ISA October 2017 Country Report Argentina The ISA

ISA October 2017 Country Report Argentina The ISA October 2017 Argentina Country Report 1

Argentina: Key Facts Overview: • Argentina’s economy has undergone massive fluctuations in recent decades. • Argentina has one of the world’s largest agricultural industries and agricultural exports are a key element of the economy. • Argentina plays a leading role in regional politics, but has been increasingly overshadowed by a more assertive Brazil in recent years. Key Facts and Data: • Official Name – Argentine Republic • Capital – Buenos Aires • Government Type – Republic • Head of State and Government – President Mauricio Macri (since 2015) • Population – 43, 887, 000 • Land Area – 2, 736, 690 sq. km • Total GDP (US$) – $542 billion • Per Capita GDP at PPP (US$) – $20, 972 • Currency – Argentine peso The ISA October 2017 Argentina Country Report 2

Table of Contents Current Events: Economic Outlook: • Recent Political Events • Economic Overview • GDP Growth Forecasts • Key Sector Forecasts • Inflation Forecasts • Foreign Trade Forecasts • Foreign Investment Forecasts • Exchange Rate Forecasts • Outlook for Key Sector • Key Economic Issues • Economic Risk Outlook • Recent Economic Events • Other Recent Events Political Outlook: • Overview of the Current Government • Leadership Profile • Summary of the Most Recent Elections • Leading Political Parties • Forecast for the Next Elections • International Relations Outlook • Potential Conflicts • Military Capabilities • Key Political Issues • Political Risk Outlook The ISA October 2017 Argentina Country Report Demographic & Environmental Outlook: • Population Overview • Population Characteristics • Development of Leading Urban Centers • Key Demographic Issue • Topography and Climate Overview • Environmental Threat Summary • Key Environmental Issues • Demographic and Environmental Risk Outlook 3

Current Events and Recent Changes Overview The ISA October 2017 Argentina Country Report 4

Argentina: Recent Political Events and Changes Key Political Events and Changes: • President Macri’s approval rating rose to 41% in polls taken in recent months. This raised fears that his party could suffer major losses in October 2017’s mid-term elections. • Former President Cristina Fernandez launched a new political party called the Citizens Union. She plans to have the party compete in October 2017’s mid-term legislative elections. • In August 2017’s Senate primary election in Buenos Aires, President Macri’s candidate, Esteban Bullrich, finished in a virtual tie with former President Cristina Kirchner. The two will face each other in October 2017’s mid-term elections. • The disappearance of the indigenous rights champion Santiago Maldonado after a protest in southern Argentina in August 2017 caused a major scandal in Argentina. The ISA October 2017 Argentina Country Report 5

Argentina: Recent Economic Events and Changes Key Economic Events and Changes: Economic Highlight: • Argentina’s economy expanded by 0. 3% on a year-on-year basis in the first quarter of 2017. Business investment levels rose in the first quarter, allowing Argentina to record growth for the first time since the first quarter of last year. • Argentina’s inflation rate rose to 23. 1% year-on-year in August 2017. • The peso fell sharply in July 2017 due to higher levels of foreign currencies entering Argentina in recent months. • Argentina’s unemployment rate fell to 8. 7% in the second quarter of this year. • Argentina raised a better-than-expected $2. 8 billion in a 100 -year US-dollar-denominated bond sale in mid-2017. This was seen as a vote of confidence in the government’s economic reform efforts. • A World Bank arbitration tribunal ordered Argentina to pay $320 million to the Spanish firm Marsans for the nationalization of Aerolineas Argentinas in 2008. • Labor unions staged major protests against the government’s economic reforms in August 2017. The ISA October 2017 Argentina Country Report 6

Argentina: Other Recent Events and Changes Other Key Events and Changes: • Teachers when on strike across Argentina in mid-2017. Teachers unions were opposed to the government’s planned education reforms. The ISA October 2017 Argentina Country Report 7

Argentina Political Outlook The ISA October 2017 Argentina Country Report 8

Argentina: Current Government Overview: • A new center-right government took office in December 2015 when Mauricio Macri was sworn in as president of Argentina. • In December 2016, President Macri carried out his first cabinet reshuffle. The main move was his sacking of Finance Minister Alfonso Prat-Gay due to internal disputes within the administration’s economic team. He spilt that position into two positions, a finance minister and a treasury minister. Key Members of the Government: • Head of State and Government – President Mauricio Macri • Vice President – Gabriella Michetti • Cabinet Chief – Marcos Pena • Minister of Foreign Affairs – Susana Malcorra • Minister of Finance – Luis Capato • Minister of the Interior – Rogelio Frigerio • Minister of Justice – German Garavano • Minister of Defense – Julio Martinez • Minister of Security – Patricia Bullrich • Minister of Agriculture – Ricardo Buryaile The ISA October 2017 Argentina Country Report 9

