When I first arrived in Argentina, I was unsure of what to expect of the economic situation. I had heard of the country’s economic slowdown, and not much else. I was quite surprised, then, when throughout the course we learned of how complex the economy’s problems are, particularly relating to Agriculture, and also by how quintessentially Argentinian they are. From the nation’s ongoing debate over export duties, government policies, the shifting and emerging markets for beer and wine, weather problems, collapsing dairy cooperatives, and more, the situation has more to it then meets the eye. However, if there was any major point to be learned across this diverse experience, it was that Argentina has been gifted with a very competitive agricultural sector.
At every discussion, lecture, farm, or winery we visited, I was consistently surprised by how innovative, energetic, and forward thinking the individuals of the agricultural sector are, especially in a nation that has chronic problems with corruption, inefficiency, and low productivity. This, in combination with low overall costs, means that the sector has a competitive advantage compared to those of other nations. This should mean that Argentinian producers can have margins large enough to continue innovating and expanding, yet government policies on everything from export duties, cooperatives, and even ordinary taxes leave producers with extra costs and bureaucracy to wade through, leaving margins lower and reducing competitiveness.
As we learned during our tours, Argentina has had a fruitful past relying on agriculture to drive the nation’s economy, leading our tour guide to proclaim that the French would once say of an affluent person that he’s, “As rich as an Argentine!”. And while the circumstances of a modern economy and globalized markets have changed Argentina since then, there is still no reason why Argentina should not take advantage of their most competitive sector to attempt to finally solve the problems that have plagued their economy throughout recent memory. Demand for Argentinian grains and meats will only increase as other emerging economies gain an appetite for these goods, and recent trade tensions in the United States have shown that there is more room for the soy and other grain industries of Argentina to grow into. Hopefully, with a new direction in government policy and a further emphasis on innovating and refining their successful existing processes, such as no-till agriculture, Argentina’s agricultural sector will finally be able to go on the offensive once again.