Coface Group


Population 42.7 million
GDP per capita 12,735 US$
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major macro economic indicators

  2013 2014  2015 (f)  2016 (f)
GDP growth (%) 2.9 0.5 1.2 -1.0
Inflation (yearly average) (%) 26 23.9 30  38
Budget balance (% GDP) -3.7 -5.4 -7.1  -5.5
Current account balance (% GDP) -0.8 -1.0 -2.1  -2.3
Public debt (% GDP) 40.2 45.2 52.1  55.0


(e) Estimate  (f) Forecast


  • Natural, agricultural, energy and mineral resources
  • Education level higher than the regional average
  • Qualified labour


  • Dependency on the prices of agricultural commodities
  • Budgetary policy not very rigorous
  • Mediocre business environment
  • Insufficient investment in energy and transport
  • The State has had no access to international financial markets since 2001


The policy adjustment should lead to the contraction of activity in 2016

Private consumption should be particularly affected by the first results of the internal policy adjustment managed by the new president Maurico Macri. It should slow under the impact of the peso’s depreciation, which affects the purchasing power of households that depends on many imported goods because of the weakness of local production. The reduction in subsidized tariffs on electricity (the price could reach up to 700%), gas and transport should also contribute to the decline in the purchasing power. On the public consumption side, a revival of activity by the government seems already compromised: local authorities are committed to reduce public spending in order to redress public accounts. The wait-and-see approach of investors should continue, despite the signing of a historic agreement in principle with the “vulture funds” in February 2016 that should enable the country to regain access to international capital markets in the first half of this year. Investors should expect a more favorable legal framework, notably the reform of the judicial system that was already mentioned by the president, but has not been yet debated in Congress. External trade, the manufacturing industry in particular (especially cars) should also be affected by the Brazilian economic crisis, the largest trading partner of Argentina. By contrast, agricultural exports should grow at least in volume due to the lifting of taxes on agricultural exports (except for soybeans), but remain affected by low commodity prices. Finally, inflation is expected to increase in line with the recovery in energy prices. Its progress will also depend on the ability of the government to gradually remove the indexation of wages and restore the operational independence of the central bank.


Public and current account deficits will not be eliminated in the short term

In 2015, there was a widening in public deficit under the effect of increased spending prior to the election. The government, fearful of the repetition of social unrest, increased the budget for energy subsidies, as well as wages and remuneration for a range of jobs. In 2016, the government will likely apply tightened fiscal and monetary policies. The first measures already taken were to remove capital controls for commercial transactions and let the peso fluctuate freely, leading to a sharp depreciation (30%) of the largely overvalued local currency, and also to remove taxes on agro products (except for soya) and industrial exports. Bringing the growing deficit under control will not be an easy task given the important share of subsidies. The previous government was paying huge subsidies on energy and transport prices, sectors neglected by private investors because of the lack of protection offered by the legal system. The country continues to be excluded from the international markets and will have to continue making use of bilateral financing, mainly from China, to finance its public deficit. The government will likely work to solve the dispute between Argentina and the ‘Vulture Funds’ during 2016 in order to regain access to external private finance and avoid recourse to issuing money to finance the deficit. The lack of a majority in the Congress will, however, be an additional obstacle as any decision relating to any agreement must be submitted to that body.

In terms of foreign trade, the country remains extremely dependent on energy imports because of investment shortfalls in the sector, despite its abundance of natural resources (oil and gas). Agricultural exports (soya, maize and wheat), which account for almost 60% of all export sales, should rise as a result of the depreciation of the peso and the removal of taxes, but harvests could be reduced because of weather events associated with the “El Nino” phenomenon. Exports of manufactured goods (in particular automotive) are likely to decline, hit by the slowdown in demand in Brazil (the leading export market). As a result, the current account deficit should rise slightly in 2016. The resolution of the conflict with vulture funds should nevertheless allow the country to borrow on international markets at a cheaper price and be able to finance its current account deficit in absence of sufficient level of FDI.


The arrival of the Right to power marks the end of ‘Kirchnerism’

Elected in November 2015 with 51.4% of the votes, the new President, Mauricio Macri, a Liberal, led the Right to power for the first time in twelve years. The President, who is part of the “Cambiemos” coalition, is not, however, supported by a majority in Congress and will have to form alliances to get his reforms through. He is facing a number of challenges, in particular that of restoring an economy shaped by populist policies and State interventionism. He can already boast of an important victory in resolving the conflict with the vulture funds. He hopes to be able to restore the relations with the country’s trading partners and rebuild the confidence among investors that was undermined by commercial protectionism, nationalisations and the failure to comply with the rulings of the International Centre for Settlement of Investment Disputes (ICSID) in the context of the policies implemented by the previous administration. These changes are, however, going to encounter resistance from the powerful trade unions and Peronist factions still leading the Congress.


Last update: March 2016



The most common payment instruments in local commercial transactions are cash, Bank transfer and Cheques.  In case of default, post-dated cheques -as credit payment instruments- represent an executable legal document which facilitates a fast track legal proceeding.


