Annual publication on the evolution of foreign direct investment liabilities in companies in the country, in force from 2004 to 2016.

These statistics were based on the information obtained in the Survey of Direct Investments in resident companies provided by Communication A4237 and complementary ones, which was replaced by the Survey of External Assets and Liabilities established by Communication A6401 based on the information for 2017.

Executive Summary

The estimated gross passive position of foreign direct investment (FDI) in Argentine companies totaled US$ 88,249 million as of December 31, 2010, with a year-on-year increase of 10.1%.

Of this amount, US$ 65,638 million (74.3%) corresponded to the book value of investors’ shares in the net worth of companies in the Non-Financial Private Sector (NFPS) and the Private Financial Sector (SPF), and the remaining US$ 22,611 million (25.7%) corresponded to gross indebtedness of NFPS FDI companies with their parent companies and/or subsidiaries abroad.

The stock of FDI in the country at the end of 2010 represented 23.9% of the Gross Domestic Product (GDP), a value similar to most of the economies of the region.

According to the geographical origin based on the first level of direct investment holding, 53.9% of the holdings were concentrated in the European continent, 21.2% in North America, 16.1% in South America and 6.1% in Central America and the Caribbean, with the remaining 2.6% corresponding to other regions.

FDI flows throughout 2010 resulted in a positive amount of US$ 10,391 million, reaching the levels of 2008, which had marked a maximum in the series. This result was mainly due to the reinvestment of profits of US$ 5,851 million, which reached a record since the beginning of the series, followed by net capital contributions of US$ 3,137 million and US$ 2,322 million due to the net increase in debt with parent companies and foreign subsidiaries of NFPS FDI companies. These revenues were partially offset by expenditures from stock transfers of US$ 919 million.

The income generated by FDI firms registered an estimated value of US$ 12,297 million during 2010, almost 50% higher than the previous year, and 10% higher than the previous maximum obtained in 2008. The return measured on equity reached an annual value of 18.8%, with increases compared to the previous year that extended to practically all sectors of activity, reflecting the recovery in the profitability of companies.

More than 60% of FDI flows in 2010 (US$ 6,965 million) were directed to local companies that export goods. For its part, the group of FDI companies dedicated exclusively to production for the domestic market recorded revenues during 2010 of US$ 3,426 million.

The sectors that showed the highest year-on-year growth in relation to the stock of direct investments at the end of 2009 were machinery and equipment and mining (YoY increases of 44% and 40% respectively). It was followed in importance by investments in the oilseeds and cereals sector (20%) and in the automotive sector (19%).

The mining sector became the largest recipient of direct investment in 2010, reaching a record income of US$ 1,329 million, an increase of 77% over the previous year and more than 115% compared to the average flows received in previous years. This increase originated in a context of the high profitability of investments in this sector and the reinvestment of part of the profits generated.

The automotive industry, a sector whose FDI flows are generally aligned with international trade volumes, recorded net inflows of US$ 1,068 million, recovering from the net outflow of US$ 886 million observed in 2009.

At the level of the country where the investments come from, considering the first level of holdings, Brazil, with net income of US$ 1,678 million, was the main country of origin of FDI flows in 2010, and they were registered mainly in the automotive sector. Chile, with US$ 1,290 million, ranked second, with funds invested mainly in the mining sector.