Tuesday, March 31, 2020

ECONOMY | 14-01-2018 00:03

Economy in brief: decrees, bonds, Corporación América

This are the main stories from last week.


President Mauricio Macri this week signed an extensive decree package aimed at slashing bureaucracy and attracting investment. The package is designed to attract investment by improving importers’ access to local markets. It also authorises the ANSES welfare fund to invest in financial services, among other changes. The national government hopes the measures, designed to “simplify” and slash bureaucracy, will reduce productive costs by one percent of the country’s Gross Domestic Product (GDP) over two years, Production Minister Francisco Cabrera told reporters on Wednesday afternoon. Some of the proposed changes will be implemented from as early as Thursday.

Among them, the government will automate 314 import licences and create a so-called Secretariat for Production Simplification.

The decree package includes measures that will affect the operations of the Central Bank, eight ministries (Modernisation, Production, Labour, Finance, Transport, Culture, Agriculture and Mining), as well as two decentralised state entities (ANSES and the Administrative Agency of State Assets).In the area of transport, the government aims to “reduce logistical costs” by 20 percent and allow trucks to carry an additional 10 tonnes, to a maximum of 60 tonnes. The package includes a decree that will allow ministries to open up ports without the authorisation of president, while commercial operations for nine airports were also authorised. Controversially, the government weakened measures to punish businesses that infringe labour regulations by reducing the period of time a company or individual can be included on the Public Record of Employers with Labour Infractions (REPSAL) and removing firms or individuals who obstruct inspection processes.


The government sold US$9 billion in a popular bond issuance on Thursday, a figure that covers close to third of the year’s financing requirements. The three-part sale was made up of fiveyear, 10-year and 30-year dollar bonds. Argentina received orders for US$21.4 billion, the government said, illustrating high demand.


Soy farmers are reportedly planning to take the risk of planting later than usual this season due to a continuing drought in Buenos Aires province, Reuters reported this week. According to the Buenos Aires Grain Exchange, an estimated 2.25 million hectares of land has yet to be sown, with rainfall anticipated to arrive next week.


Corporación América Airports SA is looking to sell as many as US$750 million of shares in an initial public offering toward the end of this month, in the first Argentine IPO listing of the year. In a revealing interview with Bloomberg, Eduardo Eurnekian said he would be slowly retiring from the airport business and passing the baton to his nephew, Martín Eurnekian. “I am doing this IPO, but that doesn’t mean I’m in charge - the one who manages the airports is my nephew. I will oversee this deal this month, and my career in airports will be complete,” Eduardo Eurnekian told Bloomberg, saying he intended to use the time freed up to explore prospective new business opportunities. 

Corporación América Airports SA, which according to Bloomberg owns concessions in 51 airports worldwide, will use at least part of the proceeds to expand both the Ezeiza and Jorge Newberg City airports and develop hotels onsite, Eurnekian said. The Argentine-Armenian entrepreneur, 85, has hired Bank of America, Oppenheimer, Goldman Sachs and Citigroup to sell stocks.


Local biotech firm Bioceres has applied to the US Securities and Exchange Commission for permission to operate on Wall Street, reports said this week, ahead of the company’s scheduled initial public offering later this year. Bioceres CEO Federico Trucco told Reuters that the planned capitalisation would seek to bring in US$100 million as part of a “growth plan” that would smooth operating finances, pay down debt and allow the firm to “make a minor acquisition.” 

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