vehicles, electronic and electrical equipment, and organic chemicals.
What are the essentials to know?
The Companies Law stipulates that a corporation cannot be a partner or quota-holder in a general or limited partnership, or a limited liability company. However, the courts have stated that foreign investors are not subject to this restriction.
The majority of overseas businesses establish themselves locally through a branch or stock entity. However, some investors are now commonly employing the use of limited liability companies too.
Labour and workforce
Argentina has a rather high unemployment rate, and so therefore erudite and well-trained staff are reasonably easy to employ. English is being progressively implemented as the language of business, however it may still prove difficult to find staff with such a knowledge. Recruitment is not a dissimilar process to that of the United Kingdom. There are many agencies and organisations which can facilitate your needs.
The Labour Law is rather intricate and often in transition. It is advised that you consult a professional before finalising any contractual agreements.
British Embassy Buenos Aires
Dr Luis Agote 2412 (1425)
General enquiries +54 11 4808-2200
Fax +54 11 4808-2274
Monday to Thursday: 8:45am to 5:30pm; Friday: 8:45am to 2:00pm. See Access and opening times to make an appointment for notarial services.
What's the television like?
The television in Argentina is widely viewed across Latin America. Local programmes produced in Argentina are broadcast by networks in other countries. There are five major networks. Cable and satellite television is also good, with the highest usage in Latin America.
Argentina is a pioneering nation in radio broadcasting, with the world's first radio station. There are over 1,500 radio stations licensed in Argentina. 260 run on AM frequency, and 1150 on FM.
What about newspapers?
Newspapers are highly developed and independent, with over 200 newspapers in circulation. The major national newspapers are from Buenos Aires.
What's the food like?
The food in Argentina is heavily influenced by Spain, Italy, Germany and France. Argentina has the highest consumption of red meat in the world.
What's the education system like?
After its independence, Argentina constructed a national public education system. The country is now high up in the global rankings of levels of literacy (97%). School attendance is compulsory between ages 5 and 17, and is funded by tax payers at all levels except the majority of graduate level study.
What about transport? How do I get around?
The infrastructure is advanced compared to other countries in Latin America, with over 230,000 km of road networks. The railway network also has a total length of 31,902 km. Although many services were shut down when the rail company was privatised in 1992, many services are currently being reactivated.
Organisations that can assist with Starting a Business
Multi-lingual Notaries to notarise, translate and legalise documents for international use
Simplified Global Payroll Companies with global employees often find that managing payroll in multiple countries is complicated - different systems, laws, and languages in each country, lack of reporting, and constantly changing laws and regulations each year. Trying to manage global payroll via fax and email with excel spreadsheets leads to data security issues, fines, and penalties for non-compliance. Blue Marble has solved global payroll challenges with cloud-based technology, aggregated reporting, and a hybrid service model in 135+ countries around the world.
PEO Worldwide is an international PEO offering employer of record, payroll, employee benefits management, HR and compliance services throughout the world.
Finding office space abroad poses one of the most difficult changes that many start-ups face. Location, costs, and transport all need to be considered. And, more crucially of all, what office will allow a new business to attract and retain the best staff?