AGP Executive Report

Debt and Markets: Argentina has paused local dollar-bond sales as yields climbed above 12%, complicating plans to cover about US$25 billion in hard-currency payments due next year. Economy Minister Luis Caputo says a currency swap with China remains an option if borrowing stays too costly. Trade: Argentina and the US amended their trade agreement in a bid to secure ratification, as President Javier Milei courts US investment. Tax Policy: The IMF is pressing Buenos Aires to broaden the VAT base by ending exemptions, a move that could affect prices and business margins. Mining: Investment is spreading beyond lithium, with major miners and explorers pursuing copper, gold and other critical minerals. Telecoms: Telecom Argentina accepted Metrotel’s US$450 million offer for Movistar assets. Public Spending: Thousands of students and university staff marched against funding cuts; public university spending fell about 41% in real terms in the first half of 2026 compared with the same period in 2023.

Energy Dispute: Argentina has asked an international tribunal to halt the Sea Lion oil project near the Falklands; the UK says it will protect companies involved. Trade & Financing: Buenos Aires and Washington amended their trade deal in a bid to secure ratification, while Argentina is considering a China swap to meet 2027 financing needs. Inflation & Tax: September inflation was 1.9%, taking the annual rate to 33.4%. The IMF is also urging Argentina to broaden the VAT base by removing exemptions as part of fiscal reforms. Milei’s Reform Push: Opposition lawmakers are seeking to overturn Milei’s sweeping deregulation decree, with a court ruling restoring limits on foreign ownership of rural land adding to the dispute. Mining & Exports: Rio Tinto kept its iron-ore outlook steady but expects lithium output near the low end of its range, citing a slower ramp-up at Sal de Vida in Argentina. Mendoza’s Bodega Argento, meanwhile, plans new organic and Fairtrade wine launches in UK retailers.

Debt Financing: Economy Minister Luis Caputo said Argentina could tap its currency swap with China if it cannot refinance dollar bonds due in 2027, as investor concerns push up sovereign risk. Falklands Oil Dispute: Buenos Aires has asked an international maritime tribunal to suspend the UK-authorized Sea Lion project, developed by Rockhopper and Navitas, arguing that drilling infringes Argentina’s rights. Inflation and Growth: September inflation was 1.9%, taking the annual rate to 33.4%; the IMF has cut its 2026 growth forecast for Argentina to 2.1%. Household Costs: Argentina’s basic food basket is rising faster than inflation, adding pressure on household budgets.

Falklands Oil Dispute: Argentina has asked an international tribunal to halt UK-authorized oil activity near the Falklands, while Britain says the project remains lawful and is protecting companies involved. Land Ownership: A UBA report raised concerns that strategic rural properties in Chubut were marketed to foreign buyers during a brief suspension of land-purchase restrictions; researchers say they cannot confirm whether any sales went through. Mining: Rio Tinto expects Argentine lithium output to fall short of its earlier plans, citing heavy rainfall at Olaroz and Fenix and slower progress at Sal de Vida. Economic Outlook: The IMF cut Argentina’s 2026 growth forecast to 2.1%, even as September inflation held below 2% for a second month, at 1.9%; annual inflation was 33.4%.

Inflation: Argentina’s consumer prices rose 1.9% in September, keeping monthly inflation below 2% for a second month. Annual inflation eased to 33.4%, though housing and utilities costs climbed 3.1%. Growth Outlook: The IMF cut Argentina’s 2026 growth forecast to 2.1%, as a stronger peso, tight monetary policy and austerity curb activity. Falklands Oil: Buenos Aires asked an international tribunal to halt UK-authorised exploration near the islands, escalating a dispute over the Sea Lion project, which holds an estimated 1.7 billion barrels. Britain says it will protect companies involved. Digital Payments: Russian fintech MTS has added QR-code payments in Argentina, letting My MTS users pay at local merchants from ruble accounts with automatic currency conversion.

