Population

Profile of Argentina – A Fact Sheet Population Capital : : 40 Million Buenos Aires City (Population 3 Million) Cardoba (Pop: 1.5 mn; industrial centres) Mendoza (Pop:1.3 mn; wineries & minerals ) Rosario (Pop: 1 mn; agribusiness centre) Mar del Plata (Pop: 0.6 mn; beach resort) Spanish 23 provinces and Federal Capital Cordoba – Manufacturing, agribusiness, IT & educational centre Santa Fe – Agribusiness and biotechnology Mendoza – wine, oil & gas and minerals Neuquen – oil & gas Santa Cruz – oil & gas Chubut - oil & gas San Juan - Minerals Argentina Peso written as „$‟, the same as US Dollar sign, US$ 1 = 3.47 Peso (as on Feb 2009) Pleasant; no extremes. Peak Summer : December-January Peak Winter : June-July 8 ½ hours behind IST US$ 304 billion US$ 7620 2008 9% 2008 3.32 2007 10% 2007 3.15 2006 9.8% 2006 3.07 2005 12.6% 2005 2.90 2004 7.9% 2004 2.92 Other major cities : Language States Main provinces : : : Currency : Climate : Time GDP Per Capita Income Inflation : : : : Exchange Rate 1 US $ = Peso : srtepc Dossier on Argentina -1- Trade (US $ Million) Year India‟s exports India‟s imports 2008 (Jan-Nov) 418 946 2007 2006 2005 2004 2003 2002 328 290 269 154 131 85 1002 949 746 563 571 404 Major exports of India Sl.No. Items 1. Organic chemicals 2. Equipment and machinery 3. Tractors and autoparts 4. Sound and image devices 5. Synthetic fibre 6. Lubricants and special oils 7. Cotton 8. Synthetic yarn 9. Iron & Steel 10. Dyes Jan-Dec 2008 In Million US $ 123 28 27 27 27 26 17 17 16 13 Main Imports from Argentina – Jan-Nov’2008 Items Soya oil Copper Wheat Sunflower oil Leather Machinery(mainly CNG equipment) Iron & Steel Lubricants Wool US $ Mn 606 96 97 31 21 13 7 6 6 Foreign Trade (In USD Bn) Year 2008 2007 2006 2005 2004 Exports 84 55 46 40 34 Imports 45 44 34 28 21 srtepc Dossier on Argentina -2- Main Sources of Imports (2008) Country of Origin Brazil China USA Germany Mexico Italy Japan Spain US$ (BN) 15 6.2 5.6 2 1.5 1.1 1 0.9 Share (%) 32.5 13 11.7 4.3 3 2.2 2.1 1.9 Top ten imports of Argentina (2008) Products Vehicles and Auto parts Equipment and Machinery IT and other High Tech products Petroleum and Minerals Organic Chemicals Plastics Iron and Steel Products Fertilizers Pharmaceuticals Health care Products US$ in Billion 7.5 7.3 5.6 3.6 2.3 1.8 1.3 1.3 0.9 0.9 Share (%) 17 16.4 12.5 8.1 5.2 4 3 3 2.1 2 srtepc Dossier on Argentina -3- Main destinations of exports (2008) Destination Brazil China USA Chile Spain Holland Italy Germany Uruguay Venezuela Egypt Mexico Iran US$ (BN) 14.2 8.8 6.8 6 4.4 3.9 2.5 2.2 2 1.7 1.4 1.3 1.2 Share (%) 16 10 7.5 6.6 5 2.5 2.2 1.9 1.8 1.7 1.6 1.5 1.4 Top ten exports of Argentina (Jan-Dec’08)) Sl.No. 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. Items Soybean oil Copper Sunflower oil Wheat Leather Iron and steel Water pumps Coal Wool Salt and related minerals In million US $ 645 96 56 44 23 9 7 6 5 4 srtepc Dossier on Argentina -4- Overview of the Market Argentina is the third largest market of Latin America after Brazil and Mexico. It is rich in natural, mineral and energy resources. It has the eighth largest land area but a small population of 40 million. It was one of the top ten richest countries in the world before the Second World War and has the potential to regain its past glory. Argentina is a founding member of the Association for Latin American Integration (ALADI-Asociación Latinoamericana de Integración), which was created with the longterm goal of establishing a Latin American Common Market. Argentina is also member of the Common Market of the South (MERCOSUR Mercado Común del Sur), which includes Brazil, Paraguay, and Uruguay. Bolivia, Chile, Colombia, Ecuador, Peru, and Venezuela joined the pact as associate members. Venezuela was accepted as full-fledged member in July 2006, and has four years to adapt to the MERCOSUR Common External Tariff scheme. As a member of the World Trade Organization (WTO), Argentina signed the Agreement on Technical Barriers to Trade (TBT), affirming its obligations relative to technical regulations and conformity assessment procedures. Trade Issues Argentine regulatory agency ANMAT (Administration, National Drug, Food, Technology, Medical) does not allow import of finished formulations of pharmaceuticals from India. They allow only 26 selected countries, including USA, Europe, Japan and some Latin American countries. The Embassy is in touch with the Argentine government to lift this restriction. However, Argentine companies import substantial quantities of bulk drugs from India. Argentine authorities have imposed antidumping duty on import of CDs and DVDs from India and have started preliminary anti-dumping investigations on dyestuff and polyester fibres. These are being pursued appropriately. srtepc Dossier on Argentina -5- Profile of Textiles & Clothing Market   Argentina is one of the important markets for textiles and clothing with a total market size of USD 1.40 billion. Man-made textiles account for 36% of total imports, followed by cotton 19%. Other textiles imports are Apparels (13%), Industrial Fabrics (7%), Special Yarns Non-woven (5%), and others 20%. Most clothing in Argentina is sourced from Brazil, Pakistan, Indonesia, Korea, China, and Taiwan. Yarn dominates with 71% share of the total Indian MMF exports followed by Made-ups (15%), Fabrics (9%), and Fibre (5%). Argentina‟s Global Import of Textiles and Clothing in 2006: USD 1012 million. Argentina‟s Global Import of Textiles in 2006: USD 820 million. India‟s share of trade in Argentina‟s textile market in 2006: 3.42% (USD 42 million). Argentina‟s Global Import of Clothing in 2006: USD 192 million. India‟s share of trade in Argentina‟s Clothing market in 2006: 4.7% (USD 08 million). Leading sourcing centres for Argentina‟s import of Textiles.         Argentina - Textile Spinnings and Weaves, Fibers and Fabrics Market Research This research analyzes the development, present situation and prospects of the primary textile industrial sector in Argentina, composed by the production of textile spinning and weaves, natural fibers and textile fabrics. This sector has the final demand in the apparel industry and the natural fiber producers and chemical manufacturers as main suppliers. Besides it, this market research analyzes the main companies of the sector, their competitive strategies, profitability and positioning, in a high concentrated and competitive sector, whose demand has largely increased in the past years, doubling the production volumes of the last decade. Furthermore, the market research shows the marketing strategies and the market shares for the companies.The report includes an in-depth analysis of the sector, the factors influencing the market evolution and future developments. Also, it shows a comprehensive analysis on market structures, the competitive strategies followed by the main players, competitors attitudes, competitive forces, with emphasis on market srtepc Dossier on Argentina -6- and services diversification, marketing policies and strategies, positioning against main success key factors, market shares and yields. Market Challenges  MERCOSUR (Common Market of the South) gradually eliminated almost all non-tariff restrictions and other limitations to trade among its members (Argentina, Brazil, Paraguay and Uruguay). As of 2006, over 99 percent of all MERCOSUR tariff lines had been reduced to zero. Argentina and its MERCOSUR partners established a Common External Tariff (CET) on goods originating in non-member countries that currently ranges from zero to 20 percent for most products. However, some categories of goods, such as automobiles, have a CET of 35 percent. Domestic taxes (i.e. excise taxes) are levied on tobacco, alcoholic beverages, soft drinks, syrups, extracts and concentrates, television sets, tape recorders, record players, and microwave appliances, among other products. Prior government approval is required for imports of sensitive goods such as pharmaceuticals, foodstuffs, insecticides, veterinary products, medical devices, and defense materials, cosmetics and toiletries, and others. Certain types of special vehicles, publications, shoes, carpets, paper and automobiles to be used as prototypes also require prior government approval to be imported into Argentina. Many food-related and agricultural imports, such as livestock, plants, bulbs, cuttings, rhizomes, roots, grains, and plant products, require a sanitary certificate issued by a competent authority in the exporting country. Argentina continues to delay issuance of health certificates that would allow the resumption of exports of poultry meat and products from the United States. It also currently imposes anti-dumping duties on imports of U.S. polyvinyl chloride; and in 2005 imposed non-automatic import licenses on toys, requiring importers to obtain a certificate reviewed by three different offices in the Secretariat of Industry. The Argentine government requires certificate of origin on a broad range of imports generally covering but not limited to consumer goods, textiles, apparel and footwear, printing machines, and machine tools. Commercial invoices must be presented in Spanish (one original and three copies), with the caption "Original Invoice". The bill of lading should be issued (at minimum) in one negotiable copy.          srtepc Dossier on Argentina -7-  Packing lists are necessary for customs clearance in Argentina and must describe the contents of each package. A packing list is not necessary for goods imported in bulk, such as coal, petroleum, sand, etc., or for articles that have identical characteristics, composition, weight, etc. Labels of all products sold in country should be in Spanish, with the exception of foreign words/phrases of common usage in trade. Imported products may keep the original label of country/language of origin but should have a sticker/label attached to the package in Spanish. Used capital goods must be refurbished in the country of origin or the country of export. Safety regulations and mandatory certification apply to low voltage electrical equipment, toys, shoes, gas appliances and products, steel used for construction, elevators, energy consumption, appliances, closures for dangerous products, and personal protective equipment. The quota system and the special regime for auto parts imports constitute a major non-tariff barrier in the automotive industry. A Bilateral Common Automotive Industry Regime with Brazil establishes preferential market access treatment for both countries to protect the MERCOSUR automobile industry.      Market Opportunities  The zero percent import duty on a broad range of new capital goods produced in non-MERCOSUR countries, such as the United States, remained in effect till December 31, 2008. Some goods not produced within the four MERCOSUR countries (Argentina, Brazil, Paraguay, Uruguay), such as newsprint and books, and certain petroleum products also pay zero percent import duties on entering the Argentine market. Leading U.S. exports to Argentina in 2005 were Nuclear reactors, boilers, machinery, etc. and parts thereof (27%); Organic chemicals (11.3%); Electric machinery etc., Sound equipment, TV equipment and parts thereof (9.9%), and Plastics and articles thereof (5.9%). The following sectors offer the most significant growth potential for U.S. exporters: Agricultural Machinery, Equipment and Parts, Airport and Ground Support Equipment , Residential Building Materials and Supplies, Books and Periodicals , Electric Power Systems , Financial Services, Food Processing and Packaging Equipment and Parts, Information Technology, Medical Equipment and Supplies, Mining Machinery and Equipment, Pleasure Boats, Plastics srtepc Dossier on Argentina    -8- Production Machinery, Security Equipment, Telecommunication Services, Travel and Tourism Services.  The following agricultural sectors offer the most significant growth potential for U.S. exporters: Animal Genetics (Bovine Semen), Food Ingredients, and Planting Seeds. Argentina Labeling/textiles and apparel The Southern Cone Common Market (MERCOSUR)'s Common Market Group, which includes representatives from Argentina, Brazil, Paraguay and Uruguay, recently issued final technical regulations establishing labelling requirements for textile and apparel products produced in or imported for consumption into a MERCOSUR member country. These regulations were incorporated by member countries into their national legislation by 1 July 2008. Under the new labelling regulations, subject merchandise will have to include the following information in a label, stamp, decal, print or similar means that is permanent, indelible, legible and clearly visible: (i) name or registered brand and tax identification of the domestic producer or importer; (ii) country of origin; (iii) fibre content (fibres accounting for less than ten percent of the total may be listed as "other fibre(s)"); (iv) care labelling instructions; and (v) size or dimensions, as applicable. This information will have to be presented in the language of the country of consumption but could also be presented in another language(s). Certain textile and apparel articles sold in packages are allowed to bear the required information on or inside their packaging instead of on the article itself if that information can be seen from the outside. These articles include fabric diapers, handkerchiefs, napkins, bibs, hosiery and socks, gloves, garments made in rascheltype machines, crocheted bedspreads, mosquito nets and seamless products. If the package contains more than one item, the number of units and the fact that those items cannot be sold separately will have to be clearly stated. Textile products made with compact fabric obtained by overlaying carded voiles may bear the required information on their packaging. Textile and apparel products sold in airtight packages whose labelling information is not visible from the outside must include at a minimum the following information on their packaging: the fibre composition, the country of origin and the size or dimension. As regards curtains, bed linen and kitchen, table and toilet textile articles sold in packages, the required information has to be included on or inside their packaging if that information is visible from the outside. In such instances, the product's dimensions need not be included on the product itself. A range of products are excluded from the labelling requirements, including tampons and sanitary towels, disposable diapers, hair accessories, textile appliqués, sewing kits, funerary articles, protective and safety equipment, horse-riding equipment, textile srtepc Dossier on Argentina -9- articles used on animals or toys, motor vehicle seats, camping tents, lined buttons and hangers, footwear, felt hats, book covers, belts, rope, flags, badges, labels, toys, umbrellas, bags and suitcases, cleaning cloths, parachutes, textile products for rent, used clothing (the term "used clothing" must be included), scuba-diving clothing, certain tablecloths, visors, bath articles (except towels, curtains and carpets), furniture, wrist bands and fans. Economy Argentina's economy has sustained a robust recovery following the severe 2001/2002 economic crisis, with five consecutive years of over 8% real growth in gross domestic product (GDP). Argentine GDP reached U.S. $261 billion in 2007, approximately U.S. $6,630 per capita, with investment increasing an estimated 14.4% for the year and representing approximately 23% of GDP. The economic expansion created jobs, with unemployment down from over 21% in 2002 to 8.0% in the second quarter of 2008. Poverty levels also dropped. According to government statistics, 20.6% of the population in the 28 largest urban areas remained below the poverty line in the first quarter of 2008, down from over 50% in the immediate aftermath of the economic crisis. Argentina benefits from rich natural resources, a highly educated population, a globally competitive agricultural sector, and a diversified industrial base. Argentina's post-crisis move to a more flexible exchange rate regime, along with sustained global and regional growth, a boost in domestic aggregate demand via monetary, fiscal, and income distribution policies, and favorable international commodity prices and interest rate trends were catalytic factors in supporting renewed growth between 2003 and 2007. The economic resurgence also enabled the government to accumulate substantial official reserves (over $45 billion as of early November 2008) to help insulate the economy from external shocks. A higher tax burden, improved tax collection efforts, and the recovery's strong impact on tax revenues supported the government's successful efforts to maintain primary fiscal surpluses since 2003. Argentina has continued to perform well in 2008, with full year real GDP growth projected at about 7%, according to the Argentine Central Bank's consensus survey. A range of economic experts have identified challenges to sustaining high levels of economic growth in the future, including capacity constraints; the need for substantial new investment in primary infrastructure; potential energy shortages in the face of high growth and energy prices maintained by the government below international market levels. Other challenges include the increasing scarcity of skilled labor, inflation (8.5% in 2007 according to official statistics, but estimated by independent analysts to be significantly higher), and the heterodox policies employed to contain inflation. These include pressure on the private sector to limit price increases on some consumer goods, delays in the renegotiation of public service tariffs, export trade taxes, and export bans. Recent global financial turmoil and rapid declines in world commodity prices are also threats to Argentina's ability to continue its rapid rate of economic expansion. srtepc Dossier on Argentina - 10 - Argentina's exchange rate policy is based on a managed float, and the 2009 budget estimates the average exchange rate at 3.19. Market analysts have considered the peso's real exchange rate undervalued in previous years. This, along with historically high global commodity prices, helped lift export volumes and values to record levels, resulting in an $11.2 billion trade surplus in 2007. Foreign trade was approximately 39% of GDP in 2007 (up from only 11% in 1990) and plays an increasingly important role in Argentina's economic development. Exports totaled approximately 21% of GDP in 2007 (up from 14% in 2002), and key export markets included MERCOSUR (23% of exports), the EU (18%), and NAFTA countries (11%). Two-way trade in goods with the U.S. in 2007 totaled about $9.7 billion (according to both U.S. and Argentine government statistics). Total two-way trade in services in 2007 was $4.0 billion (according to the Bureau of Economic Analysis, U.S. Department of Commerce). The production of grains, cattle, and other agricultural goods continues to be the backbone of Argentina's export economy. High technology goods and services are emerging as significant export sectors. A decline in global commodity prices and slower global growth levels in the second half of 2008 is expected to reduce Argentina's trade surplus levels in the medium term. Nearly 500 U.S. companies are currently operating in Argentina, employing over 155,000 Argentine workers. U.S. investment in Argentina is concentrated in the manufacturing, information, and financial sectors. Other major sources of investment include Spain, Chile, Italy, France, Canada, Japan, and Brazil. Continuing Argentine arrears to international creditors and a large number of arbitration claims filed by foreign companies are legacies of the 2001/2002 economic crisis that remain to be resolved and adversely impact Argentina's investment climate. Outstanding debts include over $20 billion in default claims by international bondholders and between $7 billion and $8 billion owed to official creditors. President Cristina Fernandez de Kirchner announced in September 2008 that the government intends to pay debts to Paris Club creditors using Central Bank reserves. She further announced that the government would consider a proposal from private banks on the settlement with international bondholders of untendered Argentine Government debt. The Argentine economy which was growing at an average annual rate of over 8 per cent since 2003, had slowed down for the first time in 2008 to an estimated 7 per cent growth. It is expected to go down further to 4 per cent in 2009, consequent to the global financial crisis, economic recession in developed markets and the fall in demand and price for the commodities exported by Argentina. The good news is that the Argentine market has successfully withstood the storm of the global financial crisis with only moderate adverse impact. Unlike in the past when the Argentine economy went into a tailspin following external crises such as the Mexican and the Asian crises, this time Argentina has proved that it has become less vulnerable to external shocks. No Argentine financial institution went bust nor has the economy gone into recession following the global crisis. IMF, World Bank, ECLAC and global financial analysts have commended the new paradigm of the Argentine market which has become more stable, strong and resilient. srtepc Dossier on Argentina - 11 - Credit is to be given to the pragmatic macro-economic policies followed by the Government of Argentina which has sustained the growth in the last six years; the current account has been kept in surplus and it was 2.5 per cent of GDP in 2008; the external debt has been reduced from 165 billion dollars in 2004 to 135 billion in end2008. External debt as percentage of GDP has come down from 108 per cent in 2004 to 44 per cent in 2008; the share of foreign currency in external debt has been brought down to about 50 per cent of the total. The exchange rate has been stable and predictable and maintained between 3.1 and 3.3 pesos for a dollar in 2008 and there were no drastic fluctuations. The currency is expected to depreciate further in 2009 to 3.5 - 4 pesos for a dollar. And now to tackle the impact of the global financial crisis, the government has announced billions of dollars of public works as well as packages to stimulate the market. The government nationalized the private pension funds (amounting to 23 billion dollars) and the Argentine Airlines in 2008. Inflation is a cause of concern. Although official inflation figure is 9 per cent, there is a widespread consensus that it was over 20 per cent in 2008. But the government is committed to tackle this and bring it down. However, inflation may still be in double digit in 2009. The Argentine government made a breakthrough by announcing their decision to repay the 6.4 billion dollar long-pending payment due to the Paris Club. It has also expressed its willingness, in principle, to look into the issue of settlement of debt of about 20 billion dollars owed to the hold-outs who did not agree to the earlier debt settlement made in 2005. These steps have opened the way for re-entry of Argentina in the international financial market and access to foreign capital. The agricultural production in 2009 is expected to drop due to insufficient rains, disruption caused by the Farmers‟ strike and decline in international prices. Investing In Argentina Market Entry Strategy  U.S. companies typically market their products and services through an Argentine agent/representative or distributor. After analyzing the product and its uses, and defining the potential customers, U.S. companies intending to export to Argentina should identify the geographical areas where the major users of the product reside. Segmentation is key. It is increasingly difficult to establish a "typical customer", due to new consumption habits and to the dynamics of income distribution and demography.   