Infrastructure: Networks to Sustain Development Agribusiness Biotechnology Renewable Energies INFRASTRUCTURE Automotive Agricultural Machinery Technical and Professional Services Software
Infrastructure: Networks to Sustain Development GDP 2003-2010 (billion AR$, constant prices) Annual GDP growth of 7.1% over the period of 2003-2009 2010 GDP growth 9.2% Expansion of infrastructure networks is a condition for sustainable growth 450 350 250 150 50-50 2003 2004 2005 2006 2007 2008 2009 2010 Source: SUINV based on World Bank, BCRA and INDEC
Infrastructure, the sector s potential: A view from the demand Evolution of Electricity Generation (In GWh) 140,000 120,000 100,000 80,000 The recent evolution of several indicators provides further evidence regarding theneedtoexpand infrastructure networks 60,000 40,000 20,000 0 2003 2004 2005 2006 2007 2008 2009 2010 Source: Undersecretariat of Investment Development based on INDEC
Infrastructure, the sector s potential: A view from the demand Evolution of Phone Calls (In thousands) 18,000,000 16,000,000 Local Phonecalls Long Distance Phonecalls 14,000,000 12,000,000 10,000,000 8,000,000 6,000,000 4,000,000 2,000,000 0 2003 2004 2005 2006 2007 2008 2009 2010 Source: Undersecretariat of Investment Development based on INDEC
Infrastructure, the sector s potential: A view from the demand Evolution of Subway Passengers 350,000 300,000 250,000 200,000 150,000 100,000 50,000 0 2003 2004 2005 2006 2007 2008 2009 2010 Source: Undersecretariat of Investment Development based on INDEC
Infrastructure, the sector s potential: A view from the demand Evolution of Local Flights Passengers (In thousands) 7,000,000 6,000,000 5,000,000 4,000,000 3,000,000 2,000,000 1,000,000 0 2003 2004 2005 2006 2007 2008 2009 2010 Source: Undersecretariat of Investment Development based on INDEC
Infrastructure, the sector s potential: A view from the demand Evolution of Cell Phones (In units) 700,000 600,000 500,000 400,000 300,000 200,000 100,000 0 2003 2004 2005 2006 2007 2008 2009 2010 Source: Undersecretariat of Investment Development based on INDEC
Infrastructure, the sector s potential: A view from the demand Evolution of Vehicles Paying Toll 400,000 350,000 Vehicles paying toll in National Highways Vehicles paying toll in Buenos Aires City's access 300,000 250,000 200,000 150,000 100,000 50,000 0 2003 2004 2005 2006 2007 2008 2009 2010 Source: Undersecretariat of Investment Development based on INDEC
Infrastructure, the sector s potential: A view from the demand Evolution of National Public Spending in Infrastructure (%GDP) 2.5 2 Energy and fuel Transport Water and sewerage Communications Housing 1.5 1 0.5 0 2003 2004 2005 2006 2007 2008 2009 2010 Source: Undersecretariat of Investment Development based on Budget Office 9
Infrastructure, the sector s potential: A view from the demand Total PublicSpendingonInfrastructure(WaterandSewage+ Housing+ Energy and Fuels + Transport and Communications) Evolution(%GDP) Economic Classification of Public Spending 6 Current Spending Capital Spending 5 Housing 0.59% 99.41% 4 Water and Sewerage 16.96% 83.04% 3 2 Energy and Fuels 78.46% 21.54% 1 Communications Transport 65.63% 53.03% 34.37% 46.97% 0 2003 2004 2005 2006 2007 2008 2009 2010 Source: Undersecretariat of Investment Development based on Budget Office
Infrastructure, the sector s potential: A view from the demand Call for bids (main contracts) Transport Water and sewage Communications National Route Nº 35 Repaving: US$ 13.950.000 Planning and Building the Buenos Aires La Plata Freeway: US$143.380.000 High Performance Train Buenos Aires-Mendoza Wastewater Treatment Plant in Chubut Province: US$ 13.930.000 Improvement Acueducto in Chubut Province: US$ 10.280.000 Drinking Water Integral System in Entre Rios Province: US$ 12.830.000 Provision of the services of broadband Internet access and content control to 5192 educational centers 11
Infrastructure s Main Challenges: Northern Argentina Transport: A railwaylinkingposadas andbernardo de Irigoyen cities should be built. National Route 12 should be transformed intoa highwaybetweenthecitiesof Posadas and Corrientes. International Transport: Santa Ana and Eldorado Harbours should be improved New Bridges should be built across the Uruguay River(Alba Posse andsan Javier, among others) Water: An aqueduct to link Salta, Santiago del Estero and Santa Fe provinces should be built. Source: Undersecretariatof Investment Development based on Plan EstratégicoTerritorial, Ministeriode Planificación Federal Energy: Electricity transmission deficit Hydroelectric dams should be built at Corpus Christi and Garabí Northeast-Northwest gas pipeline should be extended in order to providenatural gas tochaco, Formosa andsantiago del Estero provinces 12
