Luis Miguel Etchevehere, Minister of Agro-industry: Interview

Intereview: Luis Miguel Etchevehere

What foreign investment opportunities are there in the agricultural industry?

LUIS MIGUEL ETCHEVEHERE: Wine, dairy products, fruits, meat and maize are some examples of the wide variety available in Argentina. There is no single Argentine agricultural product that does not represent an investment opportunity, especially given the higher demand from the Asian region. However, the vast majority of Argentine grains are exported without added value, and this is primarily due to our structural lack of competitiveness.

We are aware of this challenge and are actively working to increase our industry competitiveness, which would not only create value domestically, gradually allowing us to enter new and more sophisticated international markets, but it would also create employment. We need to focus on providing the necessary tools to our domestic production workforce, which is among the most educated worldwide.

What is the potential of Argentina’s forestry sector, and how could it impact other sectors?

ETCHEVEHERE: Argentina has a pressing trade deficit due to the import of paper, something that could be manufactured locally if processing plants that produce cellulose paste were established. There are about 1.3m ha of trees planted in Argentina, and we have the potential to increase this figure up to 3.5m ha. Jobs in the industry stand at 194,000, and we could generate a further 200,000 jobs with a bigger local industry. The opportunity is not only in the production of paper, but also in the construction sector, given Argentina’s significant housing deficit of about 3m.

What are the challenges to boosting overall competitiveness in the local agricultural industry?

ETCHEVEHERE: Argentina is an important player in the global production of high-quality foodstuff. Our goal now is to become an even bigger provider, essentially the supermarket of the world. Argentina possesses the human capital and entrepreneurial spirit needed to achieve such an ambitious objective; however, we need to increase our competitiveness in order to penetrate more international markets, with better cost structures and more attractive price offerings.

There are several challenges ahead, though, the most important of which is the current inflation and pressing fiscal burden in the macroeconomic context. The next biggest challenge is the lack of infrastructure to mitigate the impact of climate change, which can come as draught or floods. Transport infrastructure is equally important, as the logistics costs in our country makes us much less competitive than other global producers. The cost of moving agricultural goods in Argentina is three times more expensive than in the US and two times more than in Brazil. We must take advantage of the opportunity in fluvial, maritime, road, air and rail transport. The government has put a great deal of emphasis on this aspect, with a dynamic and ambitious investment plan, which will have a subsequent positive impact on local agricultural producers.

How would deeper integration among Mercosur nations help the bloc boost its international reach?

ETCHEVEHERE: In order to reach a greater number of international markets, it is essential to have more trading deals in place. In a world where protectionist measures are gaining prominence, we have an opportunity to gain momentum on the international scene.

Therefore, we must act as a bloc and deepen our internal organisation to operate as a single entity in international markets. Similarly, we must promote the free circulation of goods and people within our regional borders. There must be a true unified market, not just political, which has been the case until now.

Cooperating with Brazil allows us to access a larger portion of the global market. It has long been discussed, and our efforts have been manifested in multiple ways within Mercosur, particularly among the private sector.