The first major objective was to control inflation. Money laundering and private credit drive activity, but public works are highly compromised.
The macroeconomic order, the elimination of inflation and fiscal adjustment have become part of the prevailing demand story. That is, society itself has begun to understand that Inflation is the worst of taxes, it generates poverty and prevents the growth of the country. In this first year of management, the government of President Javier Milei has met this important objective. Starting from a critical situation, it has managed to stabilize the main indicators. Clearly there is a lot of progress to be made, but we understand that The first steps are going in the right direction.
That said, it is undeniable that our sector continues to go through a significant crisis. Although construction with private capital is proceeding at an adequate pace, driven by measures such as money laundering and mortgage credit, the construction of public infrastructure is highly compromised.
Private work has been the support of the sector during 2024. Future expectations are also positive. Mining, oil and real estate development will be fundamental in the short and medium term. The normalization of the economy and tools such as RIGI or new mortgages will give a certain boost to these investments.
The panorama of the public workHowever, it has been harder. During the year we have not been able to resolve the debt for works carried out by the previous government with the construction companies. The brake on the works that were being carried out towards the end of last year still continues and the transfer of contracts to provincial jurisdictions is delayed and without funds. This situation had a full impact on thousands of small and construction companies. (SMEs are, in the sector, more than 90% of the companies). At the time of the annual balance, many companies will have suffered not only economic losses but also their human capital, which is the most difficult to recover. In global terms, the sector has lost more than 120 thousand jobs, between June 2023 and June 2024. It must be said, however, that the trend seems to begin to reverse as a slight growth is recorded at the hands of work in the last 3 months.
Buildings Construction Housing Apartments Puerto Madero Real State
Scope
Various international studies affirm that the State (at its different levels) continues to be the main builder of infrastructure and that private investment in this segment barely reaches 17% of the total. Therefore, In a country like Argentina – where the infrastructure gap is immense – the absence of the State is problematic.
In this line, Budget 2025 allocates just 0.7% of GDP to infrastructure. Just to maintain what has already been built, countries have to allocate around 3% of GDP. In particular, we must emphasize the need to rethink a work plan regarding maintenance. Failure to take care of the existing infrastructure will generate loss of competitiveness, higher costs and accidents.
Coinciding with the new management, the Argentine Chamber of Construction developed a cycle of events throughout the year under the motto “Builders of dialogue”. The idea is in line with what we believe we should support institutionally: create spaces where the State and the private sector can work together for the development of the country.
We can only celebrate that the country can put its accounts in order. Clarity in the conditions and regulations will attract foreign investment, which is a condition for growth. The construction industry is prepared to respond to the demand for work for the works that the country needs.
President of the Argentine Chamber of Construction (CAMARCO)
Source: Ambito