Profile of President Mauricio Macri Background: Mauricio Macri became the president of Argentina following his surprise victory in 2015’s presidential election. • He was born into a wealthy family in Buenos Aires and worked for a time at a construction company owned by his father. • He first rose to prominence as the president of the popular Boca Juniors football (soccer) club in Buenos Aires in the 1990 s. • In 2005, he founded the center-right Republican Proposal (PRO) party and in 2007, he was elected as the mayor of Buenos Aires. Key Policies and Stances: President Macri moved quickly to reverse many of the policies that had been put in place during the 12 years of Kirchner rule in Argentina. • For example, he moved to improve ties with the United States and with Latin American countries with more open economic systems, such as Mexico, Colombia and Chile. • He also moved to remove currency controls and to restore the independence of the country’s monetary and statistical agencies. The ISA October 2017 Argentina Country Report

Argentina: Most Recent Elections Presidential Election – October and November 2015 Summary of the Last Elections: Results: Mauricio Macri won a surprising victory in late 2015’s presidential election, overtaking the chosen candidate of outgoing President Cristina Fernandez de Kirchner, Daniel Scioli, in the final weeks of the election campaign. • While Mr. Scioli was able to win the largest share of the vote in the first round of voting, he failed to win the election outright and his lead over Mr. Macri was much smaller than had been expected. • In the second round of voting, Mr. Macri was able to gain a majority of the supporters of the third place finished in the first round, Sergio Massa, enabling him to win a narrow victory of Mr. Scioli. Argentina’s worsening economic situation allowed Mauricio Macri to win the 2015 presidential election. • Economic growth rates had fallen sharply in the years before the election and inflationary pressures were dangerously high at the time of the election. • Mr. Macri campaigned on a platform of economic reform and of restoring the independence of the country’s economic and monetary institutions. The ISA October 2017 Argentina Country Report Source: National election authority 11

Argentina: International Relations Outlook Key International Disputes: • The Falkland Islands dispute is Argentina’s only major territorial dispute at present. • Mercosur, which also includes Brazil, Uruguay and Paraguay, has led to a major improvement in relations between Argentina and its neighbors. • However, in recent years, relations have been strained with both Chile and Uruguay. International Relations Outlook: • Argentina will continue to push for closer regional integration so long as there is not another economic collapse. • Meanwhile, Argentina will continue to fear growing Brazilian influence in the region. The ISA October 2017 Argentina Country Report 12

Potential Conflict: Falkland Islands (Malvinas) Main Disputes: • Argentina invaded the islands in 1982, but the islands were retaken by Britain later that year. • The islands were originally disputed by Britain and Spain in the 18 th and 19 th centuries. • The inhabitants of the islands have consistently rejected closer ties with Argentina since the 1982 war. Best- and Worse-Case Scenarios: • Best Case Scenario – Relations between the islands and Argentina improve, allowing for closer ties that satisfy both parties. • Worst-Case Scenario – Argentina makes another move for the islands at some point in the future, threatening another war between the UK and Argentina. The ISA October 2017 Argentina Country Report 13

Military Spending Strengths and Weaknesses The Argentine military has lost much of its influence and power since its defeat in the Falklands War in 1982. • The military government was removed from power in 1983 and the armed forces have been marginalized since then. Source: SIPRI Today, Argentina’s military capabilities remain relatively limited. • Even by South American standards, its military power is minimal. • For example, Argentina has little ability to project power outside of its borders. • Given the lack of immediate threats and the poor economic situation, there is little chance for a major increase in military spending. Outlook Argentina’s military forces are more likely to be used today in international peacekeeping missions than anything else. • With relations with Chile having drastically improved and nearly no chance of more adventurism in the South Atlantic, Argentina’s military will remain limited in terms of global power. The ISA October 2017 Argentina Country Report 14

Argentina: Political Risk Outlook Current Political Risk Ratings: Political Risk Outlook: • Despite the economic upheavals of the past 20 years and the fluid nature of Argentine politics, political risk levels remain quite low by regional standards. • For these risk levels to remain low, economic growth is needed to restore the public’s confidence in the government. Low Risk………………High Risk ISA Risk Ratings – 0. 0 to 1. 9 = Low Risk – 2. 0 to 3. 9 = Low to Moderate Risk – 4. 0 to 5. 9 = Moderate Risk – 6. 0 to 7. 9 = Moderate to High Risk – 8. 0 to 10 = High Risk The ISA October 2017 Argentina Country Report 15

