This is explained in a report conducted by the Faculty of Economic Sciences at UBA
Specialist Andrés López explained that “these fluctuations are closely linked to the introduction of currency regulations (generically known as 'cepo'), which at various times affected multinational companies' access to foreign currency, both for remitting profits to their parent companies and for paying for imports made by their subsidiaries in Argentina.”
The report even emphasizes that the sharp drop in investment recorded in 2023, during the Kirchnerist economic crisis prior to Javier Milei's inauguration, was “almost entirely the result of these restrictions.” In this context, it is important to recall that, last April, the current libertarian administration announced the elimination of the currency controls.
According to López, “the percentage of investment that our country received in the '90s fell drastically in the following decade, from 1.71% to 0.48%, rose to 0.6% in 2010, and then returned in the following two-year period to the values of 2000.”
Currently, the flow of foreign direct investment in the country remains at low levels when compared to Argentina's relative share of the world's population (0.56%) and global GDP measured in purchasing power parity (0.7%).
The study also points out that this loss of prominence “is not due to a regional phenomenon, but rather to the fact that Argentina lost relative weight during the period analyzed both within South America and Latin America and the Caribbean.”
A report released by the Faculty of Economic Sciences at the University of Buenos Aires explained that Argentina lost relevance as a destination for foreign investment, and for major companies from the United States and Europe, due to the currency restrictions implemented by various previous governments, mainly the Kirchnerist administrations.
In this context, the study reveals that the decline in the country's investment appeal is also evident when compared to other nations in the region. “As a result of this trend, at present the country's share in global foreign direct investment, as well as in the activity of multinational companies, is even lower than Argentina's share in global GDP and population,” warns the study conducted by the country's leading university.
The analysis was developed by Dr. Andrés López, a researcher at the Interdisciplinary Institute of Political Economy (IIEP), which is part of the Faculty of Economic Sciences at UBA.
The document highlights that, “if one analyzes the variables of sales, value added, employment, investments, and assets in the periods: 1999-2000, 2009-2011, and 2020-2022, it becomes clear that our country has lost appeal for foreign investment.”
Meanwhile, the study shows that since 2006, when the first data began to be published, the balance of payments has reflected strong fluctuations in the inflow of foreign investment.