Infrastructure s Main Challenges: Northern Argentina Transport: A railwaylinkingposadas andbernardo de Irigoyen cities should be built. National Route 12 should be transformed intoa highwaybetweenthecitiesof Posadas and Corrientes. International Transport: Santa Ana and Eldorado Harbours should be improved New Bridges should be built across the Uruguay River(Alba Posse andsan Javier, among others) Water: An aqueduct to link Salta, Santiago del Estero and Santa Fe provinces should be built. Source: Undersecretariatof Investment Development based on Plan EstratégicoTerritorial, Ministeriode Planificación Federal Energy: Electricity transmission deficit Hydroelectric dams should be built at Corpus Christi and Garabí Northeast-Northwest gas pipeline should be extended in order to providenatural gas tochaco, Formosa andsantiago del Estero provinces 13
Infrastructure s Main Challenges: Southern of Argentina Transport: Trans-AndeanRailwaylinkingZapala (Argentina) andpino Hachado (Chile) cities. Building of extra lanes in the National Route 3 from Trelew to Puerto Madryn. PavingofNationalRoute40 in Chubut and Santa Cruz Provinces Energy: Extension of electricity transmission lines. Hydroelectric Dams Chihuido I and II Sea Transport: Investment Plan in order to Improve several Harbours in the Atlantic: Rawson, Puerto Madryny Comodoro Rivadavia, Río Grande and Ushuaia Source: Undersecretariatof Investment Development based on Plan Estratégico Territorial, Ministerio de Planificación Federal 14
Infrastructure, the sector s potential: A view on the resources Most Relevant Public Works Water: Building of the Submarine Sewer in the city of Mar del Plata. Building of Water Purifying plants in Buenos Aires province to improve and expand provision in the Buenos Aires Metropolitan Area. Building of the Wastewater Treatment Plant in Berazategui, Provincia de Buenos Aires. Energy: Completion of the Yacyretá Hydroelectric Dam. Ongoing construction of Condor Cliff- La Barrancosa Hydroelectric Dams Complex (1.750 MW). Completion of the Atucha II Nuclear Power Plant (745 MW). Completion of the Submarine Gas Pipeline Segundo Cruce al Estrecho de Magallanes linking Tierra del Fuego to the mainland. 15
Infrastructure, the sector s potential: A view on the resources Most Relevant Public Works Comunications: Construction of 3D and Monopulse Radars Creation of ARSAT S.A. aimed to promote the space industry in Argentina Transport: Enhancement of Belgrano Freight Railway services Increase of Aerolíneas Argentinas (Argentina s National Airway) fleet and destinations Extension of the Subway Network in the Autonomous City of Buenos Aires Building of 2.000 Km of highways and 34.000 km. of paved routes that were added to the existing roads network. Among them it should be highlighted the Highway Nº 14 linking the main productive regions in the country (Buenos Aires-Rosario-Córboba) 16
Infrastructure, the sector s potential: A view on the resources A solvent public sector 30% 25% 20% 15% 10% 5% 0% -5% GDP Growth National primary balance Current a ccount Twin fiscal and current account surpluses (1.7% and 1.0% of GDP, respectively in 2010) provide strong foundations for continued economic growth -10% 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 Source: SUINV based on World Bank, BCRA and INDEC
Infrastructure, the sector s potential: A view on the resources A reliable legal framework Public Private Partnerships In 2005 the national government issued a decree (967/2005) aimedto facilitate partnerships between the public and private sectors to develop infrastructure projects and services. Thus, both sectors will share risks and the coordination will be improved. Fiduciary Funds Fiduciary Funds are mainly aimed to provide greater stability tothe financing of infrastructure projects. As they isolate their resources from the rest of the budget infrastructure budget can not be the target of spending cuts. Moreover, the implementation of trust funds has been part of a regional trend to seek financial instruments that enable public private partnerships to finance infrastructure works. Currently, several Fiduciary Funds(FF) in Argentina are aimed towards promoting infrastructure development
Argentina: A Strategic Investment Destination to Meet the Demandof Global Markets Provincial investment projects Undersecretariat of Investment Development Ministry of Foreign Affairs, International Trade and Worship June 2011
Investment opportunities in Argentina Provincial projects During the Investment Mission to Germany, the Undersecretariat for Investment Development is promoting different investment projects sponsored by Argentine provincial governments, displaying the diversity of business opportunities existing in the country. 20
TRANSPORTE Energías Renovables Automotriz y Autopartes
Province of Neuquén: South Trans-Andean Railway (completation works) Investment opportunity: Completation of the Trans-Andean Railway project, connecting the ports of Talcahuano (Chile) and Bahía Blanca/San Antonio Oeste (Argentina): 210 final kilometres of works between Zapala and Lonquimay. Main Advantages: technical asistance; fiscal benefits; financial facilities. Total Investment: US$ 500 millons.