As a consequence of favourable international market conditions and domestic price stability, the placement of both debt and equity services has developed into a very significant source of financing for Argentine companies. Many investment projects are being financed on the capital markets, partially replacing traditional bank financing at significantly lower interest rates.

From the point of view of both local and foreign investors, the Argentine securities market currently offers a wide variety of investment opportunities. In September 1993, the executive branch issued Decree No. 1,853 on foreign investments, which repealed regulatory Decree No. 1,225/89 and eliminated any differences between the treatment of local and foreign investors. Legal obstacles to successful and profitable investment in Argentina have therefore been largely removed.

With such favourable economic and legal framework, other factors have contributed to the growth of the Argentine capital markets. As part of the broad privatisation process launched by the government in 1989, a significant portion of the equity of each newly privatised company has been sold through combined offerings consisting of a local tranche (public offering of the shares in Argentina) and an international tranche (private placement or public offering of the shares through American Depositary Receipts (ADRs) both in the United States and outside the United States and Argentina). Also in 1993, the Argentine Congress reformed the pension and retirement system. The recently formed private pension fund administrators are expected to collect at total of US$ 175 million each month, a significant portion of which will be invested in the Argentine capital markets.

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