srtepc Dossier on Argentina - 12 -  Personal relationships are fundamental when doing business in Argentina. Success requires taking the time to develop a close personal relationship with the representative, agent, or distributor. U.S. companies intent on exporting to Argentina should consider economic, demographic, and cultural characteristics that distinguish it from other Latin American countries. Marketing U.S. products and services in Argentina requires a high level of research, preparation, and involvement. Always use a professional translator, and if possible, have a native Argentine speaker, such as your agent or distributor, review any materials before using them in the Argentine market. Below are some practical tips to successfully approach Argentine consumers: o Appoint a representative or distributor o Have Spanish language capacity in firm o Furnish materials in Spanish o Have a long term outlook o Personalize your approach o Be consistent in attention to service and delivery o Provide fair credit terms o Dot your I's and cross your T's (lawyers and accountants) o Protect your trademarks o Do not take no for an answer/ frequent visits and follow-ups     Using an Agent or Distributor U.S. companies typically market their products through an Argentine agent/representative or a distributor. Distributors purchase goods directly from the manufacturer with the intent of reselling them. Consequently, they assume the risk of sales to third parties. Unlike distributors, an agent or representative (equivalent to the U.S. sales agent) acts on behalf of its principal and promotes the principal's business without actually taking title. Agents typically earn a commission or fee on sales. In contrast, distributors earn their margins on the difference between the price at which they purchase the goods for resale and the price at which they sell these goods in the market. Working with a distributor has several advantages. Distributors can provide strategic support for positioning brands in the market through advertising and promotion. Furthermore, they understand the local culture and can assist with after-sales service. This value-added service is increasingly important for customers, and contributes to a positive image of U.S. firms doing business abroad. It should be noted that some Argentine importers/distributors complain that U.S. companies are sometimes inflexible on financing options for imports and providing promotional support in the local market. When deciding upon the optimal form of representation to use, U.S. companies should consider their control over price, channel distribution network, srtepc Dossier on Argentina - 13 - policy, operational expenses, after-sales service, and potential liability under Argentine labor law. The Civil and Commercial Codes govern principal-agent relations. No special legislation has been enacted to regulate the cancellation of agency/distribution agreements, although a company could incur additional costs associated with the cancellation of an agency agreement under Argentine labor law. The contract entered with agents/distributors should specify rights and responsibilities, the exclusive or non-exclusive nature of the relationship, geographical scope, description of the product or services included, and the compensation plan. Contracts do not require a specific format and can be executed verbally. However, given the complexity of the legal and commercial environment, contracts are generally negotiated in writing through the exchange of reversal letters or via a basic instrument. If the distributor is granted exclusive representation in an area, this right must be explicitly noted. Areas may be assigned according to geography, sectors of activity (public or private sectors), transaction volumes (large companies, retailers, etc.), and transaction modes (cash segment, home sale, etc.). The agent may become an employee when any of the following requirements is fulfilled :       When he/she sells in the name of his/her employer When he/she sells at the prices and sales conditions established by the ones he/she represents (terms of sale defined by principal) When he/she receives a salary, travel allowances, fees, or any other kind of compensation When he/she usually and personally carries out his/her activity as a traveling salesperson When he/she renders his/her services within a determined geographic area When the risk of his/her operations is levied on the employer In these cases, Law 11,544 of 1929, as amended, may regulate the agent. In particular, Law 14,546 of 1958 extends Labor Law benefits to business agents. The parties may not elect foreign laws to govern the agreement. If a contract is executed abroad to avoid Argentine law, Argentine courts will not enforce it. The Civil and Commercial Codes permit a principal to cancel an agency agreement at his or her discretion. However, the terminating party may be liable for damages resulting from a wrongful cancellation. All agreements, whether for a definite or indefinite term, should include a notice of cancellation clause. Labor laws similarly require the service of a cancellation notice sometime before the actual cancellation date; otherwise, the principal may be liable to the employee for earnings that would have accrued during the notification period. In all cancellation cases, except those based on a just cause, the agent is entitled to one month's compensation for each year of service, payable in a lump sum. In addition, when a contract is terminated after one year, the agent or the distributor is entitled to compensation for the lost customers, which will amount to 25 percent of the amount corresponding to a wrongful dismissal. srtepc Dossier on Argentina - 14 - Distributors of U.S. exporters may have experienced problems in transferring funds for imports, particularly during the first months of 2002. However, financial transactions have gradually returned to normal, allowing for advance import payments and transfer of foreign exchange. Many U.S. companies have been successful exporting to Argentina during the economic crisis. Notably, many firms that have reported export success have done so because they took the time to develop a close relationship with a representative, agent, distributor, or other business partner. Relationships are key. U.S. companies should look at the long-term picture and keep in mind that current difficulties should be viewed in the context of circumstances beyond a partner's control. The U.S. Commercial Service of the U.S. Department of Commerce assists exporters in finding appropriate partners in the local market. The U.S. Commercial Service in Buenos Aires (CSBA) offers the following partner search services :  Customized Contact List : Using a variety of resources, including in-country databases and local expertise, we will prepare a customized list of Argentine companies in the sector of your choice. This list will contain company name, address, phone/fax numbers, a contact name, e-mail address, web site, and a description of the firm and products/services offered. We will provide the list within two to 10 business days from receipt of notification from the pertinent U.S. Export Assistance Center that the $250 fee has been paid. International Partner Search : We will conduct a pre-screened search to identify up to five qualified potential representatives, distributors, licensees, franchisees, or other strategic partners interested in your product or service. The preferred method for showing your products and company information to Argentine firms is your web site or electronic catalog/brochure. If a web site or electronic catalog is not available, we will require 20 sets of product literature. The cost for this service is US$500; turnaround time is 30 business days. Gold Key Matching Service : This service allows U.S. firms to efficiently and effectively travel to Buenos Aires for face-to-face meetings with potential business partners. We will prepare a customized schedule of appointments with pre-screened potential agents, distributors, or other business contacts, according to your needs. The cost for this service is $685 the first day, $320 each additional day of appointments. Six weeks advance notice is required. Video Gold Key Matching Service (VGK) : The VGK offers all the advantages of the Gold Key Service (GKS), without the expense of travel. We will arrange for pre-screened potential agents, distributors, or other business contacts to come to our offices for video meetings. The service includes at least three quality meetings with pre-screened potential Argentine firms, up to four hours of video interaction (including a briefing with Commercial Service staff). Please contact us for price and payment method.    srtepc Dossier on Argentina - 15 -  Platinum Key Service : This service is intended for U.S. firms active in a key industry sector, involved in bidding on a major project, or seeking commercial intelligence to achieve their business goals. A senior staff member will actively monitor and seek out information and intelligence in your area of interest. You will receive up-to-the-minute privileged market intelligence, trade leads, insights and major projects news or developments. These reports, via e-mail or through confidential periodical telephone or videoconferences with the Embassy Commercial Specialist, will discuss political, strategic, financial and competitive developments in your firm's sector or in any number of specific projects in Argentina. In short, you can now access the perfect tool to know --or double check-- what your foreign competitors, colleagues, customers, private and government clients are doing and how it affects your competitive position. This ongoing service is available for six months, one year, or a specified timeframe based on the mutually agreed-upon scope of work. Establishing an Office Foreign companies may carry out any single transaction. To carry on a habitual activity, a foreign company must establish a branch (sucursal) in Argentina. An individual must be appointed as the company's legal representative, but assignment of capital to the branch is not necessary. Regardless of whether they are associated with local investors, foreign investors may do business in Argentina as individuals or through corporations, branches of foreign corporations, limited liability companies, limited partnerships, general partnerships and "joint ventures". Foreign corporations often operate in Argentina through a separately incorporated subsidiary rather than through a branch, primarily to reduce their potential liability. If a branch is used, all of the foreign corporation's assets, not only its Argentine assets, may be subject to potential liability. In contrast, if an Argentine or foreign subsidiary were used, the foreign corporation's liability would generally be limited to the assets owned by that subsidiary. Corporations are set up with the approval of at least two legal or natural persons, whether Argentine or foreign. A corporation may not be a partner in a partnership. A corporation can usually be established within three to four weeks if capital is supplied only in cash. If supplied in kind, the corporation can be established within approximately two months. The estimated total incorporation cost ranges from US$350 to US$850, including statutory books and excluding both professional fees and stamp tax (1 percent of capital). A minimum of two founders, whether legal or natural persons, is required. There is no maximum limit on the number of founders. The founders of a company must report a domicile in Argentina for related proceedings. A minimum of two shareholders is required. No maximum is prescribed. The minimum initial capital required is US$4,000, except for corporations engaged in banking, insurance or related activities. If the capital is supplied in cash, at least 25 percent must be paid at incorporation, with the remainder payable in two years. If in kind, it must be fully paid at incorporation. U.S. firms considering setting up operations in Argentina are encouraged to fully investigate the tax and legal aspects of establishing a business with legal counsel before making any final decisions. srtepc Dossier on Argentina - 16 - Franchising While franchising billings reached over US$4 billion in the year 2000, after five-years of growth, it fell by 20 percent by the end of 2001 and gradually started recovering in 2003. In 2005, turnover reached over US$2.6 billion, reflecting an increase of 21.8 percent from the previous year and equivalent to 1.5 percent of GDP. As a result of the recuperating economy, franchises, particularly domestic franchises, are once again on the rise. Revenue was projected to reach approximately US$2.8 billion in 2006. While revenues have increased in local currency terms, in dollar terms they are still below 1990s market levels. At that time, the currency exchange was one Argentine peso to one U.S. dollar. During the last five years companies created different types of business partnerships, adjusted costs, and reduced the requirements to franchisees in order to adapt to real market demand and opportunities. For example, the franchising businesses that used to be rated in the medium-investment range were forced to reduce installation costs and fees. They are now rated in the medium-low to low investment range. Their reduced costs allowed several micro-entrepreneurial businesses to grow in an orderly fashion, starting with an investment as low as US$8,000. Another system that has emerged in past years is the franchise concept, which doesn‟t involve a physical outlet, entrance fees or royalties, and are a starting point for ventures in sectors such as merchandising, souvenirs, decoration supplies, keyholders, and pins among others. Development of franchising in Argentina has been uneven and shows a high level of concentration: 10-15 chains handle 36 percent of the franchises and 50 percent of the total turnover. According to the Economist Intelligence Unit, there are approximately 410 franchise brands and more than 16,000 franchise points of sale. The percentage of local franchisers has grown considerably in the past decade, now accounting for approximately 87 percent of the total number of franchisers. U.S. companies make up about 6.1 percent of the total, and Spanish and Brazilian companies each account for about 1.9 percent of the total. The peso exchange rate disadvantage vis-à-vis the dollar and scarce credit render it increasingly difficult for potential Argentine franchisees to acquire international or U.S. franchises. However, each opportunity should be evaluated on a case-by-case basis. The most popular areas for international franchisers are fast foods, foreign language training, apparel, dry cleaning, hotels, and car rental services. Local franchises have been particularly successful in ice creams, "empanada" pastries, health clubs, and education. Significant U.S. market players include Kodak Express, McDonald's, Burger King, Blockbuster, Holiday Inn, FutureKids, and the Wall Street Institute. Recent entries of companies in services such as real estate (Re-Max, Coldwell Banker) open roads for new market niches. Franchise contracts are generally protected under the Argentine Commercial Code as opposed to being governed by specific legislation. The scope of the service, commercial trade market/name, expertise, and shared production elements are covered by contractual obligations on both franchiser and franchisee. Elements of the contract srtepc Dossier on Argentina - 17 - include: the license, methods/systems or proprietary information transferred to a franchisee, the supply of needed inputs, methods of sales, and quality standards, and ultimate control by franchiser of the contract elements. Franchises have been successfully used in Argentina, but the obligations of the franchiser must be clearly delineated in the contract to avoid legal obligations associated with the operator, in case of default, bankruptcy, etc. Argentine law is unclear about franchiser obligations in case of bankruptcy or other commercial failings. Legal advice should be sought before signing contracts. Franchise contracts are generally protected under the Argentine Commercial Code as opposed to being governed by specific legislation. The scope of the service, commercial trade market/name, expertise, and shared production elements are covered by contractual obligations on both franchiser and franchisee. Elements of the contract include : the license, methods/systems or proprietary information transferred to a franchisee, the supply of needed inputs, methods of sales, and quality standards, and ultimate control by franchiser of the contract elements. Franchises have been successfully used in Argentina, but the obligations of the franchiser must be clearly delineated in the contract to avoid legal obligations associated with the operator, in case of default, bankruptcy, etc. Argentine law is unclear about franchiser obligations in case of bankruptcy or other commercial failings. Legal advice should be sought before signing contracts. Direct Marketing Due to the combination of four consecutive years of economic growth and rising consumption levels, direct marketing methods have renewed opportunities for development. For example, telemarketing has been one of the quickest growing tools for businesses to contact their clients during recent years. E-commerce is becoming a part of daily life particularly given the higher penetration of home broadband connections. While in most cases it still represents a marginal portion of total sales, ecommerce activity has grown 1000 percent since 2000 in peso terms. Credit through installments (interest free installment plans) is once again seeing positive growth. Consumption paid for by credit cards increased 45 percent in 2006. Mail order marketing is still not widespread in Argentina. Mail distribution prices remain high, while duties and other taxes to be paid on international mail order merchandise depend on the nature of the product or shipment. Obstacles that impede the development of mail orders include