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Argentina passes legislation promoting the auto industry

14 September, 2022Argentina’s Senate has unanimously approved a bill to promote the automotive industry. The initiative was spearheaded and supported by IndustriALL affiliates in the country.

On 1 September, proposed legislation to stimulate investment in the automotive auto parts industry and its value chain was voted on and unanimously approved in the Senate.  

“The proposal emerged from the grassroots unions, the national trade union centres and the companies in the sector and is a firm commitment to the growth of a national industry (...). The legislation sets out an intelligent industrial development programme and a plan of action for the coming years. It is the product of a sector, and its people, that has not neglected what is important: guaranteeing and creating quality and permanent work,”

IndustriALL affiliate SMATA said in a statement.

Union representatives from SMATA and UOM have participated in various discussions to promote the bill since December 2019. The aim of the legislation is to ensure value chain integration, to make the sector more competitive and to attract greater investment. This will enable the country to industrialise, diversify and create more jobs.

The scheme sets out potential benefits for automotive investments, such as the early refund of value added tax (VAT), by establishing a reduction in the reimbursement period from six to three years and, in the case of depreciation of capital goods, from five to three years.

The law also provides for the creation of a programme to promote new investments and the establishment of a Mobility Institute, composed of members appointed by business chambers and trade unions.

Argentina’s economy minister, Sergio Massa, says:

“Our automotive industry has positioned Argentina as a strategic player on the regional stage. With production higher than pre-pandemic levels [50 per cent higher than in 2019], the prospects for the future are enormous. [...] If the state, the workers and companies continue working together, the sector can generate a positive trade balance of US$400 million.”

IndustriALL’s deputy regional secretary, Cristian Alejandro Valerio, says:

“We applaud that unions in Argentina are key players pushing for industrial policies and legislation. The unions worked to urge business chambers and national, provincial and local governments to support this initiative.

It is essential that they be proactive, in light of the deindustrialisation in the region and the changes in the global automotive industry.”