Jose Martinspresident of the Cereal Exchange and spokesperson for the Argentine Agroindustrial Council made a balance of the year and analyzed the prospects of the agroindustrial sector. The drop in the prices of primary products, why the RIGI is not so convenient for agriculture, the tax pressure, are some of the issues that worry the sector.
Below are the main aspects discussed with Scope.
Journalist: What are the prospects for the sector for 2025?
José Martins: I am an eternal optimist. The sector has achieved some things during the year, such as measures being adopted to facilitate exports, barriers being lifted, this is very good! It makes it possible to open new markets, generate additional value. Work has been done to reduce the bureaucratic burden of many of the procedures that were carried out, to eliminate these famous trust issues and so on. With the issue of the Argentinian table we have done things that involved costs, that never achieved the purpose for which they were made, but there are still things to do.
Q: Which ones?
JM: One is to try to get the blessed law that stimulates investments out of Congress once and for all, just as the RIGI (Large Investment Incentive Regime) came out quickly for some important sectors. A law that sets US$300 million as a base is of no use to agriculture. The scheme that is being worked on today has a lot to do with what we had presented at the Agroindustrial Council, with investments for the sector in terms of tax relief, accelerated amortization. Let’s hope that Congress deals with it because the previous project took us 3 years. And, due to differences, the project finally died, when in reality it was a law that greatly benefited the sector. I hope this project ends up being presented.
Q: What is the main objective?
JM: What we seek from the Agroindustrial Council is to generate investments in the interior of the country, to be able to create employment in the interior. We not only have to cut off migration from the interior to suburban centers, which are exploited with misery, but also try to achieve counter-migration. Let that person who had a bad time today in La Matanza return to his hometown. There are multiple places in the agroindustrial sector where there is everything to invest.
Q: Like which ones?
JM: From industrial establishments, processors, regional economies. We also have to think that Argentina needs infrastructure. Because all this growth is going to demand roads, routes, energy. All this has to be contemplated in a stimulus to invest. We have more than 10 years of stagnation in the harvest. years in which we do not grow. We are talking about 130 or 140 million tons and we say what a “harvest”. No, be careful. 10 or 12 years ago, if memory serves, we produced 63 million tons of soybeans. Today we are happy with 50, when Brazil, which made half as much as us, today talks about 200 million. We have a dormant potential particularly in the agro-industry.
Q: What hinders the development of that potential?
JM: For example, we do not take care of intellectual property. Here comes a company that spends hundreds of millions of dollars to discover a gene for a seed. We do not protect it. What does that company do? He goes to the country. Now, if we had an intellectual protection regime, well I mean, patents, etc., and we had a stable regulatory framework that said, sir, in 5 years you are going to pay the same tax as today, I would venture to say that Argentina jumps to 180 million tons of grains.
Q: What opinions do you have about withholdings and the exchange rate?
JM: Both topics are very important. The exchange rate problem had a lot to do with the disparity that arose between importing at one exchange rate and exporting at another significantly lower one. This is being solved.
Q: And what happens with withholdings?
J.M..: Withholdings are a total distortionary tax that does not exist anywhere in the world. For example, the soybean complex is punished too much, because we are paying 30-odd percent, but then we have to add profits, VAT, provincial and municipal taxes…
Q.: Are the provinces and municipalities becoming aware of the national government’s rule to carry out a fiscal adjustment?
J.M..: To be honest, in some yes, in others no. There are those who continue to think that they can continue spending and that someone has to pay me. I am pleasantly surprised by the policy of the National Government that set a goal and defended it tooth and nail. And when one prima facie said: but are you going to mess with retirees? With the university?, and you did, which is a clear message. The Ministry of Economy has that vision and is going to carry it forward. I also believe that in the next elections there will be support for other provinces to copy the model.
Q: If you had the opportunity to see the president, what would you say to him?
JM: Let him maintain the course he set out, but try to listen a little more to the different sectors of the economy, and not pigeonhole himself with just one sector.
Source: Ambito
I am an author and journalist who has worked in the entertainment industry for over a decade. I currently work as a news editor at a major news website, and my focus is on covering the latest trends in entertainment. I also write occasional pieces for other outlets, and have authored two books about the entertainment industry.
