Energy and lithium, booming sectors for foreign investment in Argentina: how much has grown

New report from Economic Commission for Latin America and the Caribbean (ECLAC) They indicated that they entered Latin America and the Caribbean throughout 2022 $224.579 million in foreign direct investment, A number representing a jump 55.2% from the previous record and the Maximum value since the stats are available.

In the region, good results are concentrated in south america which accounted for more than 80% of the turnout, and Brazil was in the lead by a large margin. in this meaning, Jos Manuel Salazar-Xirinachs, Executive Secretary of the Economic Commission for Latin America and the Caribbean pointed to “inconsistent” behavior affiliate capital income.

In addition, be sure There is no equivalence between increased investment and economic development And mark this point as one of the Central challenges facing a The slowdown of the economy. “the energy transmission and the sustainable productive development We are growth opportunitiesHe called on countries to improve the design of their policies.

According to the report, almost all Latin American and Caribbean countries received more FDI in 2022, however, the state of Brazil, which received 41% of the regional total Which appears as a fifth destination for global foreign direct investment, distancing itself from the second in the region. Mexico (17%).

However, with good performance Chile (9%), Colombia (8%), Argentina (7%) and Peru (5%) were farther away from the podium.

In case ArgentinaAnd It featured a 123% year-on-year jump in foreign direct investment that amounted to 15 billion US dollars; The behavior was similar to that of Chile (129%) and higher than that of Brazil (97%).

dynamics and expectations

The post-pandemic recovery dynamic responded however It is not clear if they will remain at similar levels in 2023. I noticed the report “Foreign Direct Investment in Latin America and the Caribbean 2023 » and stressed that, Since 2013, foreign direct investment inflows to the region have not exceeded $200,000 million.

weigh those flows into the regional GDP It also increased in 2022, to reachaccounted for 4.0%, according to the document. “he challenge To attract and retain foreign direct investment that contributes effectively to The sustainable and comprehensive productive development of the region “It’s still more modern than ever,” said Salazar Xerenakhs.

“there new opportunities In the era of reshaping global value chains and the geographical shift of production in the face of a globalization changeadded the Executive Secretary of the Economic Commission for Latin America and the Caribbean, at a press conference in Cairo Santiago de Chile.

at the regional level, 54% of foreign direct investment entered the services sectoralthough reflux also occurs in both Manufacturing and natural resources. investments in financial services; Electricity, gas and water. information and communications; Transport-related services got the largest share in the Pioneer category.

in matters reinforcementAnd United State accounted for 38% of the total and European Union 17%, Among the major investors in the regionwhile foreign direct investment from countries in the same region of Latin America and the Caribbean witnessed a significant jump, going from 9% to 14% of the total.

investment levers

From ECLAC they specify energy transmission as one of the main programs drivers of economic growthwhich could become a major driver of the region’s productive transformation, given the available resources It recommends that governments give priority in their productivity programs to activities such as: Lithium, green hydrogen, solar energy, and wind energy.

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As shown, The percentage of installed renewable energy capacity in Latin America and the Caribbean is higher than the global averageAnd The power generation matrix is ​​one of the cleanest in the world.

Therefore, if it increases its supply of renewable energy, the region could become an asset Goods production Which are produced today in countries with relatively less clean matrices.

Governments should Lead the coordination of strategies for the success of the energy transition in the region, “and stressed the committee’s document between responsibilities pointed to Ensure the drastic reduction of non-renewable energy activities as required by the climate commitmentsIn addition to mitigating its negative effects and economic and social costs, especially in terms of investment, employment and income.

for this reason, To make the transition “fast and safe” Recommend development long term policies that promote investment in renewable energy sources.

However, given the available capabilities Non-renewable sourcesThe Economic Commission for Latin America and the Caribbean warned that in this process the importance that this sector continues to have for some countries in the region should be taken into account, “particularly in terms of Income generation To meet social demands, productive development and energy security.