Avon Capital Investments
ARGENTINA COUNTRY ANALYSIS

Executive Summary
Argentina’s recent debt default in July 2014 will lead to higher inflation and further depreciation of the peso in 2015. Despite this, our team still sees Argentina as an attractive market for both foreign investors and US exporters. Argentina’s relatively large, educated population, its abundant natural resources and important infrastructure needs all favor exporters. For 2015, Argentina's GDP is forecast to grow at a rate of 4.6%, which is the fourth highest 2015 IMF forecast for South America. It is also a full percentage point higher than Brazil, which is world's sixth largest economy and Latin America's largest.
Argentina’s volatile markets have soared over the last 16 months. The Merval Index rose 100% from September 2013 to September 2014. There are a number of Argentine companies listed as American depositary receipts, which have paid dividends in excess of 10% including; Banco Macro, Telecom Argentina SA and BBVA. All of which has drawn investors to Argentine stocks as they seek to cash in on this growth.
Argentina's federal government has also taken positive steps to lure foreign investors in developing the country’s Vaca Muerta oil and gas formation in Patagonia. A recent bill passed in the Senate will develop a national framework to extend drilling licenses and reduce taxes. This in concert with the aforementioned country characteristics give our team a positive outlook on the future of the Argentine economy.

General Information The Republic of Argentina is a country located in the southern region of South America. It has a population of more than 36 million people. The country is divided into 23 provinces. The Province of Buenos Aires, is where nearly 18 million, half of the country’s population, reside. The capital city of Argentina is located in that province and is called Metropolitan Buenos Aires. Argentina shares a border with five different countries: Chile, Bolivia, Paraguay, Brazil, and Uruguay. The country itself has an area of almost 3,800,000 sq feet. Behind Brazil, Argentina is the second largest country in South America. The official language of Argentina is Spanish. The currency is the Peso. Currently, the exchange rate between dollars and pesos is 8.47720. The items most frequently exported by Argentina include: soybean meal, corn, soybean oil, cars, and delivery trucks. The items most frequently imported by them include: cars, petroleum gas, vehicle parts, refined petroleum, and telephones. The countries Argentina trades most with are Brazil, China, Chile, and the United States. Argentines are also known for producing quality products including: leather goods, woven and knitted garments, silverware, and wine. The government in Argentina is considered to be representative, Republican and Representative. It contains three separate branches including the executive, the legislative, and the judicial.
Brief History The first people arrived in Argentina approximately 12,000 years ago. When the Europeans arrived in South America, only about a third of the South American population occupied the country now known as Argentina and her surrounding areas. On July 9, 1816, the United Provinces of the River Plate affirmed their independence from Spain. Argentine troops, led by Jose de Martin, crossed the Andes to free Chile and then headed north to eventually capture Lima. Between the 1870s and 1920s (see Appendix A), Argentina was completely changed in economic terms. The land that was once taken up by prairies became fenced in commercial agriculture land. The British began building railways, which allowed the farming industry in Argentina to flourish. Their largest export become wool and meat from sheep. The farming industry grew even larger and more successful with the invention of refrigerator ships which enabled meat to be