payment methods (the most common being credit card), and delivery, which is not clearly regulated. Other means of delivery include local messenger services. Despite increased competition during past years and growing efficiency among postal carriers to reduce costs, leading courier companies have been greatly affected by the macroeconomic situation. Employee layoffs and salary reductions have resulted as fuel costs have risen. Nevertheless, many have incorporated new services related to ebusiness development and telephone sales, and have introduced logistics centers that connect the entire country via satellite. srtepc Dossier on Argentina - 18 - Some imported products are marketed directly through cable and satellite TV programs. There are over 70 cable TV channels and cable TV penetration is estimated around 68 percent, the highest in Latin America, and similar to fixed telephone line penetration. Large and specialized retailers, such as household appliance stores, print flyers to lure consumers into their stores. Use of coupons has still not caught on as a successful marketing tool, as redemption rates are still low. Traditionally, companies that sell cosmetics, kitchenware, fragrances, and books have been most likely to utilize direct marketing tools. However, the increasing use of the Internet is enabling other firms/sectors to penetrate the market. Additionally, companies selling household consumer goods, electronic devices, merchandising, books and CDs, computer hardware, tourism services, and even cars, publish their product catalogs on-line. On-line product catalogs are an increasingly used tool for Argentine companies interested in exporting premium Argentine products (wine, leather products, polo gear and accessories, etc.). More Argentines continue to use the Internet for two main reasons. The channel expansion allows people to connect from multiple locations such as offices, cybercafes, phone booths, and education institutions. Additionally, the late positive economic scenario has contributed to increasing the number of Internet home connections, particularly broadband services, which increased 90 percent since 2005. Nearly 794,000 people use broadband services. Dial-up connections dropped by 8.6 percent, while free service connections now amount to 919,000 (an 8 percent increase). According to private surveys, the number of Internet users in Argentina reached approximately 10.3 million people in 2006, with pre-paid accounts increasing by 31.6 percent, according to the National Statistics Institute. Buenos Aires City represents 47 percent of Internet clients in Argentina. Another 23 percent is located in the Buenos Aires province and the remaining 30 percent is spread throughout the rest of the country. A study from Prince & Cooke reveals the profile of Internet users in Argentina. For example, 60 percent of users are in the middle and lower classes, with only high-school level education, since most of them are younger than 24 years old. Half of users surf the net at least once a day and Internet usage is similar for both men and women. Internet penetration in the upper classes is about 98 percent and these users spend an average of three hours per day online. Approximately 35 percent of homes in Argentina have a PC. E-commerce is growing at a 60 to 100 percent annual rate. However, actual sales via the Internet have not reached the same levels as in other countries, since still 60 percent of Internet users (about 6 million Argentines) make purchases through traditional channels after consulting the Internet. On-line sales have a higher rate of acceptance in the interior of the country, where the supply of products is limited and delivery is a growing sales tool. Joint Ventures & Licensing Argentine legislation permits the establishment of temporary associations, equivalent to "joint ventures", known as UTEs (Union Transitoria de Empresas). This is an srtepc Dossier on Argentina - 19 - association of two or more individuals or companies that contribute assets to develop or perform a particular transaction in Argentina or outside the country using Argentina as its base of operations. The UTE can also perform work or render services that are supplementary or accessory to its main purpose. UTEs (joint ventures) are not considered to be companies or legal entities in their own right. Participants may be resident businesspeople, locally constituted entities, or non-resident companies that have established a separate branch or other type of presence in Argentina. A contract must be signed and registered with the Public Commercial Registry at the Office of the Inspector General of Justice (Inspeccion General de Justicia) in the Federal Capital, or its provincial equivalent. The contract must contain the objective, term of duration, name and other specific information regarding their partners' responsibilities, financial contribution, and many other specific clauses. It must also provide for the appointment of a legal representative in charge of management. Selling to the Government Decree 472/2002 establishes that contracts in foreign currency with the public administration are to be converted to 1.40 Argentine peso for each U.S. dollar, adjustable with the Coeficiente de Estabilizacion de Referencia (CER-Reference Stabilization Ratio). Bidding on official government tenders requires a case-by-case analysis of the project and government situation. Federal government purchases are referred to as "compras y contrataciones de la Nacion". These are classified in larger categories or subsections of the expenditure budget: consumer goods (foods, textiles, office supplies, cleaning products, etc.); nonpersonal services (basic services, rentals, maintenance, cleaning services, technical and commercial services, advertising, traveling services, etc.); and fixed assets (land, buildings, facilities, equipment, books, collectibles, artwork, intangible assets, etc.). Public service contracts, petty cash purchases, contracts with foreign governments, contracts with international public law institutions or multilateral credit organizations do not fall under these categories. Decree 436/2000, called "Rules for Acquiring, Selling and Contracting Goods and Services for the National Government", establishes the rules applicable to federal government purchases. Resolution 515/2000 supplements this decree through a manual for describing such hiring of services. These and other regulations related to federal government purchases can be found at: https://www.argentinacompra.gov.ar/prod/onc/sitio/Paginas/Contenido/FrontEnd/ normativas.asp (in Spanish). This decree applies to all federal public agencies (including autonomous or decentralized institutions), but excludes federal banks. It also establishes the amounts determining the selection process. Government purchases of less than US$35,000 are affected by direct invitation to bid; no tender is published. Purchases of US$25,000 or less undergo direct purchase. Contracts under US$3,000 undergo a simplified process and are considered petty cash expenses. Purchases of under US$100,000 or less may undergo private bidding, but any purchases greater than that amount must have an open public bidding process. srtepc Dossier on Argentina - 20 - Advertising and publishing procedure terms apply regarding important contracts in main publications and Internet sites such as the National Contracting Office (ONC, www.argentinacompra.gov.ar), as well as in the Official Bulletin and publications of suppliers associations. Requirements for first-time sales to the Government depend on the type of provider. Information should be submitted in writing and in the form of a diskette. Furthermore, documents should be formatted in compliance with the regulations set by the National Contracting Office in order to be incorporated in the Supplier Information System (SIPRO) database. The National Contracting Office (Oficina Nacional de Contrataciones - ONC) is the agency supervising procurement for the National Public Administration. This Office is part of the Under Secretariat of Budgeting, Secretariat of Treasury, Ministry of Economy. Contact Information: Oficina Nacional de Contrataciones (National Contracting Office) Hipolito Yrigoyen 250, Piso 10, Of. 1001 C1086AAB Buenos Aires Phone: (54-11)-4349-6592/79. Fax: (54-11)-4349-6588. E-mail: controlmcc@sgp.gov.ar URL: www.argentinacompra.gov.ar A prominent NGO looking out for the interests of companies participating in national, provincial, and municipal procurements is the Union Argentina de Proveedores del Estado (UAPE). UAPE has a database of government procurements. More information can be found at www.uape.org.ar. Most provincial governments have their own websites with procurement information. Both the Inter-American Development Bank and the World Bank have a number of active loans in Argentina presenting procurement opportunities for U.S. companies. The U.S. Commercial Service in Buenos Aires publishes information about many of these opportunities and can sometimes assist in obtaining bidding documents. Procurement from Local Companies By Law 25551 issued on November 2001 and implemented by Decree 1600/2002 the national government established the Buy National Regime. The "Compre Trabajo Argentino" regime, affects national treatment in that it obligates all government agencies and privatized utilities to purchase domestic materials, goods and products, provided that the price is "reasonable" (precio razonable) and the performance is identical or similar (idénticas o similares prestaciones) to that of the imported/foreign goods offered, as defined by regulatory Decree 1600/2002 of August 28, 2002. Preferences:  Goods : Preference will be given to domestic goods. The origin of the goods shall be determined by the nature/composition of the goods themselves, not based on the nationality or ownership of the manufacturing company. Goods srtepc Dossier on Argentina - 21 - containing imported parts shall be considered domestically produced when the value of the imported parts is no more than 40 percent of the sales value of the finished good, or when the imported product undergoes substantial transformation in country; such that the MERCOSUR tariff classification code of the transformed item differs from that of the imported part. Services : Preference will be given to bids submitted by a domestic company or consultant. Public Works : Preference will be given to domestic materials and to domestic services (i.e., project design, management, and construction services) as defined above. Preferential Treatment : In cash payment conditions, when the cost of the domestic goods is five or seven percent higher than the cost of the imported/foreign goods, the contracting party should select the domestic goods. SMEs - seven percent; other companies - five percent. In the case of deregulated markets, the contracting party should select the domestic goods when the value quoted is equal to or lower than that of the imported/foreign goods. The above applies only when the domestic goods meet all the requirements set forth in the contracting documents and can fulfill the expected functions (idénticas o similares prestaciones). Foreign Goods : When a bidder offers to supply foreign goods not available in country, he/she must guarantee "nationalization" of the goods by depositing a bond on behalf of the contracting party. In addition, the Secretariat of Industry, Commerce and SMEs will issue a certificate verifying the value of the goods to be purchased abroad at the request of the contracting party, within 96 hours of receiving said request. To obtain the Certificate of Verification (Certificado De Verificación-CDV), the contracting party must submit a sworn statement declaring (1) that it has complied with the Compre Argentino regime, (2) the end price or value of the foreign goods, and (3) that said price or value is lower than that of domestic goods offered or that no domestic goods were offered. Disputes : Whenever the selection of imported/foreign goods is challenged, the Secretariat of Industry, Commerce and SMEs will determine whether the domestic goods offered in fact meet all the requirements set forth in the contracting documents and can fulfill the expected functions (idénticas o similares prestaciones) in the same manner as the imported/foreign goods selected. The Secretariat may request the advice of the National Institute of Industrial Technology (Instituto Nacional de Tecnología Industrial-INTI) or any other body accredited by the Argentine Accreditation Organization (Organismo Argentino de Acreditación-OAA). If the challenge fails, the challenging party pays the costs of the Secretariat's intervention; if the challenge succeeds, the bidder offering the imported/foreign goods pays the costs. Remaining provisions refer to announcement or advertisement requirements.     srtepc Dossier on Argentina - 22 - Definitions:  Reasonable Price : In cash payment conditions, when the cost of the domestic goods is five or seven percent higher than the cost of the imported/foreign goods. SMEs - seven percent; other companies - five percent. In the case of deregulated markets, a domestic good is "reasonably priced" when the value quoted is equal to or lower than that of the imported/foreign good.  Deregulated Market or Market in Competition : That which is free of tariff controls, performance controls, investment controls and/or approvals by the Federal Government. Identical or Similar Performance : The good meets all the requirements set forth in the contracting documents and can fulfill the expected functions. SMEs: Micro, Small and Medium-sized Enterprises are defined on the basis of their annual sales in Argentine pesos (excluding VAT and domestic taxes). Domestic Parts : Parts wholly produced with domestic materials or locally produced with imported raw materials, provided the composition, shape or structure of the latter is changed during the production or manufacturing process. Domestic Components or Subcomponents : (1) The value of the imported parts is no more than 40 percent of the "sales value", without VAT, of the component or subcomponent. (2) The component or subcomponent undergoes substantial transformation in country, such that the MERCOSUR tariff classification code of the transformed item differs from that of the imported part. Note: the Decree says "sales value"; the Law says "gross production value" Domestic Origin Formula: RM + I + M = X GPVRM = Cost of the imported raw material once placed in the market. I = Cost of the imported input (supplies) once placed in the market (includes components and subcomponents). M = Cost of the imported materials once placed in the market. GPV = Gross Production Value of the good. Input (insumos): The parts, components, or subcomponents that make up a good. Gross Production Value (of a domestic good) : Cost of the domestic or foreign raw material, input, or material needed to produce the good before taxes PLUS Cost of conversion (labor, services and other charges, excluding VAT) incurred by the company to produce or sell the good PLUS Financial costs (i.e., explicit and implicit interest, monetary updates, exchange differentials) derived from using capital belonging to other than the producing/selling company PLUS Prorated overhead costs PLUS The company's unit profit or mark-up. Cost of Raw Material, Input or Material : (1) In the case of goods purchased by the domestic producer, the procurement cost plus the cost of transportation to the location where the goods will be converted or incorporated into the srtepc Dossier on Argentina       - 23 - finished product. (2) In the case of goods imported by the domestic producer, the CIF cost plus import duties and taxes paid to place the good in the local market, except VAT, plus the cost of transportation to the location where the goods will be converted or incorporated into the finished product. (3) In the case of goods manufactured by the local producer, all the costs associated with the production process, including the cost of transportation to the location where the goods will be converted or incorporated into the finished product. Comparable Prices: Must include transportation costs to the location specified in the contract. Distribution & Sales Channels After analyzing the product and its uses, and defining the potential customers, U.S. companies intending to export to Argentina should identify the geographical areas where the major users of the product reside. It is important to recognize that 80 percent of the Argentine population is concentrated in urban areas, with nearly 35 percent living in Buenos Aires city and its suburbs, and almost 10 percent in the cities of Cordoba, Rosario, and Mendoza. Segmentation is key. It is increasingly difficult to establish a "typical customer", due to new consumption habits and to the dynamics of income distribution and demography. Channel selection should be based on the nature of the product and the company's knowledge of the Argentine market. Generally, firms new to this market find it more effective to sell through a distributor. Large firms generally buy directly from overseas suppliers, while smaller firms prefer to buy through intermediaries. Industrial equipment is sold by sales agents or through trade fairs, while consumer goods are increasingly sold through large outlets such as supermarkets. Argentine distribution channels have gained increased efficiency through merging and streamlining during the past decade, as a result of the increased competition and changes in the consumer buying process that require goods to be delivered at lower prices and in a timely manner. Argentines have realized the benefits of logistics management in order to be more competitive. State-of-the-art technology plays an important role in upgrading warehouses. The introduction of "paperless" warehouses by large companies has been well received due to its inherent advantages and the reduction of operating costs. Approximately 70 percent of Argentina's 1,500 warehouses and manufacturing plants are located in the Greater Buenos Aires city area. Nearly 35 percent of the population is concentrated in Greater Buenos Aires area to include the city of Buenos Aires. Distribution in Argentina tends to be radial, with all roads converging on the Port of Buenos Aires. This dates back to the turn of the century when Argentina's rail and road systems were developed by the British to bring products to the Port of Buenos Aires to satisfy the foreign demand for commodities. The hub-oriented distribution approach used in the U.S. does not exist in Argentina as of yet. There have been significant improvements in transportation infrastructure during the past decade as a result of deregulation and privatization. srtepc Dossier on Argentina - 24 - Argentina stretches 4,000 km (2,400 mi.) from north to south, an expanse crossed by only a few major highways. Argentina's 208,350 km road network carries 85 percent of domestic freight traffic. Argentina has 35,000 km (21,000 mi.) of railroads. Although rail, maritime, river and air cargo services are all improving, the popular and quite efficient trucking industry cannot afford to run into bottlenecks in a country that is experiencing increased international trade growth. In an effort to relieve some of this pressure, 29 vital national corridors, encompassing almost 10,000 km, have been privatized, with concessions for conservation and improvements of existing roads rather than construction of new ones. While tolls are comparatively high, the preexisting road conditions actually made operations much more costly. However, trucking has drawbacks as well. Trucks are not inspected regularly, and many fleets use old and poorly maintained vehicles. Almost 70 percent of Argentina‟s foreign trade is carried by ship, and about 80 percent of the import/export transactions are carried out through the ports of Buenos Aires and La Plata. The waterways on the Parana and Uruguay rivers are well dredged and maintained. These rivers link the port of Buenos Aires to internal Argentine ports, as well as to Paraguay and Brazil. Port-rail links in Argentina are generally poor. This lack of interconnectivity is the main reason why trucking services handle the bulk of all overland freight. In the late 1990s, Argentina completed the world‟s largest airport privatization program by selling concessions to 33 airports, which introduced significant upgrades. A recent terminal merging imports and exports in one single area at Ezeiza International Airport in Buenos Aires is proof of this, allowing products imported under air-routed services to benefit from this service. Terminal de Cargas Argentina (TCA) was created as a concessionary partnership established by the Argentine Government for the operation of airfreight terminals at international airports. TCA provides full logistics and storage services to all foreign cargo agents. TCA's primary business is bonded warehouse