On June 16, the Board of Governors of the Asian Infrastructure Investment Bank (AIIB) approved Argentina’s membership in the institution. This resolution was made at the 2017 AIIB 2nd Annual Meeting in Korea.

This way, Argentina will be able to present projects for infrastructure development and creation of jobs. As a result, our country increases its financing tools for the economy’s growth.

The AIIB, among other operations, will be able to finance, co-finance or participate in projects for economic development, provide technical assistance and special resources. Its areas of interest are: energy, transport, telecommunications, infrastructure in rural areas, agricultural development, urban development, water supply, sanitation services, environmental protection and logistics, among others.

In addition, in May, President Mauricio Macri, during his speech at the “One Belt, One Road for International Cooperation” Forum in China, highlighted the work done by the Government together with Asian institutions and he expressed his wish to become member of the Asian Infrastructure Investment Bank.

The AIIB is a multilateral financial institution that began working in January 2016 and at present it comprises 56 member-countries: 37 belong to the region and 19 non-regional members. Founded by a Chinese initiative, the AIIB has an authorized capital of up to USD 100 billion, consisting of the contributions done by regional and non-regional member countries. Likewise, it pursues sustainable economic development, the creation of wealth and the improvement of connectivity in infrastructure, promoting regional cooperation with multilateral and bilateral development organizations.

June 19, 2017

The Ministry of Finance announces the issuance of a 100-year bond for USD 2.75 billion with a coupon of 7.15% and yield at 7.9%.
This transaction is part of the Government’s objective to guarantee financing under the best possible conditions for the growth of the country and the creation of jobs.

Despite today’s uncertainty in international markets, the Government proves, with its administration, the ability to obtain very long-term financing at the lowest nominal rates of Argentine history.

“An issuance of this kind is possible thanks us being able to recover the world’s credibility and its confidence in Argentina and the future of our economy,” Finance Minister Luis Caputo said.

With this issuance, Argentina is now part of a select group of countries with 100-year sovereign bond issuances such as Mexico, Belgic, Ireland, China, Denmark or Sweden. “We are closer to countries such as Belgic or Mexico rather than to Venezuela, with whom the previous Administration used to issue debt with 5-year maturities and 15% rates. This shows confidence not only in our Administration but also in the future of the country”, Mr. Minister added.

The Minister of Finance highlighted: “This operation demonstrates prudence and responsibility: we are taking advantage of a moment of very low rates at a global level and it is important to balance the maturities of our debt”.

Caputo added: “We don’t have to lose perspective; what we are paying in this issuance is what the United States paid for their long-term debt in the 90s. Issuing debt with long-term maturities and at low rates is to conduct a responsible and prudent administration of our debt”.

June 7, 2017

The Minister of Finance, Luis Caputo, closed this Wednesday the 34th Annual Congress of the Argentine Institute of Finance Executives carried out at the Sheraton Hotel in Buenos Aires between June 6 and 7.

Within this framework, Caputo said: “Our goal is fiscal balance and we have decided to achieve it gradually considering social responsibility (we have a 30% of the population beneath the poverty line) and because we have the lowest nominal rates for financing of our history”.

Likewise, the Finance Minister highlighted: “Since we took office, we have issued debt 4 times. 3 of said issues were to cancel the previous one. This means that we are replacing said debt for a much lower coupon”. Mr. Minister added: “The level of debt over product will continue to be the lowest of the region once the fiscal balance goal is achieved”.

In addition, Caputo talked about the policies to promote credit carried out by the Ministry of Finance: “Today the private sector’s debt in Argentina is of only 15 GDP points, among other elements because credit conditions are not good, we have to take care of that”, and he added: “Longer terms and lower rates foster the creation of more jobs and the economy’s growth”.

In that sense, Mr. Minister said: “Through the three official banks we are managing the 30-year mortgage credits; it is a concrete benefit of the measures we have taken as a Government”. Also, Caputo added: “Credit will be the engine of reactivation”.

In addition, the Finance Minister said that the Ministry of Finance is working “to improve the capital market conditions, financing opportunities for SMEs and financial inclusion to fight informality”.

Regarding financing for the infrastructure plan of the National Government, Mr. Minister explained: “In addition to the bilateral agreements, we are also tackling public-private associations, which is an alternative that has proven to succeed in the rest of the region”.

Finally, the Minister of Finance said: “We have the best weather conditions for renewable energy, the second most important shale gas reserve of the world, a huge human resource and a country of entrepreneurs”, and he added: “We have the natural and the human resources to hold once a more a privileged position within global economies and we are here to deal with it”.

The Argentine Institute of Finance Executives, founded in 1967, is a nonprofit professional association comprised by executives, directors and managers of companies and institutions from the areas of finance, administration, planning, management control, treasury, accountancy and trade.