Piet said that mining investment in Argentina has already been subdued due to uncertainty leading up to the election.
The results are in, and incumbent Argentina President Mauricio Macri is out, with Alberto Fernandez the new president-elect of Argentina.
In an interview with the Investing News Network, Remi Piet, senior director at Americas Market Intelligence, said, “The result was not a surprise.”
As the South American country enters into a transition phase, Piet said that it is within both Macri and Fernandez’s interests for the transition of power to be smooth. The next questions for Argentina are around who will be investing there in the future.
He said that it is too simplistic to boil the result down to a pro- or anti-mining approach, saying that the future Fernandez administration will have no choice but to be pro-mining as other sectors within the Argentinian economy might suffer due to the International Monetary Fund backing away from deals made under the Macri administration.
“There will be some banks that will have cold feet with financing projects in Argentina,” said Piet, who singled out infrastructure projects as being the most at-risk from deals falling through.
On mining, Piet said because investment was subdued due to uncertainty prior to the election, it is “too simplistic to assume a new president means the end of mining investment in Argentina.”
Speaking about who will step up to invest in the country, Piet said, “The relationship with China was always strong under (Cristina Fernandez de Kirchner’s presidency), so we might see an increased presence from Chinese mining companies; but that was already the case.”
The mining sector’s importance will be all the more pronounced under the new president, as per Piet.
“Because of the potential decrease in foreign investment in other sectors, there will be a strong incentive for Alberto Fernandez to favor natural resources and extractive industries in Argentina,” he said.
“The question is who is going to make the gamble to invest in Argentina.”
Listen to the full interview above for Piet’s complete thoughts on the results of the Argentinian election, held on October 27. You can also click here for our full playlist of International Mining and Resources Conference interviews.
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Securities Disclosure: I, Scott Tibballs, hold no direct investment interest in any company mentioned in this article.
Editorial Disclosure: The Investing News Network does not guarantee the accuracy or thoroughness of the information reported in the interviews it conducts. The opinions expressed in these interviews do not reflect the opinions of the Investing News Network and do not constitute investment advice. All readers are encouraged to perform their own due diligence.