management at the major Argentine International Airports, where the company stores imported and exported cargo while their consignees perform all relevant formalities with the General Customs Administration or Dirección General de Aduanas (DGA). TCA's headquarters are located at Ezeiza International Airport. Additionally, the company has branches in Córdoba, Mendoza, Mar del Plata, and Jorge Newbery Domestic Airport, in Buenos Aires City. Air cargo imports have been growing rapidly in the last several years. U.S. exporters shipping small items to Argentina in a short time frame may want to consider the benefits of air routed or express delivery services. U.S. products imported under airrouted services correspond mainly to the following sectors: pharmaceutical products; electric power systems; computer software; computers and peripherals; telecommunications equipment; medical equipment and supplies; automotive parts and service equipment; pollution control equipment; office equipment; irrigation equipment; mining supplies; construction machinery and equipment; security equipment components; industrial chemicals. srtepc Dossier on Argentina - 25 - Express delivery has rapidly evolved following Argentina's liberalization of postal services and strong local and international competition. International courier delivery services are extremely active and most global express delivery firms have significant operations in Argentina, including FedEx, DHL, and UPS. There are two types of traditional sales channels in Argentina. One is through largescale retailers with a defined but limited share of the market. The other is through the many specialized retailers that seek to protect their niches. The food retail market is loosely separated into three categories: traditional "mom and pop" stores scattered throughout local neighborhoods, self-service mini markets and drugstores, and the supermarkets and hypermarkets. Throughout the past decade, supermarkets and hypermarkets have dominated the Argentine retailing market. (i.e. very large stores that carry products found in a supermarket as well as merchandise commonly found in a department store). Some discount stores that emerged in 1999, characterized by smaller retail space, a limited product selection, and very low prices, are reconverting into a traditional format supermarket. Consumers prefer hypermarkets and supermarkets for practicality and convenience, particularly for monthly or weekly purchases. Hypermarkets provide a selection of between 50,000 to 100,000 items and supermarkets provide between 5,000 and 15,000 items. In an effort to become more competitive, these stores are providing additional services such as film developing, dry-cleaning, and an array of new products such as toys, apparel, school supplies, and holiday decorations. A large number of mergers, acquisitions, and transfers have taken place during the last few years. This wave has impacted several industries, including apparel, housing construction, decoration materials and music. Concentration of distribution channels is expected to continue over the next few years. Social assistance and barter distribution methods appeared during the economic crisis. There are still bartering centers operating, particularly in the interior of Argentina. Selling Factors & Techniques The Argentine economy has been recovering remarkably since 2003 and as demonstrated by four years of consecutive growth. A combination of several factors is contributing to a rise in consumption, particularly influenced by real wage increases, a partial reentry of personal credit, and rising employment levels. From August 2005 to 2006, shopping mall consumption increased by 14 percent and supermarket consumption by 13 percent. Nevertheless, the increase in consumption should be seen in the context of Argentina‟s high levels of poverty, and a significant amount of this growth coming exclusively from the upper economic classes. According to the Statistics and Census Institute (INDEC), the current poverty rate is approximately 34 percent. The per capita GDP in 2006 was calculated at about US$5,250. While industrial activity, as well as consumption expanded rapidly, this expansion cycle is expected to moderate since it is predicted to have reached its peak in some industry sectors, mostly due to increased costs of production. Scarce local financing and inability to access foreign credit may limit the expansion plans of local companies. srtepc Dossier on Argentina - 26 - Some industry sectors have benefited from Argentina's devaluation through increased export competitiveness. This has presented new opportunities for U.S. companies. This information is detailed in Chapter 4: Leading Sectors for U.S. Export and Investment. For several years Argentina had the second highest GDP in Latin America and the highest in South America. Several factors that have helped Argentina attract the attention of US companies include long life expectancy, a large middle class, and a highly literate population. U.S. companies intent on exporting to Argentina should consider economic, demographic, and cultural characteristics that distinguish it from other Latin American countries. The population and economic activity are highly concentrated in the Greater Buenos Aires area. The population is of largely European descent and continues to have strong ethnic, cultural, and business ties with Europe. Consumer preferences tend to resemble those of Europeans more than those of other Latin America nationals. However, revenues are highly dependent on MERCOSUR trade, especially with Brazil, and the regional economic situation. In many sectors, European competitors of U.S. firms are already present in the market, and may be well entrenched. Nevertheless, the U.S. is Argentina's second largest trading partner after Brazil, and competes with Spain for the top investment spot. Many U.S. firms have been very successful in this market. The U.S. lifestyle and consumption habits are increasingly influential. U.S. products have a strong reputation for quality and technological innovation, however U.S. firms are sometimes viewed as lacking commitment to the market. It is important to be prepared for a competitive market environment before doing business in Argentina. As in many countries, personal relationships are fundamental when doing business in Argentina. Success requires taking the time to develop a close personal relationship with the representative, agent, or distributor. Marketing U.S. products and services in Argentina requires a higher level of research, preparation, and involvement than marketing products domestically. U.S. firms handicap themselves if their company‟s product literature labels, manuals, and other written materials are not distributed in Spanish. When preparing Spanish language materials, care should be taken to ensure the meaning is consistent for all Spanish-speaking markets in which they will be used. For example, Argentine Spanish differs from Mexican or Chilean Spanish, therefore unintended --and sometimes embarrassing-- meanings result when a translator is not familiar with variations in the language from market to market. Always use a professional translator, and if possible, have a native Argentine speaker, such as your agent or distributor, review any materials before using them in the Argentine market. Any official document to be presented before the Argentine government authorities that is not in Spanish requires attachment of an official translation into Spanish by a Sworn Public Translator (Traductor Publico), as well as certification by the Translators Association. Due to payment chain problems and virtual lack of credit as a result of the economic meltdown of 2002, price and financing terms have become more important selling srtepc Dossier on Argentina - 27 - factors than marketing. Purchases are concentrated in simple or critically needed products with a minimum marketing component. In many ways, current marketing strategies seem to resemble those favored several years prior. Numerous massive consumption companies have started or are about to relaunch old brands, product lines, glass bottles, and packaging popular in the 1980's to reduce final costs. However, Argentine end users, who have become much more demanding and knowledgeable during the past open-import decade, will still look for a balance between price, quality, and after-sales service. Some practical tips to successfully approach Argentine consumers are the following:  Appoint a representative or distributor  Have Spanish language capacity in firm  Furnish materials in Spanish  Have a long term outlook  Personalize your approach  Be consistent in attention to service and delivery  Provide fair credit terms  Dot your I's and cross your T's (lawyers and accountants)  Protect your trademarks  Do not take no for an answer/ frequent visits and follow-ups  Many fax numbers are both voice and fax lines. When sending a fax to Argentina be prepared to say: "Linea de fax, por favor", when hearing an inquiring voice answering the call. Electronic Commerce The first wave of Internet business conceived in Argentina was mainly B2C (business to consumer) activity. These sites were essentially related to information, entertainment, and small retail services. The second wave in early 2000, however, entailed development and expansion of B2B (business to business) portals. The Argentine economic collapse, accompanied by the global Internet crisis has had an enormous impact on local virtual communities, causing the shutdown of over 394 portals of the 484 that were on-line in 2000. Only 18.6 percent have survived. Leading sectors encompassing 60 percent of the Argentine dotcom activity include entertainment, information, and tourism. To a lesser degree, other sectors include financial services, health, agriculture, job search, and real estate. Argentina reportedly hosts 11 of the top 15 most visited Spanish-language sites. Approximately half of the 700 Internet start-up companies in Latin America are based in Argentina. Growth of e-business will likely continue to drive change in most industries. As technology transforms business processes, consulting firms are leading the way in setting international standards to protect electronic transactions conducted online and through wireless communications and electronic payment systems. However, there is still a generalized lack of confidence in the culture of Argentine e-consumers regarding online transactions. Although 85 percent of online retailers accept electronic transactions, only 15 percent deliver a first class electronic payment "customer experience". srtepc Dossier on Argentina - 28 - According to a Boston Consulting Group report, Latin America's top 25 sites generate over 90 percent of online sales in Mexico, Brazil, and Argentina. The top 10 hold over 70 percent, and, in Argentina and Brazil, the top three hold over 70 percent of electronic sales revenues. Trade Promotion & Advertising An important component of the marketing-mix is promotion. Companies are encouraged to visit or exhibit at local and regional trade shows, and to visit trade shows in the U.S. attended by Argentine buyers. Single Company Promotions, a trade event service offered by the U.S. Commercial Service in Buenos Aires, provides a good means for a single company to launch its product, make technical presentations, or identify and cultivate key market makers. Argentina has many advertising agencies and management consultants, but only the largest firms offer complete services. The leading agencies are members of the Argentine Association of Advertising Agencies (Asociacion Argentina de Agencias de Publicidad). Many major U.S. advertising agencies have branches or affiliates among the leading agencies. Advertising in the print media is the most widely used method, although television, cable TV, and radio advertising are highly effective and most generally aimed at the Buenos Aires market. Many daily newspapers are published in Buenos Aires city, including "Clarin", "La Nacion", and "Ambito Financiero". Industry-focused publications are an effective mechanism for advertising. Internet advertising, though in its beginning stages, is growing in popularity and use among advertising firms. The public and private sectors operate radio and television stations. Argentina has 46 television broadcasting stations, 180 relay stations, and about 1600 closed-circuit TV systems. Some eight million TV sets are in use, with a potential audience of about 21 million. Argentina has 170 AM stations and 2000 FM radio stations. Nearly 12 million radio sets are in use, with an estimated weekly listener audience of 21 million. In addition, 200 cable companies operate throughout the country. The U.S. Commercial Service Argentina (CSA) offers the services described below to assist exporters of U.S. goods and services in doing business in Argentina:  Customized Market Research : We provide customized market research for companies wishing to have specific questions answered such as: the overall marketability of a product or service; market trends and size, customary distribution and promotion practices; market entry requirements; regulations; product standards and registration; key competitors, and potential agents, distributors, or strategic partners. You have the flexibility to design your own question(s). Price is dependent on level of detail, availability of information, and time required to conduct the research. The average cost ranges from US$250$1,500, and will be quoted to the company prior to providing the service. We will normally provide the information requested in two to ten business days. Customized Contact List : Using a variety of resources, including in-country databases and local expertise, we will prepare a customized list of Argentine companies in the sector of your choice. This list will contain company name, srtepc Dossier on Argentina  - 29 - address, phone/fax numbers, a contact name, e-mail address, web site, and a description of the firm and products/services offered. We will provide the list within two to ten business days from receipt of notification from the pertinent U.S. Export Assistance Center that the $250 fee has been paid.  International Partner Search : We will conduct a pre-screened search to identify up to five qualified potential representatives, distributors, licensees, franchisees, or other strategic partners interested in your product or service. The preferred method for showing your products and company information to Argentine firms is your web site or electronic catalog/brochure. If a web site or electronic catalog is not available, we will require 20 sets of product literature. The cost for this service is US$500; turnaround time is 30 business days. Gold Key Matching Service : This service allows U.S. firms to efficiently and effectively travel to Buenos Aires for face-to-face meetings with potential business partners. We will prepare a customized schedule of appointments with pre-screened potential agents, distributors, or other business contacts, according to your needs. The cost for this service is $685 the first day, $320 each additional day of appointments. Six weeks advance notice is required. Video Gold Key Matching Service (VGK) : The VGK offers all the advantages of the Gold Key Service (GKS), without the expense of travel. We will arrange for prescreened potential agents, distributors, or other business contacts to come to our offices for video meetings. The service includes at least three quality meetings with prescreened potential Argentine firms, up to four hours of video interaction (including a briefing with Commercial Service staff). Please contact us for price and payment method. Platinum Key Service : This service is intended for U.S. firms active in a key industry sector, involved in bidding on a major project, or seeking commercial intelligence to achieve their business goals. A senior staff member will actively monitor and seek out information and intelligence in your area of interest. You will receive up-to-the-minute privileged market intelligence, trade leads, insights and major projects news or developments. These reports, via e-mail or through confidential periodical telephone or videoconferences with the Embassy Commercial Specialist, will discuss political, strategic, financial and competitive developments in your firm's sector or in any number of specific projects in Argentina. In short, you can now access the perfect tool to know --or double check-- what your foreign competitors, colleagues, customers, private and government clients are doing and how it affects your competitive position. This ongoing service is available for six months, one year, or a specified timeframe based on the mutually agreed-upon scope of work. Price will be quoted prior to initiation of service. Business Facilitation Service : CS Argentina provides low-cost logistical and administrative support to its U.S. clients to facilitate insertion in this market. srtepc Dossier on Argentina     - 30 - This may include pick-up and delivery of bid documents, single company promotions, providing information on foreign government tenders, videoconferencing facilities, courier services, invitations to targeted members of the local business community, and/or targeted commercial presentations. Price will be quoted prior to providing the service.  Payment Methods : If one would like to order any of the services described above, please provide your American Express, Discover, MasterCard, or Visa credit card information, so we may start working on your request immediately. Please indicate credit card type and number, holder name, and card expiration date. Our telephone number is 54-11-5777-4753, our fax number is 54-115777-4203; our e-mail address is Buenos.Aires.Office.Box@mail.doc.gov keep in mind that to qualify for U.S. Government assistance your product/service must have at least 51 percent U.S. content. We would appreciate your confirming that your product or service meets this requirement when ordering any of our services. In addition, we encourage you to contact the nearest U.S. Department of Commerce Export Assistance Center, where trade specialists can provide you with guidance on entering the Argentine or other international markets. Please call 1-800-USA-TRADE (1-800-872-8723) to locate the one nearest you or visit the U.S. Government Export Portal at .http://www.buyusa.gov/home/us.html. Pricing Customized services and products can still charge price premiums demanded by the high end of the population in certain geographical areas. Even though Argentina has been traditionally characterized by high prices, high costs, and relatively low competitive pressures due to highly concentrated markets, particularly during the past few years, exchange rate comparisons, relative prices and a decreased purchasing power have translated into an decline in domestic demand particularly affecting the middle and lower classes. While consumption is now on the rise triggered by expenditures by the middle high and high population classes, as well as tourists, Argentine products are more economically priced than a decade ago. A prime example, Buenos Aires, traditionally ranked as one of the most expensive cities in the world and now is one of the most inexpensive cities for tourists. Inflation for 2005 reached 12.3 percent. As a result, the government initiated a voluntary price freeze agreement asking retailers and suppliers to freeze and/or cut prices. By the end of 2006, inflation had decreased to 9.8 percent. In order to compete locally, U.S. exporters should take into account that locally manufactured products, though mostly of inferior quality, have become more competitive in terms of pricing due to reduced labor costs. Due to the peso's devaluation, imports have become almost three times more expensive since 2002. Additionally, U.S. exporters should consider that virtually no trade finance is available for potential importers, although some firms have access to offshore dollar accounts. Since foreign exchange controls have been lifted, purchases are more often made with cash upfront. srtepc Dossier on Argentina - 31 - Sales Service & Customer Support Customer service is becoming a differentiating factor when selling a product. Argentine consumers are paying increased attention to home delivery and after-sales service, emphasized by a need to repair and maintain existing equipment and machinery, rather than replacing it with new imports. Therefore, the availability of spare parts and maintenance services are particularly important for electronic equipment, while capital goods are a plus for entering and serving this market. Protecting Your Intellectual Property Argentina remains open to foreign investment. However, continuing legal uncertainties surrounding creditor, contract and property rights in Argentina, and the changing regulatory environment, have diminished the country‟s attractiveness for foreign