Buenos Dias and Ola from the capital of Argentina, Buenos Aires. Our morning began with something new: mass cabs from the Hotel Emperador to the United States Embassy. Coordinating 8 taxis for 31 people is quite a trick. We arrived before 9 am in bright sunshine and warm temps. Long lines for visas had already queued up but we were ushered into the back door and straight through heavy security (no phones, cameras or computers) into the Embassy. John Fennerty is the economics counselor for the U.S. mission here in Buenos Aires and he was our first speaker. Mr. Fennerty discussed Argentine economics in 20 minutes which is actually impossible but he summarized the situation quite well. Argentina began the 20th century as one of the top 10 economies in the world but through decades of political mismanagement is now among the most unstable. Onerous taxation, poor fiscal management and unfriendly business policies have created a very tough economic climate where the current president governs by authoritarian decree. There is huge economic potential here but the risk is all political. Mr. David Mergen is the agricultural counselor at the Embassy and he began by summarizing Argentine agricultural export taxes. This is possibly the most illustrative example of how bad the government here treats agribusiness. Soybeans for export are taxed at 35% – right off the top. As Argentina is the world’s 3rd largest exporter of soybeans this is surely a significant revenue grab for the central government. One area where Argentina shines is education. The literacy rate here is over 97% and a highly educated population provides an excellent platform for potential economic improvement.
After a quick photo opportunity in front of the Embassy gates we boarded another set of cabs for a rush hour trip through downtown Buenos Aries to the Argentine Agriculture Ministry. Some traffic observations: lane markers and signals are treated by drivers as mere suggestions and the brake repair business must thrive here. Our host at the Ag Ministry was Lorenzo Basso, the Secretary of Agriculture for Livestock and Fisheries. Secretary Basso warmly welcomed us to Argentina and stressed the importance of shared educational ties between his country and the U.S. Alejandro Silva is the Chief of Staff for Secretary Basso and he presented Argentine agriculture statistics as well as current information from his recent trip to Brussels and discussions with the European Union. Somewhat surprising, Mr. Silva was quite clear on one major issue: Argentina is aggressively pursuing biotechnology improvements to increase grain crop yields. His position was that Europe would have to accept genetically modified crops if they wish to consume meat, as Argentina supplies them with 60% of their soybeans. Mr. Silva made the point that Argentina wishes to pursue agriculture policies based on science and reason, not misinformation and falsehoods. Mr. Silva had a friendly audience on this point and it appears the Argentines may help the United States by persuading the EU to soften their stance on biotechnology.
Another taxi caravan delivered us to the Hotel Sofitel and lunch sponsored by Rabobank. Cecelia Ordonez and Paula Savanti delivered an energetic presentation covering ag credit and banking in Argentina. One interesting fact is that Argentina and India are roughly the same land size but have vastly different sized populations. Argentina has 14 million people and India has 1 billion. What a difference in population density. Strengths of Argentina are their land size, technology base, educated population, and infrastructure. However, they have to contend with volatile macro-economic issues, a high cost of borrowing, heavy taxes, and an inconsistent legal system. Following this wonderful lunch and discussion we thanked our hosts and dispersed for an afternoon assault on the shopping and cultural destinations of Buenos Aires. The sky was bright blue with golden sunshine and a slight breeze, all making for a beautiful backdrop to explore one of the great cities of the world. We rallied back at the Hotel Emperador for our 7:45 cabs taking us to Bar Sur Tango and the evening meal sponsored by Gerry Salzman and Case IH. Buenos Aires and the tango are inseparable so a visit here is not complete without this wonderful cultural experience. The Class of 2010 thoroughly enjoyed the performance with much laughter, a little wine and many photos to remember the evening.
That’s all for now. Only two days left before we head home and our class will certainly make the most of their remaining time here.