Growth Outlook: The IMF cut Argentina’s 2026 growth forecast to 2.1% from 3.5%, citing weaker activity and tight financial conditions. It now sees inflation at 32.5%, up from its April estimate of 30.4%. Investment Push: Javier Milei is heading to Washington to court U.S. investors and reinforce ties with Donald Trump. Mining: Patagonia Gold reported high-grade gold and silver at its Calcatreu project in Río Negro, while Green Shift agreed to sell its Los Altares uranium project for cash, shares and a royalty. Trade: Italian exports to Mercosur rose 21.1% in May, the first month of the EU trade deal’s provisional application; Argentina and Brazil account for more than 90% of Italy’s trade with the bloc.

Investor Outreach: President Javier Milei heads to Washington this week to court U.S. investors and promote his economic reforms, with meetings involving business leaders on the agenda. Lithium: Lake Resources won Catamarca’s environmental approval for its Kachi project, clearing a major permitting hurdle; engineering work comes next, before any final investment decision. Financial Policy: The central bank sees no near-term progress on crypto banking measures, citing economic fragility, and is focusing on fintech oversight and fraud prevention. Business Shifts: Buenos Aires’ water company has been privatized after 20 years under state management, while reports point to growing Argentine interest in Chinese car brands and a burgeoning data-centre sector.

Autos: Chinese brands captured 10% of Argentina’s vehicle sales in August, up from about 2% in late 2025, helped by tariff exemptions for electric and hybrid imports. Their rapid growth is pushing established automakers to respond with new models. Energy and Mining: Argentina’s lithium sector advanced as Lake Resources secured environmental approval for its Kachi project, clearing the way for engineering work, while Posco completed a second lithium plant. New analysis also points to growing data-centre investment and the country’s potential to become a major energy supplier. Finance: The Central Bank has rejected near-term integration of crypto services into the banking system. Lending remains weak as banks channel funds into government debt. Infrastructure: The government agreed to return water utility AySA to private management in a US$340 million deal, ending two decades of state control.

Trade Links: Emirates SkyCargo is adding seven weekly cargo flights across Brazil, Argentina, Colombia and Ecuador, expanding regional freight capacity. Financial Policy: Argentina’s central bank rejected near-term crypto banking integration; separately, it is disputing claims of a US$1 billion loss on gold hedges as auditors scrutinize its gold reserves. Energy & Tech: Argentina’s energy resources could support ambitions to become a global supplier, while the country is also drawing investment amid the data-centre boom. Privatization: State water utility AySA is set to return to private ownership in a reported US$340 million deal, after two decades under state management. Economic Outlook: Weak August activity has revived recession concerns and led markets to cut 2026 growth expectations. Mining: POSCO has completed a second upstream lithium plant in Argentina, though the country’s broader lithium ambitions still face extraction hurdles.

Digital Finance: Argentina’s central bank says crypto services will remain barred from banks and payment systems for now, citing economic fragility; any change may wait until a second Milei term. Energy: The sector posted a $7.8 billion surplus in January–August 2026, beating the full-year 2025 total, as Vaca Muerta drives record exports. Growth: Weak August activity has revived technical-recession concerns and prompted markets to mark down 2026 growth prospects. Mining Investment: POSCO completed a second lithium plant, while RIGI approval advances Glencore’s copper project. Oil and Reserves: Argentina is preparing a legal escalation over the UK-linked Sea Lion oil project as Rockhopper expands its stake; separately, the BCRA has challenged claims of a $1 billion loss on gold hedges amid a dispute over reserve reporting.

Digital Infrastructure: Argentina is courting a global data-centre boom, with President Javier Milei pitching cheap energy, land and investor-friendly rules. But major projects remain at different stages, from operating facilities to early announcements. Reserves: The Central Bank and auditors are at odds over gold holdings, while the BCRA disputes claims that its gold hedges caused a US$1 billion loss. Growth: Weak August activity has revived talk of a technical recession, as markets mark down growth prospects for 2026. Mining Investment: Glencore’s copper hub has advanced under Argentina’s RIGI investment scheme, while POSCO has completed work on its second lithium plant in the country. Business Strains: Low-cost carrier Flybondi has filed for creditor protection after a 57-day flight suspension. Land Policy: Protesters are opposing moves to repeal limits on foreign ownership of land, a debate with implications for investment and control of rural assets.