investors, at least in the short term. The government of Argentina adheres to most treaties and international agreements on intellectual property and belongs to the World Intellectual Property Organization (WIPO) and the World Trade Organization (WTO). The Argentine Congress ratified the Uruguay Round agreements, including the provisions on intellectual property, in Law 24425 on January 5, 1995. While intellectual property protection in Argentina has improved in recent years, enforcement is uneven. This is particularly the case for pharmaceuticals, which has been a highly contentious bilateral issue. It is strongly recommended that a local attorney review any agreements before they are signed. (To have legal standing in Argentina, documents must be either written in Spanish or translated by a Sworn Public Translator. Be sure the Spanish and English versions of any document are carefully reviewed for concordance, so that both parties fully understand the content) Due Diligence Companies interested in the Argentine market should always conduct their own due diligence before entering into business ventures or other commercial arrangements. The U.S. Commercial Service in Buenos Aires has discontinued the International Company Profile (ICP) service based on availability of adequate commercial information and financial reporting at a reasonable cost from the private sector. The U.S Commercial Service in Buenos Aires does not endorse or recommend these firms, but will provide the list only to assist U.S. companies identify commercial reporting firms on Argentine companies. Temporary Entry of Materials & Personal Belongings Personal working elements such as laptop computers or other tools must be registered at Customs at the time of entry and again on departure from Argentina. Samples brought into the country by a traveling salesperson are admitted free of duty provided they have no commercial value. Otherwise, the traveler may be required to deposit a 90-day bond that is refunded when the goods leave the country. Argentina is not a party to the A.T.A. (Temporary Admission) Carnet program of the U.S. Council for International Business to import goods, display booths, and literature for display in local trade shows for subsequent re-export. The Argentine Temporary Admission Regime (TAR) allows duty free admission of goods such as commercial samples, packaging, pallets, containers, and goods for exhibits. These items must be resrtepc Dossier on Argentina - 32 - exported within the timeframe stipulated by Customs on entering the country. Many trade show organizers are able to obtain a special waiver from the Argentine government on a case-by-case basis. New tariff barriers on textile & garment imports Argentinean government has recently implemented several tariff and non-tariff measures in an effort to further protect domestic producers from foreign competition and reduce negative trade-related effects of the global financial crisis. These measures, are in addition to several restrictions imposed by Argentina since 2007, which included the renewal of minimum specific import duties through 2010, new safety and documentation requirements for various products, stepped-up customs controls and a tightening of the requirements for submitting non-automatic import licences. Among the barriers are the incerase in duties for Textile and Apparel Imports. The increase in the Most Favoured Status (MFN) duty rate for fabric, apparel, textile madeups and footwear that was agreed by the Southern Common Market (Mercosur) some time ago and implemented by Brazil in September 2007 has now been implemented. Specifically, the MFN duty rate for apparel, carpets, footwear (excluding footwear parts) and textile made-ups classified under HS Chapter 63 has been increased from 20 percent to 35 percent while the rate for virtually all fabrics has been raised from 18 percent to 26 percent, however duty on aramid fabrics will remain constant at two percent. Non-Automatic Import Licensing Requirements for Certain Apparel and Household Goods. The Ministry of Economy and Production has amended, effective from 12 November, the non-automatic licensing requirements for certain apparel by adding the following tariff items to the list of covered products, 6103.42.00, 6103.43.00, 6105.10.00, 6105.20.00, 6105.90.00, 6107.11.00, 6107.12.00, 6107.91.00, 6108.31.00, 6108.32.00, 6108.92.00, 6109.10.00, 6109.90.00, 6111.20.00 & 6111.30.00 (both except sweaters), 6112.41.00, 6115.10.14, 6115.29.20, 6115.95.00, 6115.96.00, 6203.11.00, 6203.12.00, 6203.19.00, 6203.22.00, 6203.23.00, 6203.29.10, 6203.29.90, 6203.31.00, 6203.32.00, 6203.33.00, 6203.39.00, 6203.42.00 and 6204.62.00. These apparel products were already subject to non-automatic licensing requirements: 6110.11.00, 6110.12.00, 6110.20.00, 6110.30.00, 6110.90.00. Under these 6111.10.00, 6111.20.00, 6111.30.00 and 6111.90.00 only sweaters. srtepc Dossier on Argentina - 33 - IMPORT POLICIES Tariffs Argentina‟s import tariffs range from 0 percent to 35 percent, with an average applied tariff rate of 14 percent in 2007. Argentina is a member of MERCOSUR, a customs union formed in 1991 and comprised of Argentina, Brazil, Paraguay, and Uruguay. MERCOSUR common external tariff (CET) averages 13.6 percent and ranges from 0 percent to 20 percent ad valorem, with a limited number of country-specific exceptions. Currently, Argentina maintains exceptions to the CET on capital goods (for which the CET is 14 percent but for which Argentina allows duty free entry), computing and telecommunications goods and an additional diversified group of 100 products. Tariffs may be imposed by each MERCOSUR member on products imported from outside the region which transit one or more MERCOSUR member nations before reaching their final destination. Full CET product coverage, which would result in duty free movement within MERCOSUR, was originally scheduled for implementation in 2006, but has been deferred until 2009. In 2007, Argentina imposed a specific duty safeguard on imports of recordable compact discs, which is scheduled to be phased out by May 2010. Nontariff Barriers A number of new procedures and requirements imposed by the government of Argentina in July 2007 and August 2007 could make importing U.S. products and products from third country U.S affiliates more difficult. Customs Resolution 52 restricts the ports-of-entry for numerous goods, including sensitive goods classified in 20 Harmonized Tariff Schedule (HTS) chapters (e.g. textiles, shoes, electrical machinery, metal and certain other manufactured goods, and watches). Partial limitations on ports-of-entry are applied to plastic household goods, leather cases and apparel, porcelain and ceramic tableware and ornaments, household glass goods, imitation jewelry, household appliances, pots and pans, computers, car parts, motorcycles and parts, bicycles and parts, lamps, and toys. The government of Argentina has listed products limited to certain ports-of-entry, and the ports-of-entry applicable to those products available at http://www.infoleg.gov.ar/infolegInternet/anexos/130000134999/131847/norma.htm . Depending on their country of origin, many of these products are also subject to Customs External Note 58, which revised some reference prices and set new ones on over seven thousand tariff lines. This Note expands selective, rigorous "red channel" inspection procedures (via Resolution 1907 of 2005 and amplified by Customs External Note 55 in 2007) to a broader range of goods and requires importers to provide guarantees for the difference of duties and taxes if the declared price of an import is lower than its reference price. Customs External Note 57, which the government of Argentina indicated was designed to discourage under-invoicing and fraudulent under-payment of customs duties, requires importers of any goods from designated countries which are invoiced below the reference prices to have the invoice validated by both the exporting country‟s customs agency and the appropriate srtepc Dossier on Argentina - 34 - Argentine Embassy or Consulate in that country. The government of Argentina has made the list of reference prices and applicable countries (the Annex to Customs External Note 58) available at http://www.infoleg.gov.ar/infolegInternet/anexos/130000134999/131630/notaext58-2007-sup.doc . A number of U.S. companies with operations in Argentina have expressed concern that this combination of enhanced inspection, port-of-entry restrictions, reference price measures, and consularization requirements could delay and make more costly imports from their third country affiliates. Since 2005, the government of Argentina has solicited private sector companies to negotiate and abide by sector-specific voluntary price caps aimed at limiting price increases on key components of the consumer price index (CPI), especially in the basic consumption basket. Sectors in which voluntary price accords have been negotiated include a variety of foodstuffs, personal hygiene and cleaning products, and pharmaceuticals. Gasoline and diesel fuel prices have been controlled by government pressure and government-promoted boycotts and the government has, with some exceptions, largely frozen public utility electricity, natural gas, water, and sewage taxes since 2002. Since 2005, the government of Argentina has required nonautomatic licenses on shoes, requiring certificates that are valid for only 120 days and whose issuance involves procedures that, according to the private sector, are burdensome. There is an automatic license requirement for most footwear imports; the government of Argentina says this requirement is needed for informational purposes. Some U.S. companies, however, claim it is designed to delay footwear imports. Also since 2005 the government has required non-automatic import licenses for toys. Obtaining a license requires review by three different offices in the Ministry of Economy. The process generally takes 120 days, partly due to a backlog. Once issued, the certificates are valid for 60 days. Previously high and variable specific duties on toys were reduced to a maximum 35 percent ad valorem equivalent tariff in January 2007. Argentina prohibits the import of many used capital goods. Used capital goods which can be imported are subject to a 6 percent import tariff. Some used machinery imports are allowed, but only if repaired or rebuilt. The Bilateral Automobile Pact also bans the import of used self propelled agricultural machinery, unless it is rebuilt. Imports of used clothing are prohibited through June 2010, except when donated to government or religious organizations, as established by Resolution 367 in 2005. Argentina prohibits the importation and sale of used or re-treaded tires, used or refurbished medical equipment, including imaging equipment, and used automotive parts. A fee of 0.5 percent to fund the government of Argentina‟s compilation of trade data is assessed on most imports (90 percent of all harmonized system tariff lines). srtepc Dossier on Argentina - 35 - Foreign Trade Zones/Free Ports Argentina has two types of tax-exempt trading areas: Foreign Trade Zones (FTZs), which are found throughout the country; and the more comprehensive Special Customs Area (SCA), which covers all of Tierra del Fuego Province and whose benefits apply only to already established firms. Law 24331 of 1994 establishes the FTZ regime for Argentina. Argentine law defines an FTZ as a territory outside the “general customs area” (GCA, i.e., the rest of Argentina) where neither the inflows nor outflows of exported final merchandise are subject to tariffs, non-tariff barriers, or other taxes on goods. Goods produced within a FTZ generally cannot be shipped to the GCA, unless they are capital goods not produced in the rest of the country. The labor, sanitary, ecological, safety, criminal, and financial regulations within FTZs are the same as those that prevail in the GCA. Foreign firms get national treatment in FTZs. Under the current law, the GOA may create one FTZ per province, with certain exceptions. More than one FTZ per province may be allowed in sparsely populated border regions (although this provision has not been fully utilized). Thus far, the GOA has permitted FTZs in most of the 24 Argentine provinces. The most active FTZ is in La Plata, the capital of Buenos Aires Province. Merchandise shipped from the GCA to a FTZ may receive export incentive benefits, if applicable, only after the goods are exported from the FTZ to a third country destination. Merchandise shipped from the GCA to a FTZ and later exported to another country is not exempt from export taxes. Any value added in FTZs and reexports from FTZ is exempt from export taxes. Law 19640, passed in 1972, codifies the Special Customs Area (SCA) rules for Argentina. Unlike FTZ-manufactured goods, products manufactured in an SCA may enter the GCA free from taxes or tariffs. In addition, the government may enact special regulations that exempt products shipped through an SCA (but not manufactured therein) from all forms of taxation except excise taxes. The SCA program provides benefits for established companies that meet specific production and employment objectives. The SCA program applies only to Tierra del Fuego Province. The government reduced some SCA benefits in the early 1990s. Some of these benefits were later reestablished, but only for those firms previously established in Tierra del Fuego Province. The SCA program is scheduled to expire at the end of 2013. In late 2006, Economic Ministry Resolution 776 abolished export tax exemption enjoyed by oil companies operating in Tierra del Fuego Province. srtepc Dossier on Argentina - 36 - CUSTOMS IN ARGENTINA Taxes : All persons must pay an airport tax of US 20 $ when leaving the country. Corporate Tax Rates The tax rate for corporations is 35%. For other partnerships, the tax is charged to each partner according to a progressive tax rate scale ranging from 9% to 35% depending on the amount of the taxable income. Personal Income Tax Rates Resident individuals in Argentina are liable for income tax at progressive rates on their worldwide income. Rates range from 9 to 35 percent. Value Added Tax (VAT) and other relevant taxes for businesses The standard VAT rate is 21%. Capital goods, public transport, bovine meat, fresh vegetables, lodgings, interest on loans received from argentine financial institutions, property plant and equipment included in a list provided, newspapers and magazines, transportation for individuals are taxed at the rate of 10.5%. Exports are exempt from VAT. Tax on turnover is levied by each province. It applies to every commercial deal (sales, rents, services, royalties, interests). The rate of this tax varies depending on the concerned sector of activities. Tax treaty with U.S. Argentina has no tax treaties with the U.S. Transportation : Generally at the airport exits you will find services of buses, taxis or special taxis or remisse, which will take you to your hotel or in the case of the buses, to the centre of the city. The remisse, are a species of taxi in which the tariffs have been established previously, and in case of the Airport Ezeiza, they can be hired inside the airport in special stalls established for this purpose. The microbuses of public transport have fixed departure schedules, they are quite economic, but they realize multiple stops, for which the trip the Ezeiza Airport to the centre of Buenos Aires can take approximately 2 hours. It is also possible to hire the service of private buses or shuttle buses, at the airport itself or for the return in the hotel at which you stay, this service turns out to be more economic than a taxi, and much more comfortable and rapid than a regular bus. Customs : It is prohibited to enter the country with plants, vegetables, fruits and perishable food. You will be able to enter with domestic animals, whenever these are provided with a valid up to date owner‟s card and certificate of vaccination. You are allowed to enter Argentina with 2 liters of alcoholic drinks, 400 cigarrettes and 50 cigars. srtepc Dossier on Argentina - 37 - If you bring a car, or if you are going to rent one, you will need an International Driver‟s licence. If you do not bring one, you can get one through the Dirección Nacional de Tránsito, Av. Coronel Roca 5252, office hours between 7 to 13 hours, showing the following documents: an ID and a certificate of transitory domicile in the Federal Capital. Duty-free products : The following products can be imported to Argentina without the need to pass through customs: 1. Passengers above 18 years of age, with nationalities belonging to the following countries: Bolivia, Brazil, Chile, Paraguay or Uruguay, or residents who return to Argentina after having spent less than one year in those countries: 200 cigarrettes and 25 cigars; 1 liter of 2 kg of perishable foods for a value of USD 150 (if they arrive by land) and for a value of USD 200 (if they arrive by air or sea). 2. Passengers above 18 years of age with nationalities others than the abovementioned one or residents who return to Argentina after having stayed less than one year in thoise countries 400 cigarrettes and 50 cigars; 2 liters of alcohol; 5 kg of perishable foods for a value of USD 300. Prohibited Articles : Animals and birds from Africa or Asia (excepting Japan) without previous authorization and fresh food, especially meats, milk products and fruits. Also forbidden are explosives, flammable products, narcotics articles and pornographic materials. Warning : Any gold must be declared. It is recommended to have ready the needed customs declarations and documents for articles of value (cameras, computers, etc.) in order to avoid any problems. Requisites when leaving the country : The visitors proceeding from non neighbouring countries remain exempt from any tax on travel items and new articles of a value not superior to USD 300 and an additional USD 300 worth if acquired in the tax free shops to be found within the country. Refund of Taxes : At the airport you will be able to recover 21 % of the amount paid by way of the Value-added tax (VAT), if you have acquired national products for amounts superior to USD 70 (with invoice) in the shops subscribed to this system (that possess in their shop windows the logo here shown). The process is managed by Global Refund, world leader in services of refunding of taxes. The benefits of the system are granted in all the places adhered to the same, which are identified because they exhibit in their shop windows the Global Logo Refund. When the tourist makes a parchase, it is necessary to request the seller to hand over a check of refund in addition to the corresponding invoice. Before the tourist leaves for his country, he will have to ask customs to validate the seal on the check. The ways of receiving the refund of the tax are the following ones: to receive it in cash, to credit it to your credit srtepc Dossier on Argentina - 38 - card, to receive a check at your home address or ask for a refund in one of the Refund offices the company Global Refund has in different parts of the world. Visa Requirements U.S. citizens do not need a visa for visits of up to 90 days for tourism and business. A valid passport is required for U.S. citizens to enter Argentina. U.S. citizens who arrive in Argentina with expired or damaged passports may be refused entry and returned to the United States at their own expense. Visit the Embassy of Argentina‟s web site at http://www.embassyofargentina.us/ for the most current visa information. Import duties As a member of MEROSUR, the common external tariff (CET) does not concern all the products : only 75% of the tariff items benefit from a single rate. The sectors still out of the system for these 4 countries are: capital, information technology, telecommunications, motorcars and sugar. Besides, there are a certain number of sensitive products that are also exempted from this single rate depending on the countries (about 300 products for Argentina). The CET should be completely set up by 2006, with the following structure: - 0 % to 14 % for capital goods - 16 % to 20 % for textiles, clothing items, and consumer goods - 10 % to 15 % for the metal industry - 12 % to 16 % for farm products, data processing system and telecommunications All imported goods are subject to an ad valorem duty that is based on the cost of the goods, plus insurance and freight (CIF).However, it is necessary to take this customs policy with caution, since these countries apply more or less the recommendations of the central organization according to their own economic condition. The statistical import tax is 0.5% on the CIF value of the goods. srtepc Dossier on Argentina - 39 - General Import Clearance Information FedEx Clearance : Working with Customs officials throughout the world, FedEx has developed innovative technology to eliminate many steps of the paperwork-handling process and expedite the movement of international