Argentina is the third largest power market in Latin America after Brazil and Mexico, the ongoing reform plan to attract foreign investment to the country have restarted efforts to promote renewable energy through auction rounds in the RenovAr program. Recently with round 2 (bids for wind, solar, biomass, biogas and small-scale hydropower) on November 2017 they have offered 1,200 MW, after successfully awarding more than 2300MW in the past rounds 1 and 1.5. The government has increased the goal for the share of renewable energy in total capacity from 2% to 8% for December 2017, and the goal is to reach 20% by December 2025. These actions are a reflection of the strong growth, improving access to financing and the government’s commitment to accomplish its targets.
The year 2018 is forecasted to see a particularly strong growth (93% y-o-y) as part of the projects contracted in Argentina's renewables auctions held in 2016 start to come online.
Regarding Infrastructure, government plans to invest 6% of annual GDP in this sector as it aims to boost amount of projects involving public-private partnerships. There are more than USD 60 Billion opportunities in federal infrastructure, including water and sanitation works, land irrigation systems, 70 health and 460 educational projects which are in the pipeline for Argentine government in the short and medium term.
Transport has been set in the spotlight directly by the new government plan with USD 1.2 billion investment forecast for improvement of 17 airports, incorporating new technologies, primarily in Buenos Aires, Mendoza, Tucumán and other provinces. As a branch of infrastructure to pay special attention to, USD 425 million in investments are expected in ports aimed at capacity expansion; re-dock repairs, risk reduction and new terminal projects in several provinces. Urban mobility expects USD 4 billion investments in road repairs, viaducts, metro bus and rails in the short and medium term.
Oil & Gas
The main sector in the country by investment and revenue is the energy sector. The new administration expects USD 20 Billion annual investment opportunities in oil & gas projects, including Vaca Muerta as the second largest shale gas at the fourth largest shale oil TRR in the world. Along with this strong shale opportunities and improvements in Argentina’s fiscal regulatory environment will support increased exploration in the medium and long term.