Argentina is Open for Business

As the country’s economy recovers, Vistage Argentina members prepare for a new wave of foreign investment and competition.

It’s a pivotal time for many Argentine businesses. They are gearing up to enter the international market, as the country recovers from a closed economy and years of crippling inflation.

One company actively pursuing growth outside Argentina is Conexia, which provides IT solutions to health insurance providers. Sebastián Letemendia is a partner and COO at Conexia. At the time he joined Vistage in 2010, Conexia only operated in Argentina. Since then, it has expanded into Colombia and the United States and grown from 100 to 250 employees. And with Argentina’s economy on more solid footing these days, Conexia plans to further grow its Texas-based U.S. operations, Letemendia says.

“The long-term vision from the government is fundamental for both a company and a country,” Letemendia says. “In recent years, the economic environment has allowed us to have a long-term vision.”

He’s not the only Vistage Argentina member eyeing more opportunities in the rest of the world, thanks to a newly open economy.

Opening the door to investment and optimism

Vistage Argentina released its Entrepreneur Confidence Index, a quarterly survey the organization has conducted since 2006, to Argentine business leaders.

Results reflect optimism:

56 percent say the country’s economic scenario has improved compared to the same period last year.

71 percent expect further improvement over the next 12 months.

52 percent plan on increasing investment in fixed assets over the next 12 months.

80 percent predict sales will increase over the next 12 months.

“Results show that Argentine business leaders continue to have high expectations for the development of their
businesses during the year,” says Marco Bellotti, general manager of Vistage Argentina.

Those heightened spirits come following President Mauricio Macri’s reopening of the Argentine economy to foreign companies for the first time in decades. Since winning a runoff election in 2015, Macri, a center-right politician and former two-time mayor of Buenos Aires, has made bringing foreign investment to the cash-strapped country a priority.

So far, foreign companies have announced investments of more than $33 billion in Argentina since Macri took over, with most coming from companies based in the United States, Germany, Canada, Spain, and Brazil. And Argentina has identified more than $220 billion in additional investment opportunities for foreign companies, according to a January 2018 report from the Argentina Investment & Trade Promotions Agency.

‘Companies need to reinvent themselves’

With foreign investment returning, what may seem like a challenge to others is more of an opportunity for businesses to switch models and restructure their organizations, says Vistage Argentina President Alejo Canton.

“Companies need to reinvent themselves,” he says. “When you have inflation of 20 percent to 40 percent a year, you can grow complacent, and you don’t have to be very efficient. As soon as inflation starts coming down—and competition starts coming in from the rest of the world—you need to be more efficient.”

This has been the case for Vistage Argentina member Dalia Grinbaum, vice president of Startex SA, a company that manufactures workwear and safety footwear for companies. Her business has been reactive to the country’s economic cycles and invested in the best technology to differentiate itself.

In order to enter a highly competitive market, Grinbaum decided to invest in Desma, the first German injection machine to enter Argentina for safety footwear. This allowed Startex to compete with better tools, reduce the margin of error during the learning curve, and increase sales levels.

Grinbaum, who’s been a member since 2008, credits her Vistage group with helping her set priorities. “I’m convinced the group discussions help a lot. No matter how old you are, to be No. 1, you have to continue training.”

Creating a vision

Canton first experienced the Vistage approach to ongoing development while pursuing his MBA at UCLA. He was part of an on-campus Vistage program. “I learned more from that than from most of the classes,” he said.

It made such an impact that Canton launched Vistage Argentina in 2000 when he was 29. He recognized an unmet need among business leaders. So far, the organization has averaged 15 percent growth every year for more than a decade, Canton says, building a community of more than 1,200 members and 60 Chairs.

The latest expansion in programing includes the inaugural Vistage Executive Leadership Program, which combines thought leadership from Stanford Graduate School of Business with real application through the Vistage peer group experience. The focus is on innovation.

“I expect to learn a state-of-the-art framework for defining my company’s strategy, with a very special focus on innovation, which we all need nowadays,” says Mariano Camdessus, director of Aguas SRL and a member since 2013. “As a Vistage member, I also expect to be able to work on the application of such strategy, so this Stanford-Vistage approach is very compelling to me.”

“There’s a profound desire to figure out how best to adapt to this new economic climate,” says Canton, “and we give our members a competitive advantage.”

Caption: Chairs and participants of the inaugural Vistage-Stanford program