shipments. An example in Argentina is the FedEx Expressclear Electronic Customs clearance system. Starting at the origin location, state-of-the-art technology allows the processing of shipment paperwork and electronic transmission of documents to the designated FedEx hub and destination clearance location. The Expressclear system also keeps a database of regulatory information, which includes; importers' numbers, broker designations, corporate contact names and telephone numbers. At a FedEx hub, international shipments are sorted, scanned and loaded onto an international flight. Vital shipment information is keyed into a worldwide manifest database, which is linked to computer systems operated by brokers and Customs officials in many countries. Even before the plane has taken off, or while it is in the air, Customs agents and brokers at the destination airport of entry can begin examining shipping manifests, querying air waybill data if they need more details, assessing duties and taxes and selecting the shipments they wish to examine. By the time the plane arrives at its destination, many packages have already been cleared by Customs. As the plane is unloaded, the Expressclear system identifies packages to be examined and prints "cleared" Customs labels for all others. Cleared shipments are transferred to trucks for immediate delivery. International shipments are scanned at all key points throughout the process and this allows for up-to-date status reports including when Customs clearance is obtained. Customs Clearance : In Argentina the Bureau of Customs is the governmental agency charged with the enforcement of the tariff and Customs laws and regulations. Importation of goods into Argentina is governed by a myriad of import regulations, which are not much different from those prescribed in other countries. These regulations and documentation requirements must be observed and complied with by shippers and consignees as well as air carriers to expedite the Customs clearance of imported goods. In general, all articles imported into Argentina are subject to Customs duty and/or internal revenue taxes and enter through a customhouse at a port or airport where Customs examination, tariff classification and appraisals are made. Taxes and other charges due shall be paid (or secured for payment) prior to release from Customs custody. All importations are entered under Informal Entry or Formal Entry except the following, which may be entered duty and tax- free: 1. Importations for the official use of foreign embassies, legations and other agencies of foreign governments 2. Importations for the personal and family use of the members and attaches of foreign embassies srtepc Dossier on Argentina - 40 - 3. Miscellaneous articles that are exempt by law or process Decree 161/99 and Resolution AFIP 503/99 established a Simplified Importation System and to import merchandise under this optional clearance method. It must not be over 50 kgs as maximum weight. Under the AFIP General Resolution 1811, dated 01/11/2005, the FOB value must not exceed the sum of $1,000 USD per day. Goods that are entered under this system must:  Be new, unused and not require reconditioning  Not be prohibited for import, nor be subject to quotas or be regulated under other agencies  Not be protected by a regulation that implies any type of exemption or tariff preferences Document Requirements Air Waybill - An air waybill or carriers certificate (naming the consignee for customs purposes) as evidence of the consignee's right to make entry. Commercial Invoice - Required for all non-document shipments to help prevent clearance delays. It should be presented in Spanish, however if in English, the Spanish translation should appear right below the English text. Packing List - Required for most goods and should preferably be in Spanish. The import of some goods in bulk form (i.e. coal, sand etc.) do not require this document. Certificate of Origin - A Certificate of Origin is required by the Government of Argentina for certain products such as textiles and footwear as well as for products and parts produced in countries that are not members of the World Trade Organization (WTO). Additional documentation is required in the form of permits, licenses or product certification for goods such as (and not limited to) food, pharmaceuticals, chemical products, cosmetics, agricultural products, textiles and defense material. Customs Valuation : All goods shipped to Argentina must have a value and description. The value is usually based on the transaction value between the shipper and the importer, what the sale value of the goods were. If no actual transaction has taken place, such as with samples or a no charge shipment, a value must still be assessed; this would be the fair market value or replacement value. Non-tangible items such as a business documents, accounting documents, etc. must also be assessed a value, but this should be based on the value of the paper. Antidumping : Customs will assess antidumping duties on imported goods sold in Argentina at less that the normal price of the goods in the manufacturer's home market (also called fair market value). Specific information regarding commodities that are subject to anti-dumping duties can be found at the Comision Nacional de Comercio Exterior website at http://www.mecon.gov.ar/cnce/ srtepc Dossier on Argentina - 41 - Excise Duties : Alcoholic beverages, tobacco, soft drinks, syrups, extracts, concentrates and consumer electronic products are subject to luxury and excise taxes. Additional Duties : Countervailing duties are assessed to some goods to counter the effects of subsidies provided by the foreign government for goods exported to Argentina resulting in artificially low prices that have a detrimental impact on Argentine industries. Specific information regarding commodities that are subject to countervailing duties can be found at the Comision Nacional de Comercio Exterior website at http://www.mecon.gov.ar/cnce/ Import Taxes : In addition to the tariffs, imported goods are subject to additional fees and taxes such as :  0.5 percent statistics fee on the CIF value (except capital goods). This tax is not  levied on trade between MERCOSUR member countries.  Depending on the product, either 21 or 10.5 percent value added tax (VAT) on the sum of the CIF value, tariff and statistics fee.  Depending on the product, either 10 or 5.5 percent advanced VAT on the sum of the CIF value and statistics fee on all goods imported for resale (goods imported by the end-user are exempt).  3 percent anticipated profits tax on all retail goods (goods imported by the enduser are exempt). Customs Fees : A $10.00 USD single fixed customs fee is assessed per transaction entered using the Sistema Informatico Maria (SIM). Merchandise imported using the Simplified Import System is exempt from this fee. Exchange Controls : Exchange controls are currently imposed by the government of Argentina. Consular Fees : Legalization of shipping documents is generally not required as a condition of entry of goods into Argentina. Inspection : Minimum import prices replaced the pre-shipment inspection requirement in its entirety on December 25, 2001 under Resolution 1004/2001. Registration Requirements : Companies wishing to import products into Argentina must be registered in the National Registry of Importers and Exporters. Companies wishing to import through an optional customs clearance method established by Decree 161/99 and Resolution AFIP 503/99 called the "Simplified Importation System" must provide the the companies tax payer number known as the Clave Unica de Identification Tributaria [CUIT]. Commercial shipments consigned to, or shipped from [when exporting from Argentina] private individuals must provide the Clave Unica de Identification Laboral [CUIL] number. srtepc Dossier on Argentina - 42 - Argentina Import Prohibitions The following commodities are prohibited into Argentina:  o o o o o o o      Used products such as (and not limited to): Spare parts Medical supplies Automobiles Motorcycles and Velocipedes Clothing Tires Boats Dangerous residues (chemicals) Certain toxic substances contained in pharmaceutical products, cosmetics and toys Certain food additives and colorants Products containing polychlorinated biphenyl's (PCB's) Asbestos fibers of the Amphibole and Chrysotile variety (Crocidolite, Amosite, Actinolite, Antofilite and Trimolite) and products containing these fibers. General Import Restrictions The following items are not acceptable for carriage to any international destinations unless otherwise indicated. (Additional restrictions may apply depending on destination. Various regulatory clearances in addition to customs clearance may be required for certain commodities, thereby extending the transit time.)  APO/FPO addresses.  C.O.D. shipments.  Human corpses, human organs or body parts, human and animal embryos, or cremated or disinterred human remains.  Explosives (Class 1.4 explosives are acceptable for carriage to Canada, Germany, Japan, Sweden, United Arab Emirates and United Kingdom. Note: United Arab Emirates only allows Class 1.4 explosives to be shipped hold- forpick-up to the FedEx Express facility in Dubai.)  Firearms, weaponry, and their parts (acceptable between the U.S. and Puerto Rico).  Perishable foodstuffs and foods and beverages requiring refrigeration or other environmental control.  Live animals (including insects) except via our Live Animal Desk (1.800.405.9052).  Plants and plant material, including cut flowers (cut flowers are acceptable from the U.S. to selected points in Canada and from Colombia, Ecuador and the Netherlands to the U.S.).  Lottery tickets and gambling devices where prohibited by local, state, provincial or national law.  Money (coins, cash, currency, paper money and negotiable instruments srtepc Dossier on Argentina - 43 -             equivalent to cash such as endorsed stocks, bonds and cash letters). Collectible coins and stamps. Pornographic and/or obscene material. Hazardous waste, including, but not limited to, used hypodermic needles or syringes or other medical waste. Shipments that may cause damage to, or delay of, equipment, personnel or other shipments. Shipments that require us to obtain any special license or permit for transportation, importation or exportation. Shipments whose carriage, importation or exportation is prohibited by any law, statute or regulation. Shipments with a declared value for customs in excess of that permitted for a specific destination. Dangerous goods except as permitted under the Dangerous Goods section of these terms and conditions. Processed or unprocessed dead animals, including insects and pets. Taxidermy-finished hunting trophies or completely processed (dried) specimens of whole animals or parts of animals are acceptable for shipment into the U.S. Packages that are wet, leaking or emit an odor of any kind. Wildlife products that require U.S. Fish and Wildlife Service export clearance by FedEx prior to exportation from the U.S. Shipments* being processed under: - Duty drawback claims unless advance arrangements are made. - Temporary Import Bonds - acceptable under the FedEx International Broker -- Select option, for initial import only. - U.S. State Department licenses. - Carnets. - U.S. Drug Enforcement Administration export permit. - Shipments destined to or being withdrawn from a Foreign Trade Zone. - Letters of Credit (however, shipments covered by a Letter of Credit calling for a "Courier Receipt" as defined by Article 25 of UCP 600 may move via FedEx International Priority). - Certificate of Registration shipments (CF4455). - Shipments moving into or out of Foreign Trade Zones or bonded warehouses. *You may be able to ship these items via FedEx International Premium, FedEx International Express Freight (IXF), FedEx International Airport-to-Airport (ATA) or FedEx International Controlled Export. For information on FedEx International Premium, IXF and ITA, call FedEx Express Freight Services at 1.800.332.0807. For information on FedEx International Controlled Export, call International Customer Service at 1.800.247.4747or your local FedEx customer service representative. srtepc Dossier on Argentina - 44 - Argentina Restrictions Currently the Government of Argentina imposes quotas for the importation of peaches, white glasses for corrective spectacles, automobile parts, paper, pulp and footwear. Pharmaceuticals, chemical products, insecticides, veterinary products, medical devices, cosmetics, agricultural products, textiles and defense material require various approval prior to import from various regulatory agencies. The following commodities are prohibited via FedEx International Priority (IP) services into Argentina. However, you may be able to use another FedEx service for shipping these items. For additional shipping options, please contact your local FedEx customer service representative.  Airline tickets, blank stock  Antiques  Bearer bonds  Collectable coins  Blank credit cards  Credit cards, other than telephone cards  Firearms, parts  Poisons (toxics)  Non-negotiable stocks  Blue ice  Radioactive and explosive material General Export Clearance Information Clearance Process : Exporting from Argentina requires knowledge of the commodity, the proper documentation and export compliance. The value of the goods, destination of the shipment and if the goods are controlled, prohibited or regulated will determine the specific export requirements. Export Duties : Commodities exported from Argentina are subject to duties, which range from 5% to 20% (they vary per product type) of the FOB value of the commodity. Embargoed Countries : Argentina has been a member state of the United Nations since October 24, 1945, and as such honors any import or export sanctions imposed against designated countries under the United Nations Act 1946. Registration requirements : Exporters should be registered with the Department of Trade and Industry (DTI) or the Securities and Exchange Commission (SEC): with the city or the municipality where the business will operate, as well as with the Bureau of Internal revenue. Document Requirements : Export documentation requirements vary on the type of srtepc Dossier on Argentina - 45 - goods being exported. Goods that are controlled or restricted for export may require licenses or specific certifications in addition to an air waybill and commercial invoice. Argentina Export Prohibitions The following commodities are prohibited out of Argentina:  Logs  Certain works of art  Certain products of endangered species General Export Restrictions The following items are not acceptable for carriage to any international destinations unless otherwise indicated. (Additional restrictions may apply depending on destination. Various regulatory clearances in addition to customs clearance may be required for certain commodities, thereby extending the transit time.)  APO/FPO addresses.  C.O.D. shipments.  Human corpses, human organs or body parts, human and animal embryos, or cremated or disinterred human remains.  Explosives (Class 1.4 explosives are acceptable for carriage to Canada, Germany, Japan, Sweden, United Arab Emirates and United Kingdom. Note: United Arab Emirates only allows Class 1.4 explosives to be shipped hold- for- pick-up to the FedEx Express facility in Dubai.)  Firearms, weaponry, and their parts (acceptable between the U.S. and Puerto Rico).  Perishable foodstuffs and foods and beverages requiring refrigeration or other environmental control.  Live animals (including insects) except via our Live Animal Desk (1.800.405.9052).  Plants and plant material, including cut flowers (cut flowers are acceptable from the U.S. to selected points in Canada and from Colombia, Ecuador and the Netherlands to the U.S.).  Lottery tickets and gambling devices where prohibited by local, state, provincial or national law.  Money (coins, cash, currency, paper money and negotiable instruments equivalent to cash such as endorsed stocks, bonds and cash letters).  Collectible coins and stamps.  Pornographic and/or obscene material.  Hazardous waste, including, but not limited to, used hypodermic needles or syringes or other medical waste.  Shipments that may cause damage to, or delay of, equipment, personnel or other shipments.  Shipments that require us to obtain any special license or permit for transportation, importation or exportation.  Shipments whose carriage, importation or exportation is prohibited by any law, statute or regulation.  Shipments with a declared value for customs in excess of that permitted srtepc Dossier on Argentina - 46 -      for a specific destination. Dangerous goods except as permitted under the Dangerous Goods section of these terms and conditions. Processed or unprocessed dead animals, including insects and pets. Taxidermy-finished hunting trophies or completely processed (dried) specimens of whole animals or parts of animals are acceptable for shipment into the U.S. Packages that are wet, leaking or emit an odor of any kind. Wildlife products that require U.S. Fish and Wildlife Service export clearance by FedEx prior to exportation from the U.S. Shipments* being processed under: - Duty drawback claims unless advance arrangements are made. - Temporary Import Bonds - acceptable under the FedEx International Broker Select option, for initial import only. - U.S. State Department licenses. - Carnets. - U.S. Drug Enforcement Administration export permit. - Shipments destined to or being withdrawn from a Foreign Trade Zone. - Letters of Credit (however, shipments covered by a Letter of Credit calling for a "Courier Receipt" as defined by Article 25 of UCP 600 may move via FedEx International Priority). - Certificate of Registration shipments (CF4455). - Shipments moving into or out of Foreign Trade Zones or bonded warehouses. *You may be able to ship these items via FedEx International Premium, FedEx International Express Freight (IXF), FedEx International Airport-to-Airport (ATA) or FedEx International Controlled Export. For information on FedEx International Premium, IXF and ITA, call FedEx Express Freight Services at 1.800.332.0807. For information on FedEx International Controlled Export, call International Customer Service at 1.800.247.4747 or your local FedEx customer service representative. Technical Barriers to Trade (TBT's) Technical barriers or non-tariff barriers to trade, as they are sometimes known as, can cause many problems for exporters looking for new markets for their products. These barriers can be in the form of regulations, standards, testing and certification procedures. The World Trade Organization (WTO) Agreement on Technical Barriers to Trade tries to ensure that these barriers do not create unnecessary obstacles. To obtain further information on Technical Barriers to Trade as well as Notifications on technical regulations and conformity assessment procedures, go to the WTO website at http://www.wto.org/english/tratop_e/tbt_e/tbt_e.htm srtepc Dossier on Argentina - 47 - Free Trade Zones Argentine Law authorizes the Federal Government to create one Free Trade Zone (FTZ) in each province and it delegates to the executive branch the authority to create the foreign trade or export processing zones. There are currently 10 FTZ's in Argentina:  La Plate Free Trade Zone (ZFLP)  San Luis Free Trade Zone  Cordoba Free Trade Zone  Tucuman Free Trade Zone  Mendoza Free Trade Zone  Santa Fe Free Trade Zone  Comodoro Rivadavia Free Trade Zone  Salta Free Trade Zone  Misiones Free Trade Zone  La Pampa Free Trade Zone In addition to the free trade zones, Tierra del Fuego has a Special Customs Area regime, which allows duty-free entry of cap goods not produced in Argentina with an end use in designated high-priority industry as well as for assembly in local plants and sale in Argentina. Other imports through this area receive a 50 percent reduction on normal tariff rates. This area will continue to function until 2013 for non-bloc goods. Personal Effects : Personal working items such as computers or tools of the trade must be registered with customs at the time of entry and again upon departure from Argentina. Samples : Samples sent by parcel post or in other ways are treated the same as any other commercial shipment and have the same documentary requirements. The services of customhouse brokers are generally not necessary to clear shipments of samples with or without value. Samples valued less than CIF 100 USD are free of duties and taxes. The commercial invoice should clearly state that the goods have "no commercial value" if they qualify as such. Gifts : Articles imported as gifts may be subject to duties and taxes (donations to duly registered relief organizations may enter free of duties and taxes when accompanied by a Certificado de Donacion obtained from the Argentine Consulate prior to shipping). Standards : Argentina has a national system for standards, certification and accreditation for the stated purpose of promoting