A country’s internal business climate can be significantly impacted by external forces, as we’ve seen through China’s longstanding and multifaceted presence in Latin America. In Argentina, for example, the Asian superpower has shaped business, economics, and everyday life in agriculture, rare earth elements, and a growing flow of imports, from the BYD electric and hybrid vehicles rolling into the port of Zárate to e-commerce imports that have hit record highs.
It’s a complex picture made even more complicated by the rising profile of China’s biggest rival. In October 2025, the United States activated a $20 billion currency swap, a mechanism not used with other governments since 2002. Just a few months later, in February 2026, the two nations signed the United States-Argentina Agreement on Reciprocal Trade and Investment.
“In a world of great power rivalry, the countries in between have a choice: compete with each other for favor or to combine to create a third path with impact,” Canadian Prime Minister Mark Carney declared this January at Davos.
Carney used the words “principled and pragmatic” to describe his nation’s approach for the year ahead—and it’s a philosophy we’ve heard echoed by the Latin American business leaders. “Latin America today is trying to strike a pragmatic balance,” Sergio Spadone, a leading expert in Latin America-Asia trade, told us. “It doesn’t want to choose between China and the United States; it wants to trade, attract investment, and maintain room to maneuver.”
“Argentina’s challenge is not choosing between Washington and Beijing. It is building enough economic strength to avoid being defined by either,” said Marcos Buscaglia, founding partner of Alberdi Partners who previously led Latin America economic research at Bank of America, Merrill Lynch, and Citi.
Foreign direct investment (FDI) is one important aspect of building economic strength. But it’s not the only piece of the puzzle. Fernanda Vicente, a leading voice of entrepreneurship and social innovation in Chile, emphasized the importance of market knowledge. “You can have resources, but if you don’t understand the market, capital does not correct a poor reading of the environment.” She called out the importance of regulation, “a critical and often underestimated factor. It is not just a legal issue; it is a strategic one: it defines timing, viability, and sustainability.”
“Expanding is not moving faster; it is moving with a greater understanding of the context,” said Gabriela Jimenez Cruz, a Mexican business leader who led public policy and government affairs for Uber LATAM.
With Cruz’s words in mind, let’s look at the many factors driving investment and business in Argentina, for overall perspective into Latin American business strategy today.
Added Liquidity Boosts Confidence—and Expectations
“The rating outlook is stable.” In May 2026, Fitch Ratings upgraded Argentina’s Long-Term Foreign Currency and Local Currency Issuer Default Rating (IDR) to ‘B-‘ from ‘CCC+
“Argentina’s rating reflects structurally improved fiscal and external balances, progress on economic reforms, improved prospects for FX reserve accumulation, and our expectation that the government will secure adequate financing to cover debt obligations,” the global credit rating agency explained, with a few caveats. “The rating is constrained by an international liquidity position that remains weak to manage potential confidence shocks, to which Argentina has been particularly vulnerable, as well as high inflation and a record of macroeconomic instability.”
This development continues Argentina’s upward trajectory. In December 2025, S&P Global raised its local currency sovereign credit ratings on Argentina from SD/SD to CCC+/C and its long-term foreign currency sovereign credit rating from CCC to CCC+.
Argentina has maintained a renminbi swap line with China for years. For Chinese companies, the swap has facilitated entry of its goods into the Argentine market and lowered the exchange-rate risk of doing business. For Argentina, the swap helps the nation manage its balance of payments (including IMF obligations) and exchange rate, while bringing critical reserves and liquidity to its central bank.
“Argentina needs foreign exchange reserves in part because it lacks a strong export base,” the Council for Foreign Relations wrote in its analysis of the situation.
Then a new player entered the picture. Leading up to Argentina’s October 2025 mid-term elections, the government accepted a $20 billion credit line from the United States as “a safety net of dollars.”
The move worked, keeping Milei in office and strengthening confidence in his administration’s financial reforms. Repaying the initial draw promptly in January garnered praise from US Treasury Secretary Scott Bessent, and the line still stands, despite domestic opposition.
Billion-dollar currency swaps from two sources may sound like double the strength and liquidity. But they come with potentially limiting conditions and expectations.
“Trump officials have made statements that appear to suggest U.S. support for Argentina is intended to counter China’s influence in the country,” Eurasia Review reported, noting how several U.S. officials have reportedly urged the Milei administration to prioritize U.S. investment in key areas, such as critical minerals. As competition escalates, we can expect China to similarly look after its own interests.
Such dynamics make it essential for Argentina to increase capital inflows from other sources.
“Argentina needs foreign exchange reserves of its own,” the Council for Foreign Relations bluntly declared in a November 2025 headline. The accompanying article cited “risks created by Argentina’s low level of foreign exchange reserves relative to Argentina’s substantial import needs and its relatively large stock of external debt.”
“I understand that it is a difficult time, that the priority is to strengthen macro stability, and that the global context is also complex,” said Veronica Rappoport, former deputy governor of the Central Bank of Argentina. In this 2025 interview with El Economista, she also called out the need to open markets and bring Argentina into the world stage.