Digital Investment: Javier Milei is pitching Argentina as a data-centre hub, citing cheap energy, land and a business-friendly framework. But major projects remain at announcement or planning stage, leaving investment promises ahead of operating capacity. Payments and Reserves: Coinbase and fintech Gennius plan to bring a USDC-backed stablecoin service to Latin American banks, with Argentina first. Separately, the Central Bank and auditors are clashing over gold reserves, keeping scrutiny on the country’s financial buffers. Energy and Mining: Glencore’s copper hub has advanced under Argentina’s investment incentive regime, while lithium and offshore energy projects add to a growing pipeline of resource investment. Privatization: Buenos Aires’ water utility AySA is returning to private hands in a reported US$340 million deal, ending two decades of state management. Business Pressures: Flybondi has filed for creditor protection after a 57-day flight suspension, while banks’ growing exposure to government debt underscores the difficulty of expanding private lending. Land Policy: Argentina’s Supreme Court has restored limits on foreign ownership of rural land, amid protests over Milei’s push to open land sales.

Central Bank: Argentina’s auditor says gold-linked derivatives cost the Central Bank $1 billion in 2025 as gold prices surged, criticizing the risk-taking even as it found the bank’s financial statements fairly presented its position. Privatization: Buenos Aires water utility AySA returned to private hands in a $340 million deal, ending two decades of state management. Investment rules: The Supreme Court temporarily restored a 15% cap on foreign ownership of rural land while it reviews President Javier Milei’s repeal, leaving uncertainty for investors. Credit and trade: Banks are loading up on government debt rather than boosting lending, while Argentina joined a US-led declaration targeting industrial overcapacity. Energy and mining: TotalEnergies plans a $1.5 billion investment in an offshore project, and POSCO has completed a second lithium plant in Argentina.

Privatization: Buenos Aires water utility AySA is returning to private hands in a US$340 million deal, ending two decades of state management. Growth Outlook: The World Bank projects Argentina will grow for three consecutive years from 2025 to 2027 — its first such run in nearly two decades — even as regional growth is forecast at 2.2% in 2026. Credit & Activity: Banks are still directing funds to government debt rather than expanding private lending, while weak August figures have raised concerns about a technical recession. Mining Investment: Posco has completed its second lithium plant in Argentina, and Pioneer secured an option on a gold-copper-silver project in San Juan. Trade & Industry: Argentina joined a US-led statement on excess industrial capacity; meanwhile, textile output is down 22% and retail sales have fallen 2.1% cumulatively.

Water Privatization: A consortium of Argentine, Brazilian and Dutch firms offered $340 million for 90% of AySA, which serves 14 million people in greater Buenos Aires. The 30-year concession is expected to transfer operations in early 2027; the bid fell short of the government’s $500 million target. Economic Outlook: August activity pointed to a possible technical recession, while banks have favored government debt over private lending. The World Bank, however, expects Argentina to grow for three consecutive years through 2027, citing fiscal adjustment and reforms. Mining Investment: Glencore’s copper hub has advanced under Argentina’s RIGI investment incentive regime, while POSCO completed an upstream stage of its second lithium plant in the country. Trade and Industry: Argentina signed a US-led pledge to address excess manufacturing capacity in sectors including EVs, batteries and semiconductors; Brazil did not join. Falklands Energy Dispute: A multibillion-dollar offshore oilfield is adding to tensions with the UK and could complicate investment around the disputed islands.

Trade Policy: Argentina joined the US and 13 other economies in a pact to examine excess capacity in autos and EVs, batteries, chemicals, semiconductors and solar panels, with sector talks and data-sharing planned. Lithium: CleanTech Lithium agreed options to acquire two properties at Argentina’s Antofalla salar, near its existing projects, with initial payments of $525,000. Economic Outlook: August’s sluggish activity has raised recession concerns and prompted markets to pare back 2026 growth expectations. Mining Investment: Glencore’s RIGI approval advances its MARA copper project, adding to a pipeline of resource developments seeking investment. Public Finance: An Argentine court ruled Milei’s decree halting university funding unconstitutional, renewing pressure over the government’s spending cuts.