the quality of goods and services in an industrial, modern economy with global markets. As a member of the World Trade Organization (WTO), it abides the use of international standards to the maximum extent possible. Standards are developed by the Instituto Argentino de Normalizacion (IRAM), patterned after various European countries (many are compatible with U.S. srtepc Dossier on Argentina - 48 - standards), and are voluntary (where the buyer and seller determine which product standard is applicable). Country of Origin Marking : The general rules for marking the country of origin are as follows: "if any marking appears on the article itself, the country of origin must also appear in a visible place. If the wrapper or principal label on the article is too small for other marks to appear on it, showing the country of origin in a visible place on the container is sufficient. If, however, the principal label is too small to bear an indication of the country of origin, the required indication may be shown on a supplementary label attached to the container on the same side as the principal label." All non-packaged products sold in Argentina are required to have the following information on a printed label: the name/description of the product, the country of origin and the quality, purity or blending description. If the products are packaged, they should also list the net weight using the metric system. While labels should be in Spanish, it is acceptable to have a sticker or label attached to the original label with the required data in Spanish. More detailed labeling requirements exist for various items such as: medical goods, hazardous materials, food, beverages, textile and apparel and footwear and it is recommended to contact the government regulatory bodies for each industry to obtain more commodity specific labeling information. Trade Group Member Free trade agreements to which Argentina is a member to include: Generalized System of Preferences (GSP) : This system of preferences helps developing countries improve financially and economically through exports to certain developed countries by providing duty-free status to numerous products that would normally not be. MERCOSUR : This agreement calls for a gradual elimination of tariffs on goods originating in and traded among member states, and the formation of a Common External Tariff (CET). Additionally, Argentina is a participant to: The Cartagena Agreement whose aim is to strengthen integration not only in terms of trade, but also in other spheres such as the political, social, scientific, technological and cultural areas. (This agreement has led to the signing of four crucial conventions in connection with social and cultural policies) The Free Trade Area of the Americas (FTAA) whose effort is to unite the economies of the Western Hemisphere into a single free trade agreement where barriers to trade and investment will be progressively eliminated, and to complete negotiations for the agreement by 2005. srtepc Dossier on Argentina - 49 - Multilateral organizations Argentina is a member to include the United Nations (founding member) and numerous UN agencies such as the Food and Agricultural Organization (FAO), United Nations Educational, Scientific and Cultural Organization (UNESCO), United Nations Conference on Trade and Development (UNCTAD), United Nations Industrial Development Organization (UNIDO), the World Trade Organization (WTO), the International Monetary Fund (IMF), International Finance Corporation (IFC), International Fund for Agricultural Development (IFAD), International Atomic Energy Agency (IAEA), International Civil Aviation Organization (ICAO), International Maritime Organization (IMO), International Telecommunication Union (ITU), World Health Organization (WHO), World Intellectual Property Organization (WIPO), World Customs Organization (WCO) and the World Meteorological Organization. Hemispheric and regional organizations include the Organization of American States (OAS), Inter-American Development Bank (IDB), Latin-American Economic System (LAES), Economic Commission for Latin America and the Caribbean (ECLAC), LatinAmerican Integration Association (LAIA), Agency for the Prohibition of Nuclear Weapons in Latin America and the Caribbean (OPANAL). Environmental agreements honored include:  The Antarctic Treaty  The Protocol on Environmental Protection to the Antarctic Treaty  The Convention on Biological Diversity  The United Nations Framework Convention on Climate Change  The Kyoto Protocol to the United Nations Framework Convention on Climate Change  The United Nations Convention to Combat Desertification in Those Countries Experiencing Serious Drought and/or Desertification, Particularly in Africa  The Convention on the International Trade in Endangered Species of Wild Flora and Fauna (CITES)  The Basel Convention on the Control of Transboundary Movements of Hazardous Wastes and Their Disposal  The Treaty Banning Nuclear Weapon Tests in the Atmosphere, in Outer Space, and Under Water  The Montreal Protocol on Substances That Deplete the Ozone Layer  The Protocol of 1978 Relating to the International Convention for the Prevention of Pollution From Ships, 1973 (MARPOL)  The Convention on Wetlands of International Importance Especially as Waterfowl Habitat (Ramsar)  The International Convention for the Regulation of Whaling srtepc Dossier on Argentina - 50 - MERCOSUR MERCOSUR consists of Brazil, Argentina, Uruguay and Paraguay. Venezuela joined Mercosur in 2005 as a special member. It is expected to become a full member soon. Bolivia and Ecuador have also applied for full membership of Mercosur. This has been agreed in principle but the details are under negotiation. Chile, Bolivia and Peru are associate members. MERCOSUR was formed in 1991 with the objective of free movement of goods, services, capital and people and it became a customs union in January 1995. It is now pursuing the third stage of its integration „Common Market‟. Intra-Mercosur trade is duty-free while there is Common External Tariff (CET) for imports from other countries. The average CET is 14 percent and it ranges from 0 to 20 percent. CEP has 800 exceptions including cars and sugar. The Customs Union does not function perfectly and there are disputes from time to time. MERCOSUR has become a successful regional market of 240 million people with a GDP of 1.4 trillion dollars. It is the third largest integrated market after EU and NAFTA. Its external trade was 530 billion dollars in 2008. Mercosur‟s role model is European Union. Its integration project envisages coordination of macro economic policies, common currency, Mercosur Bank, common citizenship and cooperation in development of infrastructure culture and education. Mercosur countries signed an Air Services Agreement in 1996, under which airlines of member countries can fly into the international airports of the region freely. The region is binding itself with a growing network of cross-border roads, electricity grids, gas pipelines and other infrastructural linkages. The Secretariat of MERCOSUR is located at Montevideo in Uruguay. But it does not have supranational powers like the EU Secretariat in Brussels. The Presidency of Mercosur rotates between member states every six months marked by summit meetings. The President in Jan-June 2009 is Paraguay followed by Uruguay in the second half of 2009. India-Mercosur Trade : India‟s trade with Mercosur in 2008 was about 5.6 billion dollars of which our exports were 3.8 billion and imports 1.8 billion. India- Mercosur PTA : This was concluded in March 2005. Preferential duty (10-20 percent in most cases) is given to 450 Indian products entering MERCOSUR and reciprocal concession to 450 products of MERCOSUR entering India. List of products can be accessed in the Commerce website http://commerce.nic.in/flac/india_mercosur_pta.htm The PTA should become operational in the first half of 2009 after the ratification by Uruguay. The other three Mercosur members have already ratified. srtepc Dossier on Argentina - 51 - Travel Guide Information for Business Visitors to Argentina Importance of visit : Argentine business is people-oriented unlike the system-based USA or Europe. Face-to-face meetings and personal contacts make a big difference. The Argentines would be wary of placing order from an unknown company from India based merely on correspondence. Visits are, therefore, important. The visitors should keep at least five working days (Mon-Fri) since flying visit of one or two days will not be sufficient after the long journey and jetlag. It is advisable for Indian business visitors to combine their visit with other countries in the region. Our Embassies in the region would be happy to provide guidance and facilitation. Contact details of Indian Embassies in the region are given in the website of the Embassy. Contact the Embassy before the visit : The visitors are invited to contact the Embassy a few weeks before the visit. They should give a comprehensive profile of their companies and details of the products to enable the Embassy to identify the importers. The Embassy would give information and list of importers. Based on this, the exporters can establish preliminary contacts with the importers in Argentina. Once the dates of visits are confirmed, the Embassy can even fix up meetings for the exporters before their arrival in Buenos Aires and can also help in tying up interpreters and hotels. Business Centre : After arrival in Buenos Aires, the visitors are invited to visit the Business Centre of the Embassy as the first stop. The Commercial Officer, Dr. Marcelo Roberto Quatromano, Ambassador Viswanathan and his colleagues would be pleased to meet and provide information and guidance. The Centre can be used for holding meetings, for making presentations and for communications. Computer, Internet, phone, fax and multimedia projection facilities are available for use, free of cost. The Business Centre has a beautiful and inspiring view of the 20 kilometre wide Plata river with cargo and cruise ships, sailing boats and ferries to Uruguay. Tax Free Shopping in Buenos Aires : Hundreds of stores offer Global Refund's Tax Free Shopping service in Buenos Aires, You will be able to purchase leather goods, clothing, handicraft, jewelry and hundres of other articles, and benefit from a refund of up to 16% of the purchased amount. Remember to look for the Tax Free Shopping logo and ask for your Global Refund cheque. Only Argentine-made products are eligible, and your purchase must exceed Arg. Pesos 70 to be entitled to a refund. Business Visa - Visa from the Embassy of Argentina in New Delhi : This can be obtained at the Argentine Embassy in New Delhi. Under the bilateral agreement, the srtepc Dossier on Argentina - 52 - Argentine Embassy gives 3 years‟ multiple-entry visa, which is valid for a maximum period of 15 days during each visit. This is likely to be liberalized shortly. The Embassy would require comprehensive information about the company, the visitor and the business proposed to be done with Argentina. Sometimes the Argentine embassy asks for original and notarized invitation from Argentine clients. The Argentine Foreign Office has clarified that as per their visa regulation, there is no need for such an invitation. It is required only when Argentine companies take the initiative and invite Indian companies. Embassy of Argentina, New Delhi [Ambassador: Mr. Ernesto Alvarez] Visa In-charge : Mr. Lopez Achaval,Third Secretary A-2/6, Vasant Vihar, New Delhi Tel.No. (91 11) 41661982, 83, 84 Fax.No. 41661988, 89 E-mail embargentindi@yahoo.com, eindiconsul@hotmail.com Yellow Fever Vaccination Certificate : With effect from 12 June 2008, Indian visitors to Argentina are required to take yellow fever vaccination and take the certificate during travel. Argentines applying for visa also need to produce a yellow fever certificate for visa. This has become necessary after the outbreak of yellow fever in some parts of Argentina. Airlinks : From India the best way to reach Buenos Aires is through European cities like Frankfurt, London and Paris. Transit visa would be needed at these airports. The other options are: Dubai – Sao Paulo – Buenos Aires (through Emirates) Kuala Lumpur – Johannesburg – Capetown – Buenos Aires (through Malaysian Airlines) Mumbai – Johannesburg – Sao Paulo – Buenos Aires (through South African Airports : The international airport of Argentina, „Ministro Pistarini’ at Ezeiza - is located about 22 km away from the city. The domestic airport, „Jorge Newbery’ is located close to the city (6 km from downtown). From the domestic airport, there are also flights to Uruguay and some neighbouring countries. No food stuff should be carried either in the hand or the unaccompanied baggage since the customs authority is very sensitive and restrictive about phytosanitary issues. At the time of departure, an airport tax of USD 18.00 or its equivalent in the local currency has to be paid. At the airport one can get a VAT (IVA – Sales tax) reimbursement on purchases (receipt to be submitted) made within the country for an amount over USD 70/- (per invoice) and in shops operating with the “Global Refund” system. On arrival at Airport : On your arrival at the Ezeiza Airport, please take the prepaid taxi [REMIS] service. Depending upon the traffic and the day, it takes about 30 srtepc Dossier on Argentina - 53 - minutes to one hour to reach the city from the airport. The taxi fare is 125/- pesos equal to US $ 40/-. Please be careful about freelance taxi drivers since there have been cases of overcharging and even robbery by them who take advantage of foreigners. Changing money : Currencies can be changed easily and international credit cards are widely accepted. US Dollar is used freely and even some shops accept them. Places of visit in Argentina Buenos Aires : The city of Buenos Aires is the big cosmopolitan gateway to South America. Modern, dynamic, bustling with activity, and full of history, this great capital of the Argentinean republic, however, has managed to conserve old traditions and unforgettable small niches. It fascinates the traveller with its ambience, with the very different personalities of each of its barrios or neighbourhoods, with the kindness of its people and its ample offer of cultural events as well as shopping opportunities. "La Reina del Plata" The Queen of Silver (of the Rio de La Plata) as it is also known, will not cease to surprise the visitor with its contrasts. Here you will find the fondness felt for your local barrio or neighbourhood, the melancholic tango, the never ending discussions over a cup of coffee, side by side with the mirror surface windows of modern buildings and mobile phones. It is also the most elegant city in South America, and the city that best expresses the varied and dissimilar essence of Argentina itself. It was founded by the Spaniards on no less than two occasions. In 1536 Pedro de Mendoza gave it the name of Santa María del Buen Ayre, using the same name for the fortress he had built to defend it, both in honour of the Sardinian Virgin venerated by sailors. In 1580, Juan de Garay foundet it for the second time. Some believe that the first foundation took place in la Vuelta de Rocha (La Boca), although others argue that it was in the Parque Lezama (San Telmo), where the river came to at that time (all the way to the present day Avenida Leandro N. Alem. This area has later been regained from the waters. Thus the city was born, lost in contemplation between the port and the river, wide and muddy, but in the XIXth century it grew, in a European dream of refinement, with wide boulevards, tree shadowed streets, with mansions and public buildings designed by famous architects. Located on the banks of the Río de La Plata, and surrounded by the splendour of the Argentinean countryside, you will here find a harmonious mix of old buildings like colonial time mansions, with modern skyscrapers and museums, theatres and coffee shops. And its population has grown due to the constant waves of immigrants, mainly of European stock, all which has given it a very interesting cultural framework. srtepc Dossier on Argentina - 54 - La Reina del Plata, surrounded by the Province of Buenos Aires on one side and the Río de La Plata river on the other, proudly proclaims itself to be the "City that never sleeps". For those that enjoy night life there are restaurants and pastry shops open 24 hours a day. You can even go shopping until midnight in many commercial malls and shops. Buenos Aires offers a great panoply of attractions: monuments, churches, museums, art galleries and theatres; plazas, parks and gardens with old trees, characteristic barrios or neighbourhoods, big shopping malls, traditional and modern style hotels, restaurants offering local and international cuisine. It is connected to the rest of the country and the world by large transport network, with hubs like the port which receives cruise ships and ferries, two airports- one international called Ezeiza, located 22 kilometres (18 miles) from El Obelisco, the obelisk that traditionally marks the centre of the city. There is a also a feeder and domestic lines airport six kilometres (4 miles) from the centre. There are railroad connections, highways, National Routes and a bus terminal for public domestic transport of passengers only a little more than a kilometre away from the city centre. Its sheer size obliges the traveller to plan well his (or her) visit. Without a good guide, the city may look like a disperse and unconnected place. We therefore suggest to choose different tours according to the time that the traveller has available for his visit. Getting around in Buenos Aires : Like many other Latin American cities, Buenos Aires also has its share of crime and violence. The visitors have to be extremely careful with their travel documents and valuables such as jewellery, expensive watches, camera, video camera, cellular phones and laptops. If confronted by muggers and criminals, it is advisable to give away the valuables without any resistance. The muggers might harm you. They might have guns and can be violent under the influence of drugs. The visitors should carry about USD 20/- in a purse to be given away quickly if confronted by muggers. The rest of the money and credit cards should be kept separately and secretly. In case of any problem, the tourist police can be contacted at (i) the Tourist Police Station (Comisaria del Turista), Avenida Corrientes 436, Tel.No. 0800 999 5000 / 4346 5748, 43282135, mail- turista@policiafederal.gov.ar and (ii) Defensoría del Turista, Av. Pedro de Mendoza 1835 (Museo de Bellas Artes de La Boca “Don Benito Quinquela Martin”), Tel.No. 43027816, mail-turista@defensoria.org.ar Buenos Aires has a rich variety of cultural, touristic and nightlife activities and international restaurants. The visitors can certainly enjoy these while taking precautions. Dinner time is generally after 9 PM and night clubs and bars are open till early CORDOBA : The second most important city in the Republic of Argentina is a compound of highlands, flatlands, neat watercourses and a great amount of beautiful srtepc Dossier on Argentina - 55 - sceneries that will reach into the traveller's senses, filling them with pleasant experiences. The City of Cordoba is commonly known as "La Docta", due to the large number of important universities it hosts, and as "The City of Bells", because during the colonial times both the Franciscan and the Dominican Orders erected a lot of churches in it. This city combines all the attractions of modern cities with a peaceful and country-like way of life. The Spanish aristocrat Jeronimo Luis de Cabrera founded it at the north of the Suquía River on July 6th of 1573, at the area where nowadays lay the Yapeyü Neighbourhood. The first name given to the brand new town was Cordoba de la Nueva Andalucía. Some time later it moved on to the southern margin of the river, where it took its definitive emplacement. The geographical placement of Cordoba promptly revealed to be a most strategic one, for it developed as the main connection between the City of Buenos Aires and the Countries of Peru and Chile. This fact triggered the economical development of the city around the 17th and 18th centuries. One of the primary elements for this development was the natural surroundings of the city, where the birth of the highlands meet the plains, whose good-quality soils were exploited by European immigrants who brought wheat and barley with them. During the 19th century, with the arrival of the railway and technological development, the highlands became promptly settled, giving birth to big hotels for the travellers and to the huge casonas (mansions) made by its rich inhabitants. On present days, Cordoba has turned into a modern and important city (the second most populated one after Buenos Aires throughout Argentina). Its streets and avenues merge the colonial architecture with tall and complex buildings. In