The Argentinean government doesn’t seem to be pro business, and this has become more evident as many multinational companies have suddenly decided to wind up shop in Latin America’s third largest economy.
Reports are coming in to confirm that this is all not because of the Covid-19 created lockdown led slowing of the economy. In fact, there has been mounting pressure on the multinationals invested into Argentina. Some of the constant hurdles faced are that from factory unions, price and currency controls, volatile and imbalanced political weather in the country, not to mention, intervention from the state itself.
It has now been confirmed that many auto part making companies, garment manufacturers and even airline companies are shifting shop off from Argentina.
The Latam Airline Group for example will be closing shop after having been in the country for close to 15 years. The company has shared the state of constant friction amongst employees, loss of man hours and low productivity as just a few reasons to start with.
Those who are staying put are surprisingly shelving their investment plans and projects too. Political analysts believe that another reason for the business climate going down the spiral is due to change of leadership where President Alberto Fernández has taken office in December 2019. Things have been even more unstable that they were earlier.
It has been noted that his administration has tightened the access to dollars, increased taxes, and banned layoffs. There is a lot of state interference in the way foreign companies would want to run the show. The government’s decision to default on the country’s foreign debt, after negotiations with bondholders stalled, and moves to expropriate one of the nation’s largest soy exporters haven’t endeared him to foreign investors, either.
Many foreign companies winding up businesses include Axalta Coating Systems, German Paint company BASF, French auto parts maker Saint-Gobain Sekurit, to name a few. Most of them have said that the pandemic led slowdown in not the real reason for their decision to close shop. It’s the non cooperative climate maintained by the current leadership which makes it difficult to run any profitable business in Argentina anymore.
Read more articles:
EU seeks to reopen legal battle against Apple for unpaid taxes worth €13bn
The Canada and China Committee Needs A Comeback
My enemy’s enemy is my friend – Iran backs Turkey in Libya
What Is Worrying Mali After The Military Coup?
EU lacks consensus over Belarus sanctions, Cyprus demands similar treatment for Turkey
Europe3 weeks ago
Minors Rescued Relocated From Fire Gutted Relief Camp in Greece
Asia-Pacific3 weeks ago
China Australia ties under strain over recent raids on journalists from both the sides
Africa2 weeks ago
Corruption Monster Grips South Africa In COVID Recovery Times
Asia-Pacific2 weeks ago
Yoshihide Suga set to be the next Japan PM after winning the LDP leadership election
North America2 weeks ago
López Obrador urges senate for a plebiscite to decide the fate of Mexico’s former presidents
Africa2 weeks ago
Among the protests, Sudan is experiencing the most devastating rainy season in the last 100 years
Politics2 weeks ago
Pro-democracy protestors gather for a mega rally in Bangkok
Africa1 week ago
Farmaajo appoints a close associate as the prime minister of Somalia