Today in 2026, what could such open markets look like?
Practical Shifts and Provincial Ambitions
Under the second Trump Administration, U.S. interest in Argentina has been growing. The U.S.-Argentina Agreement on Reciprocal Trade and Investment “lowers long-standing trade barriers and provides significant market access for American exporters, ranging from motor vehicles to a wide array of agricultural products.” It’s also one of many policies encouraging investment in areas from natural resources to agriculture.
Meanwhile, the nature of Chinese investment has been changing shape. Immense infrastructure projects via the Belt and Road Initiative have been slowing down in Latin America, with activity related to bases, ports, and space stations expected to follow suit due to security and defense reasons.
“For now, China will likely hesitate to offer Latin American governments anything that could be highly strategic in nature, such as security and certain types of technology investments,” Great American Insurance Group noted in its recent risk report.
But China’s longstanding interest in oil, agriculture, and mining is expected to continue strong, “driven by the likely turnaround of the Argentine economy and projects by private businesspersons and provincial and local-level politicians,” according to the Center for Strategic and International Studies.
“Look to local problems, that’s where the opportunities are.”
–, Partner, Practical Venture Capital
Now an exploration of how these dynamics are playing out in key sectors.
Mining
If AI was the word of the year for 2025, this honor may pass to “critical minerals” in 2026: the nickel, copper, lithium, cobalt, and other essential elements that increasingly power modern life.
With demand expected to quadruple by 2040, the world entered 2026 with China the dominant player in extraction and processing and maintaining its foothold in Argentina, from continued investment in the Lithium Triangle to an exploratory meeting between Jiuling Lithium and authorities of the resource-rich Salta province. In May, the Milei Administration approved a $1.24 billion mine expansion in Jujuy province, via a joint venture of Ganfeng Lithium Group, Lithium Argentina AG, and state-owned JEMSE.
The Trump Administration is making moves of its own to secure these valuable resources, convening a Critical Minerals Ministerial in Washington, launching the Forum on Resource Geostrategic Engagement (FORGE), and signing bilateral critical minerals agreements with 11 nations, including a nine-figure agreement with Argentina.
“Today, Argentina sent a clear signal to the world: we are a reliable partner, open to trade, and committed to clear rules, predictability, and strategic cooperation,” said Minister of Foreign Affairs Pablo Quirno.
Opportunity outlook: As these developments take shape, watch for activity at the provincial level as well.
In Mendoza, Zonda Metals is bringing mining to a region more traditionally famous for malbecs. In one of many projects under Argentina’s Incentive Regime for Large Investments (RIGI), Zonda Metals GmbH and Grupo Alberdi plan to begin construction next year on a mine targeting 40,000 tonnes of copper output per year, with a mine life of 16 years, potentially extendable to 27.
In Argentina’s San Juan province, an established mining region, Vicuña is leveraging the RIGI investment framework for potentially record-setting gold, silver, and copper operations. Challenger Gold’s Hualilan Project is also a player here, with promising technical and economic pre-feasibility findings for the toll milling it plans to operate in partnership with Austral Gold.
“Hualilan can be one of the engines of the economy that drives the development of the [San Juan] province and the country.”
– Sonia Delgado, Executive Director, Challenger Gold
Energy
Argentina’s energy sector plays a pivotal role in the nation’s future, with increased exports and reduced dependence on imported gas key goals of the current government.
China has an entrenched presence in this sector, with renewable projects including the PowerChina-built Cafayate solar park, wind farms in Loma Blanca built by PowerChina and operated by Goldwind, and the Cauchari solar park, financed by the Export-Import Bank of China and built by PowerChina, Shanghai Electric Construction, and Talesun Solar.
Even more strategic activity can be found in fossil fuels. The Vaca Muerta shale foundation in particular has received increased attention due to recent restrictions in the Strait of Hormuz—and even before.
“The shale formation is central to Milei’s strategy to stabilize Argentina’s economy through rising energy exports,” OilPrice.com reported in February, noting that “the government recently expanded its RIGI investment incentive program to include shale oil drilling, offering tax and currency benefits for projects exceeding $600 million. The move is expected to accelerate development and improve competitiveness.”
The United States has been paying attention to Argentina’s energy sector as well. In addition to the financial support announced in October 2025, the International Trade Association’s website touts a variety of “best prospects” for Argentina’s energy sector, such as oilfield services and equipment, pipeline and infrastructure technology, and drilling and completion, along with LNG export facility equipment and technology and renewable energy integration technologies.
Even with Shell reportedly considering divestment of its Vaca Muerta operations, many other U.S. companies are maintaining operations here. Examples include Nabors advanced drilling solutions, “driven by government incentives, operator investments, and technological advancements,” and Chevron’s crude oil and natural gas production the Neuquén basin, where the Vaca Muerta shale formation is primarily located.
“Neuquén has a principle of fiscal stability with oil fields that all administrations have respected, and this makes it a favorable choice for investors, because they know that when they acquire an area, we don’t change the rules of the game mid-production.”
