Net foreign direct investment income was mainly explained by debt transactions and the reinvestment of profits.
The foreign direct investment of the Argentina reached the US$3.810 million during the first quarter of 2023. The data represents 2% in year-on-year terms and can be deduced from the report published on the subject of central bank (BCRA).
The sectors that most they captured dollars were: “Deposit-taking corporations, except the central bank”, “Manufacturing industry”, “Mining and quarrying” and “Wholesale and Retailrepair of motor vehicles and motorcycles”, according to the document.
Regarding the percentages captured by each sector mentioned above, the distribution was as follows: “Deposit-taking companies, except the central bank” concentrated 32% of flows of FDI with US$1,221 million; followed by “Manufacturing industry“, with u$s1,108 million, which explained 29% of the total and reversed the drop registered in the fourth quarter of 2022; and “Exploitation of mines and quarries“, with US$551 million and 14% of the flows of the quarter.
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Also, the study highlights that net income foreign direct investment were mainly explained by debt transactions and reinvestment of profitsreaching up the u$s1,892 million and u$s1,772 million. Meanwhile, income from capital contributions was US$162 million and there were net expenses of $16 million from mergers and acquisitions.
Foreign Direct Investment: the origin of the funds
As for the countries from which transactional flows originated of FDI during the first quarter of 2023, the main one was USAwith net income of US$968 million, which presents an interannual growth of 22%; followed by Brazilwith US$871 million and a year-on-year increase of 100%, and Spainwith US$630 million (26% year-on-year increase).
Then you find Uruguaywith US$245 million (year-on-year increase of 18%); Chinawith net flows of US$162 million (223% year-on-year growth), and Francewith US$155 million (19% year-on-year drop).
Regarding the debt generated for exports of manufactured goodsexperienced a decrease of US$1,211 million during the first quarter of 2023. This drop was mainly attributable to the cancellations of companies involved in the trade of food products, including oilseeds and cereals. This decline occurred after the conclusion of the “Export Increase Program” (PIE) during the first trimester.
Source: Ambito
