Argentina to pass landmark mining legislation

Argentina to pass landmark mining legislation

Authorities, leading industry players and unions in Argentina are expected to sign a federal mining agreement that will unify existing legislation across the country.

The long-awaited agreement will come as a boon to the industry as mining investors have increasingly favoured neighbouring countries Chile and Peru, due to Argentina’s obstructive regulations.

President Mauricio Macri hopes the imminent nationwide law will become a landmark development as he looks to double investment in the sector to US$25 billion in eight years.

Between 2007 and 2015, Argentina received only $10 billion in mining investments, compared to $80 billion and $52 billion in Chile and Peru respectively.

However, since taking office in late 2015 Macri has adopted several measures to stimulate mining investment, including the elimination of a 5% tax on mining and energy companies.

However, analysts at BMI Research warn that looming political factors could damage Macri’s plans.

“While we expect the focus on supporting mining industry growth at the federal level to offset provincial issues, local opposition and political pressure could hurt Argentina’s attractiveness as a mining investment destination,” said BMI.