For international commercial transactions, the most common payment instrument is Bank transfer via SWIFT. Currently, there exist various foreign exchange controls and, as a general rule, all transfers of foreign currency to and from Argentina are subject to many restrictions and requirements set forth by the applicable foreign exchange authorities. Importers require an Import Prior authorization (DJAI) from the Argentine Federal Tax Authority (AFIP) to get the fund transfer approval from the Argentine Central Bank. Payments to related foreign companies are usually denied.



Debt collection


Amicable phase:

The amicable collection and an out-of-court settlement are always preferable to legal actions. Negotiations are focussed on the payment of the principal, plus any contractual default interest that may be added and accepted by the buyer.  However, debt collection in this phase is usually subject to write-offs and payment plans and accrued interests are rarely recovered for foreign currency debts. The main instrument to execute the agreement in this stage is a notarized acknowledgement of debt or a payment plan, which is an instrument that may be executed through an executory judicial proceeding. Such document has to be signed by creditor & debtor and must be notarized. If possible, the inclusion of guarantees (such as a promissory note) is also advisable. In this stage, costs and fees incurred are borne by each party, respectively.


Legal proceedings:

Argentina is a federal republic organized into 24 jurisdictions: 23 provinces and the Autonomous City of Buenos Aires (federal district). Each jurisdiction establishes its own court structure and organisation within its territory and its rules of procedure.


The Argentine judicial system is divided into two parallel judicial systems: federal courts (organised by the federal government) and provincial courts (organised by each province or federal district). The supreme judicial power of Argentina is vested in the National Supreme Court of Justice.


In principle, Argentine courts have jurisdiction if (i) defendant is addressed in Argentina, (ii) the place of performance of any of the obligations is located in Argentina, or (iii) Argentine courts have been chosen as the applicable forum (subject to certain restrictions). With respect to debtors addressed abroad, there is jurisdiction only to the extent that the debtor has assets in Argentina (in which case the insolvency proceedings will only involve such assets) or when its principal place of business is in Argentina.


Argentine regulations contemplate alternative dispute resolution methods. In some jurisdictions compulsory pre-trial mediation proceedings have been determined. The agreement reached between the parties must be signed by the mediator, the parties and any others participants. If no agreement is reached, creditor may initiate legal proceedings.


The Argentine Civil and Commercial Code of Procedure (modified and updated in the year 2015) classifies proceedings into two types depending on their purpose:fact-finding or ordinary (“juicio ordinario”)andexecutory or fast-track (“juicio ejecutivo”). There are other types of proceedings which apply only to particular cases.


Ordinary proceedingsinclude different stages. Generally, such proceedings are initiated by the parties submitting pleadings, followed by a stage in which evidence is provided and assessed. Subsequently, the court issues its decision and, eventually, parties may appeal said judgment provided certain conditions are met.


Executory processesare simplified and prompt proceedings that mainly consist of claimant’s request of the execution of debtor’s assets to obtain payment of a debt. Executory proceedings applies when creditor has documents known as executory titles (“títulos ejecutivos”), such as public instruments, private instruments signed by the concerned person and legally acknowledged, judicial confessions of debts, bills of exchange, promissory notes, checks or credit invoices. The evidence stage is avoided, there’s no need to prove the debt (the executor titles are enough).


Plaintiff’s petition must basically contain a memorandum of the facts in Spanish, the claimed amount, the documentary evidence supporting the claim and other means of evidence and include the signature of an attorney. All documents used as evidence in court must be drafted in Spanish (or translated into Spanish by an official sworn translator) prior to their being admitted by a court.


Costs involved in judicial proceedings usually include court tax (equal to 3 % of the amount in dispute to be paid by claimants upon commencing the proceeding), lawyers’ fees and experts’ fees. In principle, the prevailing party is entitled to recover its costs, including attorneys’ fees. However, the court may determine otherwise.


Insolvency proceedings:


(i) Reorganization proceeding (“concurso preventivo”): A reorganization proceeding may only be initiated voluntarily by an individual or entity who must submit proof of its inability to pay its debts. Debtor must file a petition to the court requesting relief under the Bankruptcy Law. The court will appoint a trustee. All creditors must file evidence of their proof of claim with the trustee (“verificación de crédito”). Debtor must submit a proposal for reorganization and must obtain their approval. If the proposal is not approved by the required majorities, debtor bankruptcy may follow.


(ii) Bankruptcy (“quiebra”): A bankruptcy proceeding may be initiated upon failure of a reorganization proceeding and may also be initiated either voluntarily (by debtor) or involuntarily (by debtor’s creditors request).

Unlike reorganization, debtor is removed from the administration of its assets and a trustee is appointed in order to preserve and administer debtor’s property. Hence, all payments to creditors and debtor must be made through court. As in reorganization proceedings, all claims and proceedings against debtor are automatically stayed as from the date of the order that determines debtor’s bankruptcy. All creditors must submit their proof of claims for payment. Once the assets available and the amounts owned to each creditor are determined, the trustee liquidates the assets and proceeds with the distribution to creditors. Then the bankruptcy proceeding concludes and debtor is discharged. 

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