Argentina Economic Outlook The ISA October 2017 Argentina Country Report 16

Argentina: Economic Overview Argentina’s economy has endured a great deal of volatility in recent decades. • Once one of the world’s richest countries, Argentina today is a middle-income country. • Low commodity and agricultural prices, coupled with the loss of export markets led to the country’s economic decline, although both have rebounded in recent years as export demand has grown. Argentina’s economy has long been based on its wealth of natural resources. • Argentina has substantial mineral resources. • Moreover, the country’s is one of the world’s leading exporters of agricultural products. Argentina’s recent economic downturn continues to threaten to undermine the country’s increasingly fragile economy. • The latest crisis is threatening Argentina with hyperinflation that could lead to another deep recession unless the government takes steps to improve the country’s economic situation. Economic Performance Comparisons: Avg. Annual GDP Growth 2012 -2016 Economic Summary: The ISA October 2017 Argentina Country Report Source: ISA Economic Forecasts Per Capita GDP at PPP 17

Argentina: Wealth Comparisons Per Capita GDP at PPP (US$) Key Wealth-Related Issues and Trends Argentina was for the best part of the past 150 years the wealthiest country in Latin America. However, its advantage its neighbors has shrunk and Chile has recently overtaken Argentina in terms of per capita GDP. Source: World Bank Poverty is a growing problem in Argentina, increased by the recent economic troubles. As late as the 1930 s, Argentina was one of the world’s richest countries. However, a loss of export markets, coupled with economic mismanagement, have left Argentina far behind the world’s developed countries in terms of wealth levels. The ISA October 2017 Argentina Country Report 18

Social Classes Breakdown Chart: % of Population by Social Class Chart: % of Households by Earnings Social Class A: High Income Professionals Social Class B: Upper-Mid Class Professionals Social Class C: Lower-Mid Class Professionals Social Class D: Poor Source: Survey data The last economic crisis completely disrupted Argentina’s social class structure and reduced a large section of the population to poverty. In fact, the total number of people living in poverty grew by more than 500% over the past 15 years and is only now beginning to fall as Argentina’s economic recovery continues. The ISA October 2017 Argentina Country Report 19

Keys to Economic Growth in Argentina Key Factors Exchange Rate Fluctuations Growing Export Revenues Rebuilding Domestic Consumer Confidence The Argentine economy will continue to recover from its recent collapse, thanks in large part to new export opportunities. Prices for Natural Resource and Agricultural Exports The economic recovery must reach all segments of Argentine society in order to prevent a further increase in crime and corruption. To do this, jobs must be created and it will be foreign investments and exports that provide for this job creation. The ISA October 2017 Argentina Country Report 20

Argentina: GDP Growth Outlook Chart: GDP Growth Rates Current Outlook: • Argentina has experienced wild fluctuations in economic growth over the past decade. Source: ISA Economic Forecasts, national statistics • In recent years, growth has slowed sharply once again as dangerously high inflationary pressures have weakened domestic demand. Future Outlook: • GDP growth will be weak at best over the nearterm as export demand remains weak and high inflation curbs domestic demand growth. • Moreover, Argentina’s economic imbalances could result in much lower rates of economic growth later in the forecast period. The ISA October 2017 Argentina Country Report 21

Argentina: Key Economic Sector Agriculture Summary: Argentina has one of the world’s largest exportoriented agricultural sectors. • Beef, sheep, soya and grains are exported throughout the world. • Argentina competes with the United States, Canada and Australia in each of these sectors. Argentina is one of the world’s leading exporters of beef. • Demand for Argentine beef exports continues to rise, but climatic conditions in Argentina have led to an uneven performance for the sector in recent years. • Furthermore, competition from Brazil has had a major impact on Argentina’s beef exports. Outlook: Argentina’s agricultural sector has withstood the recent economic crisis better than most and is set to grow as export potential expands. • However, the struggles of the country’s beef sector highlight the threat of competition from Brazil and other major agricultural sectors. The ISA October 2017 Argentina Country Report 22

Argentina: Key Economic Sector Manufacturing Summary: Argentina has South America’s second-largest manufacturing sector, after Brazil. • Food processing and textiles were traditionally the main sectors. • However, steel, automobiles and other heavy industry sectors have expanded in recent decades. The manufacturing sector suffered from the collapse of the domestic market during the previous economic crisis. • However, lower production costs have allowed the sector to rebound in recent years thanks to higher export levels. Outlook: Source: OICA Like the agricultural sector, Argentine manufacturing has the potential to enjoy significant export growth. • However, Argentina will have to compete with numerous other candidates for export-oriented foreign investment, such as China, South Africa, Brazil and Mexico. • Argentina’s skilled labor force could prove to be a critical advantage. The ISA October 2017 Argentina Country Report 23