–Carola Pogliano, Financial Secretary, Neuquén Province
Opportunity outlook: Look for continued investment drivers from both superpowers. The U.S. credit facility encouraging private investment in Argentina’s sovereign debt is “expected to fuel investment in the oil and natural gas sector,” according to S&P Global, who quoted YPF CEO Horacio Marin as saying “this structural change is very good for the business environment.”
Meanwhile, China is acting through both “genuine FDI,” assuming both commercial risk and property rights, and turnkey contracts, which the Buenos Aires Times described as ”a model where China places the technology, constructs the infrastructure (fundamentally wind farms and dams) and hands over the key.”
Agribusiness
The May meeting between the United States and China generated encouraging promises for the U.S. in terms of soybeans, beef, and agricultural purchases overall.
Even so, U.S.-China tensions have given Argentina’s soybean sector a powerful boost over the past several months. “Following the currency swap, Argentina immediately suspended its export tax on soybeans and sold 5.1 million metric tons (MMT) to outside buyers, primarily to China, in two days,” the American Soybean Association reported.
Overall, the outlook remains positive for Argentine producers. World Grain noted that 2026 estimates for soybean crush have been revised upward due to “strong margins, robust meal demand, and sustained plant utilization, even as record soybean exports tighten domestic balances.”
Meanwhile, the U.S.-Argentina Agreement on Mutual Trade and Investment is expected to quadruple beef imports from Argentina, “acting in response to historically high beef prices and a prolonged decrease in the U.S. cattle herd.” Unsurprisingly, the U.S. cattle industry has voiced its opposition.
Opportunity outlook: As trade wars and weather events like drought continue to create volatility in the landscape, we believe opportunity can be found through investing in Argentina’s ag infrastructure itself, as China has done via COFCO International and Feng Tian Food, along with technologies that help farmers adapt. We explored telematics in an earlier blog. Other examples are crop productivity innovator Bioceres and Nera, a digital financing and payments platform which became partially owned by Santander in 2025.
“Putting the farmer at the center of all our decisions, we will be looking for the best innovations and solutions for food security, biodiversity and climate adaptation and mitigation.”
–Ana Laura Fernandez, Managing Partner, Ignition Fund
Trade’s Supporting Infrastructure
Bringing all of these valuable resources to market requires healthy transportation networks. Maintaining such networks is particularly challenging in Argentina, Latin America’s second-largest country with a topography defined by mountains, expansive plains, and rugged plateaus. To illustrate, the Belgrano Cargas freight line is a main conduit for vital commodities, yet significant portions of track are currently out of service. And Argentina’s highways, another important mode of transport, are “in dire need of repairs absent public investment.”
Argentina’s government has been responding to the nation’s transportation needs, both at the federal and provincial levels. The province of Santa Fe announced substantial plans for port and logistics improvements, and the federal concessions network, which aims to improve much of Argentina’s highway system with private operations, recently put its first two contracts into action.
China continues to be involved in Argentina’s transportation projects. One example is CRRC International’s agreement to bring in locomotives, spare parts, and equipment. But such initiatives have been attracting attention at a global level as well, including U.S. companies.
Likely bidders so far for Belgrano Cargas modernization include Grupo México Transportes, which operates railways in Mexico and the U.S., mining giant Rio Tinto, and an agricultural consortium comprising Bunge Global, Cargill Inc., Louis Dreyfus Co., Asociación de Cooperativas Argentinas, and Aceitera General Deheza SA.
Opportunity outlook: Even as regulatory and process details spur debate, overall momentum appears to bode well for businesses in engineering, construction, raw materials, supporting technology, and more—both for FDI and more finite, introductory commitments. If your business is headquartered in the EU, Mercosur ratification (along with provisional application made effective May 1) could increase access to public tenders.
Latin American Business Leaders Share Their Advice
Amid trade wars, volatility, and continued tensions, Argentina’s key sectors are taking a pragmatic approach to the road ahead. As the nation seeks dollars, investment, and infrastructure, however, “the challenge is for this pragmatism to have a clear strategy,” Spadone cautioned, “because otherwise, the risk goes from being a bridge to becoming a battleground.”
Buscaglia emphasized that sustained autonomy for the nation requires international reserves, structural reforms, and deepened domestic capital markets, along with increases in both productivity and international investment.
For companies and investors, Vicente presented “three things make all the difference: clear metrics, scalable models, and a solid narrative.”
“Deeply understanding the market you want to enter,” she advised. “It’s not enough to adapt the product; you must understand the culture, customer behavior, and competitive logic.”
Then build a clear and scalable value proposition. “In global markets, you don’t win by being ‘interesting’; you win by solving a real problem better than others, with the capacity to grow.”
Cruz echoed the importance of market and regulatory knowledge, along with knowledge of, and connections with, key actors. “Build relationships from the start. Don’t wait for an obstacle to approach governments or partners.”
Experienced advisors can help you build the relationships and perspectives needed to navigate global trade complexities to a sustainable business strategy. Contact us today.