For the president of the Davos Forum, “many companies see that this is the time to invest in Argentina, later it may be more expensive for them”

In addition to giving a special speech at the edition of the World Economic Forum held in Buenos Aires between Tuesday and Wednesday, Javier Milei received the leadership that works for the famous business meeting mechanism that meets January after January in the luxurious Swiss village of Davos. Among them were former Norwegian Foreign Minister Børge Brende, now president of the WEF, and Marisol Argueta, regional director of the World Economic Forum.

After a speech in which he attacked the mythical Forum earlier this year, the Milei Government called for made in Argentina a version that is what happened yesterday. And this was the second time that Davos met in Buenos Aires as it did during the Macri government. Yesterday Milei assured that will attend Davos at the end of January for the new edition of the Forum whose motto is “Collaboration in the age of intelligence.”

In his speech, Milei delighted the ears of investors by saying that he had arrived to put a restraint on the State. Clarion interviewed Brende this Wednesday at the Alvear Icon, where tight security showed little sympathy for the press. The official was positive about the progress of the country and warned that the risks were that the reforms undertaken would go backwards.

What are the most attractive things in Argentina today for the best and the most dangerous things that Argentina reflects to the world for investment?

Today we had more than 50 businessmen from 16 countries with us. And many of those things came up in the discussion. I think what works to Argentina’s benefit, having had the lowest foreign direct investment of any major economy in the last 15 years, is that we are seeing this changing. I think what is obvious is the mining sector. There is great interest in copper and lithium. I think also in the energy sector there are many opportunities in shale gas in general. First, there is already a strong agricultural sector that accounts for 50% of its soy and beef exports. I think there is interest in also investing in modernization and technology. We also heard today that there is interest in using Argentina as a center for new technologies, AI machine learning, because those centers need a lot of energy. So there is energy available here and there are human resources. On the challenging side, the Argentine economy is not out of the woods yet. This year it is contracting. We expect growth of more than 3% next year. Of course, that’s good. Inflation has dropped a lot, but it is still there and remains high. What international companies that are watching the reforms tell us. They see that the reforms are sincere. But what is also the risk that Argentines will tire of reforms and then return to a situation without reforms? And what impact will that have on your investments? I think that’s a question.

What do you mean by this is that the change is so extreme that there is fear of a return to the populism and protectionism of the past like during the Kirchner government?

I worded it a little differently than that. I’m trying not to get involved in Argentine politics. That is not the role of the World Economic Forum. But what we are hearing is that there is a lot of interest in investing in Argentina. And I think a lot of companies also see that this might be the right time because if the economy starts to really grow, things get more expensive too. So, you know, investors also want to jump in when they see something moving in the right direction. And there is optimism among global companies, an interest in Argentina, Argentina. That’s for sure. But what I am also saying is that if billions of US dollars are invested in the country and now there is deregulation, there is less bureaucracy. There is also a policy that invites you to look. They would like, well, if they invest their money, we would also like these reforms to continue.

That is why the fear is that the reforms are not complete…

I believe that the reforms are not easy for the Argentine people either. The reforms continue today. But of course, if you are in a situation where you will see the results of the reforms. Welcome the future. First of all, people can get tired and also frustrated. But what the companies said today is that they think there is no turning back.

National or international companies?

All of the companies said they believe their reforms will continue. And, of course, there can always be a question of pace and speed. Until now, it has been more than ten months. There have been fundamental reforms. And I think this will also be something that companies will follow very closely. But these are things that are up to the Argentine people to decide. You know, we’re just watching this.

What was said about the much-mentioned “exchange trap” in Argentina that, despite promises, the Government still has not opened?

It didn’t come up as one of the questions from the international business community today, because the way we did it was we also had a lot of cabinet members. All ministers were there and took questions from the national business community. So this regulation of capital inflow did not arise and capital outflow did not arise as an important issue in those issues. What emerged was how all the infrastructure and reforms will continue. What are the investment opportunities in mining, what are the investments, opportunities in infrastructure? What more these specific questions.

Both the state government. The United States and financial organizations including the IMF have asked the Milei government, given its enormous adjustment of the economy, to remember the most vulnerable. Is it an issue between you?

This is a very challenging balancing act because fiscal measures had to be taken because the deficit was huge, 200% inflation was hurting, especially the poor. So that had to be under control too. But what is incredibly important for the government is that growth returns because without growth, there is no more money for the government to spend on either education or infrastructure in the future. That’s why I think it’s good that we expect 3.5% growth in Argentina next year. And with growth, there is also an opportunity for the government to set priorities. Where do you want to make your priority? Do you want to invest it in science, education, healthcare? But we at the World Economic Forum don’t go in and make concrete recommendations about it. But for my part, what I know from what was very clear is that if the economy is not growing…. Combined with that type of hyperinflation, it is a toxic situation. And the Argentine economy had to be stabilized. And now it’s starting to grow again. Then, Argentina will also be able to make its own decisions. Where do you want to allocate this money? So do you want to reduce your deficit even further? Do you want to give it as a tax reduction to the people? Or do you want to do more social programming? But that depends on Argentine decision makers.

What differences do you find between the Milei who went to Davos and shouted at everyone that they were communists and socialists and the one you saw now at your meeting?

I had a meeting with the president before I went into the meeting where he spoke. And then we had a meeting at the presidential palace, afterwards, I financed it very practically. I finance it by looking at what needs to be done in Argentina to recover growth and control inflation. When we were at the presidential palace, he also said that he appreciates cabinet meetings where they are very granular and when they can get into the policy actions that are needed. So I see that today the president was very practical and very involved in the details of the reforms and was less about geopolitics. It was more about the economic reforms in Argentina, how they are going. In Davos he confirmed his participation (next meeting in January) how we can also ensure that he will meet with future investors. And there is a lot of interest as we are going to do like a lunch for 30 global CEOs that I think is going to be like it’s going to be like half an hour after opening it that there is a lot of global interest in Argentina. And let’s also not forget that, even with its great economic challenges, it is still a G20 economy, it is still a great economy with, you know, vast resources. Yes, 50 million, 48 million people, vast resources. So I think the president is now building on that momentum. And put a lot of charm with the international business community today.

Talking about the G20, don’t you think that the anti-multilateralist and anti-consensus, ultra-conservative discourse of the Milei government regarding gender policies and the fight against poverty and climate change may go down badly with more liberal and progressive investors?

That’s why I think it’s true that politics in today’s world is complicated. Sometimes it also becomes identity politics. And that is something that we are seeing in many parts of the world, not only in the United States, but also in Europe. But I would say that because of the sheer size of Argentina, the economic reforms that are taking place and the opportunities, I think what I felt today with the CEOs and the business committee is that they focused more on that. The other things, you know, are not so interesting. And also, if we look at it from a bird’s eye view, let’s look at the United States now being the most successful global economy. It is growing and they have a very polarized political system. But the economy is still doing well. So there are many paradoxes here. So it’s nothing the forum can get into. We are more observant like the press in this.

So, if ten months have passed since the Milei government, what are companies waiting for to announce investments that they have not yet announced?

I think this is now like a snowball effect. You know, the snowball is very small at first, but if it starts rolling, it goes faster and gets bigger. So what Argentina has to hope for is that the interest now is like you could see a snowball effect. But still, I wouldn’t say we’re facing a snowball effect, but there’s a potential snowball building now and those mountains can start rolling if things go the right way.