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By: Zacks Equity Research
Argentina has been making it to the headlines recently for the measures proposed by the country’s government to advance its economy. South America's second-largest economy, which has been plagued with weak growth, high inflation, declining currency and debt default issues, has been undergoing drastic overhaul since market-friendly President Mauricio Macri took over the helm of the nation in December last year.
In an interview, Horacio Reyser, Macri’s top adviser for foreign investment, stated that the President plans to send a public private partnership bill to Congress, which has the potential to increase the country’s financing capacity by $90 billion. The move would enable the government to accelerate its investment in infrastructure and facilitate corporate access to multilateral lenders and capital markets.
The government is also working to make the country lucrative for foreign investors and targeting to achieve foreign direct investment of approximately $25 billion annually. According to the United Nations’ Economic Commission for Latin America and the Caribbean (CEPAL), foreign direct investment in Argentina fell 42% year over year to $6.6 billion in 2014. Foreign direct investment in Argentina is comparatively weaker than other Latin American countries like Brazil and Chile, which attracted direct overseas investments of $62.5 billion and $22 billion, respectively last year.
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