this city, the visitor will find a lot of lovely streets to stroll by, along with an arrangement of modern malls, shopping centres and coffee shops. If you come to Cordoba, you will be able to take some of the pedestrian circuits connecting the San Martin Square with the Cathedral, the Historical Town Hall, the Manzana de las Luces -with the Church of the Company of Jesus-, the Casa de Trejo, the Monserrat National School and the Fray Jose Antonio de San Alberto Museum. The tourist attractions are enlarged by the presence of the Coastal Road by the Suquia River, the Cordoba Stadium and the Trade Fair Compound of Cordoba, where international expositions take place throughout the year. At few kilometres from the outskirts of the city, the visitor will be able to take some of the large amount of alternatives as excursions on all-terrain vehicles or on mountain bikes and para gliding over the clear skies of one of the most beautiful regions of Argentina. srtepc Dossier on Argentina - 56 - In few words, Cordoba is altogether history and nature; it is wild countryside and its impressive landscapes. And it is a wise and magical choice for the audacious traveller. SALTA : In the beginning Salta was an ocean, just an ocean. Deep, blue, mysterious. There lie the discovered fossils, millions of years old, belonging to marine invertebrates as proof. And today, millions of years later, Salta is a city surrounded by greenness; lavish and attractive, historic and generous; in a word: singular. When travellers set foot on the warm streets of Salta, they immediately understand that this is a place where nobody is a stranger but everybody a friend. A place where colours dominate the landscape. A place where mountains, valleys, ravines, rivers or streams, conspire to create an image of the earth where spring never ends. Sedentary farmers lived in these vast fields a thousand years B.C.; and the caves at Guachipas and the stones of Tastil, leave no doubt about it. By the end of 13th century, the influence of the powerful Inca Empire reached the area; and with the arrival of the Spanish conquistadors, the more recent history began. There are different opinions when the time to explain the name of Salta arrives, though only two stand as the most commonly accepted. On one side, stand those who believe it comes from the Quechua language, meaning "beautiful place, nice for settling". And on the other side, stand those who believe it alludes to the name of a local tribe called Sahta, belonging to the Chaco's Lule nation, which had lived in this valley until the arrival of the Spanish conquistadors. Hernando de Lerma, a 37-year-old native to Seville, chose the Valle del Salta valley to found the city, in April of 1582. He brought in his ego and his own surname, and called it the City of Lerma in the Valley of Salta. He had some "Indian friends", and made use of them to his advantage in creating natural defences around the settlement, almost permanently under siege by the "hostile natives". A little after that, the Jesuits were the first to grow vineyards and orchards. Currently, ninety five percent of its population is comprised by indigenous blood. Under the incredibly diaphanous skies characterizing the region, the tourist circuit is an open temptation for those who do not need to pick a reason for travelling. Through the 520 kilometre long circuit, and amongst mountains, cacti and shepherds looking after their sheep and goats, towns filled with folklore emerge, with their particular gastronomy and the subtle enchantment of their pitted streets, their high sidewalks, and their façades containing doors and doorframes made out of b locust tree. Four centuries plus after its foundation, Salta is a symbiosis of history and scenery; of native and Spanish heirs, who identify themselves with the habits and rituals particular to their own group; sharing, nevertheless, much in the way. There are only srtepc Dossier on Argentina - 57 - four ethnic groups still living under a tribal organization system at the Salta province; wichi, chorotes, chané and chiriguanos. One of the best ways to truly live every minute, is by capturing the essence of the place and its odours, and blending with the local people, getting impregnated with their habits and expressions. With multiple direct flights from Buenos Aires, Córdoba, Jujuy, Rosario, Tucumán, Santiago de Chile, La Paz, and other cities in South America, Salta is an ideal destination. Alongside the main arteries, travellers will find a lodging infrastructure including hotels, hostels, lodging houses, cottages, and tourists ranches adapted to their preferences. As for the intense and amusing nights, travellers will find plenty alternatives where to choose from: like listening to some folk, Latin, melodic, salsa, tango, pop or rock music; strolling or gambling at the casino; dancing in modern discotheques, or sharing a soirée at a pub or a folk restaurant. Colonial and modern, always safe and welcoming, the City of Salta attracts thousands of visitors throughout the year. Its warmth and serenity, the attractive Spanish physiognomy of its streets backed by the greenness of its surrounding mountains, and the gentleness of its mild weather, constitute the right frame for the most variegated activities. If travellers choose Salta the Beautiful as their destination, she will generously offer her heart in return. JUJUY : Full of contrasts, the Province of Jujuy opens up a plethora of dream destinations. Located in the extreme northern part of the North-eastern Region of Argentina, with altitudes ranging from 1259 m.a.s.l. to above 6000 m.a.s.l. it has a population of over 604 thousand people. Its varied landscapes allows the traveller to practise different types of adventure tourism, while at the same time enjoying an immense landscape filled with colours, silences and sounds, amongst valleys and gorges, amongst mountains and water courses, and, all coupled to the simplicity and culture of its people. Jujuy shares its 312 kilometres long northern frontier with Bolivia and in the west 139 kilometres with Chile. In the east and south it borders the Argentinean Province of Salta. The Spanish conquistadors that arrived in these lands encountered numerous indigenous peoples, such as the Omaguacas, the Ocloyas and the Jujuyes. After several failed attempts to enter the Region, during which we may mention two occasions when settlements founded by the Spaniards were razed to the ground by the srtepc Dossier on Argentina - 58 - native population, the military superiority of the Spaniards finally prevailed and on April 9th, 1593, Francisco de Argañaraz y Muguía founded San Salvador de Velazco in the valley of Jujuy, the present capital of the Province During the wars for independence, Jujuy became the battlefield between the so-called Northern Army - el Ejército del Norte and the forces fighting on the side of the Spanish Crown. In 1812, the general Manuel Belgrano led an ordered retreat, known as the Jujuy Exodus - "Exodo Jujeño". The decisive action by general Martín de Güemes and the replacement of Belgrano by José de San Martín, ended in the liberation of the Province that achieved its autonomy in 1834. In the territory of Jujuy, the traveller can go - always with San Salvador de Jujuy as a central point - from the almost glacier like cold of the Puna highland to the tropical warmth of the rivers close to the Río San Francisco River, passing through the temperate area of the Gorge of Humahuaca. Thus, the traveller may chose without problem between a trek or horseback ride through the subtropical Andean low valleys - the Yungas, or else a tourist circuit of the so called Ramal Jujeño, which, although it is sometimes as a place of minor interest for tourism has the following to offer the traveller, the Valle Grande, Siete Aguas, Fraile Pintado and, especially the National Park of Calilegua, in which you will find the jaguarundi, the northern guemul and the River otter, three species in acute danger of extinction. Throughout the Region, the houses seem to grow from the earth itself: made of adobe, clay and straw bricks, catching the attention of most tourists that visit the area, whether by car, biking, and hiking or by horseback. Thus, Jujuy has become the Province of northern Argentina most visited by tourists. Its capital city of San Salvador de Jujuy, located 1660 kilometres from Buenos Aires, its rich history, its excellent roads, a modern airport, its multiple tourist circuits that include landscapes crowned by valleys and peaks, where one can practise all types of adventure tourism, coupled to its excellent network of services, makes this area a place to visit during any time of the year. GUAZU CITY AND IGUAZU WATERFALLS : The story goes that many years ago a young Guaraniran away with a beautiful maiden who was about to be sacrificed in honor of a serpent who lived in the depths of the River Iguazu. When she discovered this insult, the serpent let her rage flow over her back, and, twisting it, split the course of the river, trapping the young lovers and thus creating the waterfalls of Iguazu. Many years later, the traveler posing in front of the falls not only gives in to their fascination, but also feels the presence of the young lover in the dense forest around, and of the beautiful maiden who falls, unharmed and majestic, from high above. The visitor is facing one of the wonders of the world: the most spectacular waterfalls that exist on the face of the earth. srtepc Dossier on Argentina - 59 - Only after gazing a while in wonder does he or she realize the immensity of the falling volume of water, and the fact that it has been falling for centuries, giving the impression of an ongoing harmonious "catastrophe". From a distance, the falls can be seen as a long, blue-shaded, snowy hill collapsing ceaselessly and harmoniously onto another liquid mass that flows in silent majesty until it is lost in the abyss. Over all this is the clear blue sky, and all around the intensely green forest. A tourist venue par excellence, it was first glimpsed in the year 1542, when Alvar Núñez Cabeza de Vaca was crossing from the Atlantic Ocean to Asunción in Paraguay. The conquistador, amazed at the sight of the falls, christened them as "Saint Mary's Falls", a name which over time was replaced by its primitive Guaraniname: "Iguazu" (I: water; Guazú: great), i.e. "great waters". At that time the region was inhabited by natives of the Mbyá-Guaranitribe, who, around 1609, began to live within the evangelizing influence of the Jesuit fathers, who set up an experiment unique to Latin America: the establishment of a system of "reductions", that at its height included 30 towns scattered throughout the regions of the Tapé and the Guayrá (currently the south of Brazil and Paraguay), all the Argentine province of Misiones, and part of the north of Corrientes. Political and economic differences with the throne of Spain led to the expulsion of the Jesuits from the region in 1768. The zone of the waterfalls passed into oblivion from then on until August 1901, when the explorer Jordan Hummell organized the first tourist excursion to the area. One of those travelers was Victoria Aguirre, who, when this excursion had to turn back for lack of proper roads, donated a large sum of money to open a land-route between Puerto Iguazu and the waterfalls. This date marks the beginning of tourist trips to Iguazu, and has been claimed by the community as its foundation day, in homage to Victoria Aguirre, who then became a kind of protector, a driving force for the growth of tourism and of the population. This is its official history so far. Behind and around it lies a permanent effort, starting with the pioneers and continuing with the present inhabitants, to develop and give an international projection to one of the main tourist attractions on the planet. Excursión. MENDOZA : As an oasis. Travellers in the Argentinean western central area zone cannot avoid getting the impression that the Mendoza Province is a real manmade oasis. An oasis surrounded by a notable balance between the mountains and unpopulated highways, all of which come together to create a fascinating and unique experience. Pedro del Castillo founded the Capital City in the year 1561, and it immediately turned into the regional metropolis of the Cuyo area. It experienced an ample commercial, industrial and cultural development, which was interrupted by a violent earthquake in the year 1861. However, years later, with the Capital City's new urban layout, and the arrival of the railroad in 1885, the province took a great step forward. By the end of the 19th srtepc Dossier on Argentina - 60 - century, Mendoza managed to integrate its provincial territory and started the consolidation of the different parts with the decisive participation of the immigrants. Mendoza is synonymous with peace and welfare. Thus, even today, its inhabitants interrupt their working day for lunch and to take a siesta. A very provincial custom that seduces most travellers, who end up adopting it. In the Capital City and in the main Capitals of its Department, the traveller will find subsidiaries of the most important banks, apart from representation offices of the most commonly used credit cards, as well as money exchange, car rentals, travel agencies and numerous urban transportation lines. It is a cosmopolitan centre with direct connecting flights to Buenos Aires and Santiago de Chile. It closeness to the Andean Cordillera Mountain range turns it into an unbeatable destination for adventure tourism. You can enjoy endless and marvellous hikes, horse rides through the greenery of the landscape, nautical sports in its crystalline waters, mountaineering, winter sports and the ascension of imposing snow-capped mountains, besides having the chance of capturing impressive sceneries on film. The renowned Wine Route deserves a chapter of its own; on it travellers can visit hundred year old wine cellars and sample excellent vintage wines produced out of carefully selected grapes. Mendoza is a dream garden. Mendoza is a monument to peace. Mendoza is recreation, adventure and so much more. Travellers need only to make up their mind. Mendoza will not disappoint them. SAN LUIS : San Luis has it all. From a small stream where to appease your thirst, and the impulse to get in touch with untamed nature in a live scenery, sketched over its imposing Pampa sierras, to the main tourist services that each and every traveller requires for his safety and comfort. It is located in the geographical centre of the Argentinean territory. It limits to the West and Southwest with the Province of Mendoza, to the Northwest with the Province of San Juan, to the North with the Province of La Rioja, to the Northeast with the Province of Córdoba, and to the East and Southeast with the Province of La Pampa. San Luis recreates a panorama of sierras and hollows, streams and rivers of capricious courses, and hot thermal springs of uncertain origins. It is a crossroads from which all parts of Argentina can be accessed. Its capital, which stands alongside the Chorrillo River, has gotten to the present time keeping its traditional physiognomy, mainly expressed by the big old houses and colonial residences of ample and sunbathed patio courtyards. In the course of time, San Luis has managed to satisfy the different tastes through its excellent services, and its diverse natural as well as cultural attractions. Heretofore, it is a tempting place for travellers wishing to enjoy nature. srtepc Dossier on Argentina - 61 - The South offers the chance to practice unconventional tourism. There is a profusion of lakes in its scarcely populated plains. An interesting fauna and many birds from the region can be watched there, or else by taking a photo safari. Though in general, San Luis offers important tourist zones in the central, Northeastern and North-western parts of its territory. The capital city of the Province, Merlo, Potrero de Los Funes, El Trapiche, Carolina, Florida, Potrero de los Funes, San Francisco del Monte del Oro, Balde, Villa Elena, among other splendorous and peaceful towns are here, all of them with a natural enchantment that will capture the soul of impenitent travellers. Shopping Malls Galerías Pacífico Abasto de Buenos Aires Unicenter Patio Bullrich Paseo Alcorta Alto Palermo Jumbo Palermo El Solar de la Abadía Florida y Av. Córdoba, Tel: 5555-5110/5118 Av. Corrientes 3247, Tel: 4959-3400 Paraná y Panamericana - Martinez. Tel: 4733-1166 Posadas 1245. Tel: 4814-7400/7500 Salguero 3172. Tel: 5777-6500 Av. Santa Fé y Av. Coronel Díaz. Tel: 5777-8000 Av. Int. Bullrich y Cerviño. Tel: 4778-8000 Luis María Campos y Maure. Tel: 4778-5031 Super Markets / Departmental Stores Carrefour Salguero 3212, Tel.40112700 46 stores in capital and 19 outside. Fallabella Florida 343/202, Tel. 59505000/5060 (Three, of which two are in the capital.) srtepc Dossier on Argentina - 62 - Coto (82 out of which 50 in the capital) Jumbo ( 11 of which 4 are in the capital) Wal-Mart (5, of which one is in the capital) C & A (5 stores in the capital) NOTE: Florida and Lavalle are the famous shopping streets in Buenos Aires. They are over two km. long each. Cars are not allowed, they are for pedestrians only. Spanish phrases for visitors Hello Good morning Good evening Good night How are you? Very well Hola Buenos Dias Buenas Tardes Buenas Noches ¿Cómo está? Bien Mucho gusto / Pleased to meet you Encantado What is your name? ¿Cómo se llama? My name is …… Mi nombre es …… Please Por favor Excuse me Permiso Thank you Gracias Thank you very Muchas gracias much Yes / No Si / No Goodbye Adios / Chau See you later Hasta luego I don´t understand No entiendo Me gusta I like Argentina Argentina Where is? ¿Dónde está? Address Dirección ¿Me puedo Can you help me? ayudar? I need a taxi Necesito un taxi Do not worry No se preocupe I want …. Yo quiero I agree Estoy de acuerdo No problem No hay problema We should negotiate Letter of credit Wire transfer Sample Exchange Exchange rate Business card It is a pleasure doing business with your company Cheers Welcome I am vegetarian Breakfast Lunch Dinner Meat Chicken Fish Sugar Rice Today Tomorrow Night Now Later Wait for me Pick me up at … Avenue Street Debemos negociar Carta de crédito Transferencia Muestra Cambio Tasa de cambio Tarjeta Es un placer hacer negocios con su empresa Saludos Bienvenido Soy vegetariano El desayuno El almuerzo La cena Carne Pollo Pescado Azucar Arroz Hoy Mañana Noche Ahora Después Espera por me Buscame a las … Avenida Calle srtepc Dossier on Argentina - 63 - Entrance Exit How much is the cost? Expensive Good Bad Luggage Room Bill Cash Entrada Salida ¿Cuánto cuesta? Caro Bueno Malo Equipaje Habitación La cuenta Efectivo Credit card Coffee (with milk/sugar) (sugar free sweetner) Tea (-do-) Mineral water Aerated water Red wine White wine Tarjeta de Credito Café (con leche/azucar) (Edulcorante) Té (-do-) Agua mineral sin gas Agua con gas Vino tinto Vino blanco English Newspapers : The Buenos Aires Herald List of Holidays (2009) Jan 1 March 24 April 2 April 10 May 1 May 25 June 15 July 9 August 17 October 12 December 8 December 25 New Year‟s Day Truth & Justice Day Malvinas Day Good Friday & Easter Labour Day National Day (Anniversary of 1810 Revolution) National Flag Day (Belgrano Day) National Independence Day San Martin Day Race Recognition Day Immaculate Conception Day Christmas Day Summer holidays are from 20 December to 31 January. Visitors should avoid this period. Travel Agency : Visitors can use this agency for hotel and transportation and tours. The Embassy uses its services. Central Holiday Tour Av Pte Roque Saenz Peña 995, 3B 1035 Buenos Aires. [Contact person: Mr. Francesco Durante Pace] Tel./Fx 011-4326-2748, 4325-4578 fdurante@central-holiday.com.ar; www.central-holiday.com.ar Tourist Information : www.sectur.gov.ar, www.bue.gov.ar (city information) www.todotango.com (about tango and culture) srtepc Dossier on Argentina - 64 - Trade Associations / Chamber of Commerce & Industry  Argentine Chamber of Commerce (Cámara Argentina de Comercio) Av.Leandro N.Alem 36 Tel (54-11) 5300 9000 www.cac.com.ar Argentine Chamber of Commerce, Industry and Production (Cámara de Comercio, Industria y Producción de la Rep. Argentina) Florida 1 – piso3 Tel (54-11) 4331 0813 www.cacipra.org.ar Argentine Industrial Union (Unión Industrial Argentina) Av. De Mayo 1157 Tel (54-11) 4124 2300 www.uia.org.ar Chamber of Exporters of the Argentine Republic (Cámara de Exportadores de la Rep. Argentina) Av. Roque Sanez Peña 740 – piso 1 Tel (54-11) 4394 4482 www.cera.org.ar Argentine Importers Chamber (Cámara de Importadores de la Rep. Argentina) Av. Belgrano 427 – piso 7 Telefax (54-11) 4342 0523/1101 www.cira.org.ar Argentine Importers & Exporters Association (Asociación de Importadores y Exportadores de la Rep. Argentina) Av. Belgrano 124 Tel (54-11) 4342 0010 www.aiera.org.ar Investment Promotion Agency www.prosperar.gov.ar       srtepc Dossier on Argentina - 65 -