Argentina: Industrial Production Growth Outlook Chart: Industrial Production Growth Rates Source: ISA Economic Forecasts, national statistics Current Outlook: • Industrial production growth rates trended downwards in recent years, with export demand weakening during this period, leading to lower levels of industrial production. Future Outlook: • Argentine industries will continue to struggle in the coming years as they attempt to compete with international competitors. • This competition from China, Brazil and Mexico will make it difficult for Argentine manufactured exports to gain access to key export markets. The ISA October 2017 Argentina Country Report 24

Manufacturing Location Rankings by in Latin America Chart: Manufacturing Location Rankings Current Situation: • With the exception of Mexico, Latin American countries have struggled to develop major manufacturing industries that continue to expand in the 21 st century. • A key problem facing the region is export competitiveness, due to poor infrastructures and a lack of access to key export markets. Future Situation: • Latin America’s recent economic woes have stunted domestic market growth in the region, and this has hurt many of the region’s main manufacturing industries. Scoring: All categories have a score of between 1 and 5, with 1 being the lowest and 5 being the highest The ISA October 2017 Argentina Country Report • Moreover, with the exception of Mexico, it is unlikely that the region will be able to develop competitive exportoriented manufacturing industries in the coming years. 25

Argentina: Retail and Consumer Market Overview Chart: Retail Sales Growth Chart: Disposable Income Source: ISA Economic Forecasts, national statistics Argentina’s retail sector grew at a strong pace in recent years, but the country’s current economic woes have badly impacted consumer confidence in Argentina. Meanwhile, Argentine consumers remain among the wealthiest in Latin America, although they have lost ground to their counterparts in most other large emerging markets. The ISA October 2017 Argentina Country Report 26

Argentina: Inflation Outlook Chart: Inflation Rates Source: ISA Economic Forecasts, national statistics Current Outlook: • Inflation remained high in recent years due in large part to higher levels of consumer spending that have been fuelled by the growth of the money supply as well as the sharp rise in food and energy prices. • Moreover, the previous government had been under-reporting inflation rates in recent years, with actual inflation rates likely being as much as three times above reported levels. Future Outlook: • Inflationary pressures will remain dangerously high over the near-term before easing later in the forecast period. The ISA October 2017 Argentina Country Report 27

Argentina: Foreign Trade Overview Chart: Leading Trade Partners Chart: Current Account Balance Source: ISA Economic Forecasts, national statistics Export growth fell significantly in recent years as both manufactured and agricultural exports have fallen from their earlier highs. Unless Argentina can improve its export competitiveness, it will continue to struggle to compete with key exporting emerging markets such as China or Mexico. The ISA October 2017 Argentina Country Report 28

Argentina: Foreign Investment Chart: FDI Inflows Foreign Investment Climate: Argentina continues to fail to attract significant amounts of foreign investment. • While the domestic market will remain weak over the coming years, export opportunities abound. • The mining and agricultural sectors have attracted more investment. Many companies are still wary of investing in Argentina. • The labor market remains volatile, deterring investment in the manufacturing sector. • The government’s call for more state involvement in the economy is also worrying to many potential investors. Source: UNCTAD Outlook For Future Foreign Investment: Foreign investment levels are not forecast to rise significantly due to the economic slowdown and the lack of economic reform in Argentina. • Moreover, Argentina will have to compete with China and others for export-oriented foreign investment. • In order to do so, it will need to have full government support for investment incentive programs. The ISA October 2017 Argentina Country Report 29

Regional Foreign Investment Source: UNCTAD Brazil is easily the largest recipient of foreign investment in South America, although its per capita FDI inflows are far below those of most other major emerging markets. Chile is the region’s second-largest recipient of foreign investment and leads the region by a wide margin in terms of per capita FDI inflows. The ISA October 2017 Argentina Country Report

Argentina: Exchange Rates Chart: Exchange Rate with the US Dollar Source: ISA Economic Forecasts, OANDA Chart: Exchange Rate with the Euro Source: ISA Economic Forecasts, OANDA After Argentina’s center-right government lifted the currency controls that had maintained the value of the peso against the US dollar and other major currencies, there was a sharp depreciation of the peso against most major currencies. The ISA October 2017 Argentina Country Report 31

Argentina: Labor Force Chart: Unemployment Rate Labor Force Overview: Argentina’s unemployment rates have fallen from their post-crisis highs in the previous decade. • Unemployment rates are not as high as in earlier years, but the number of long-term unemployed remains very high. Argentina has one of the most skilled and educated work forces in the Americas. • This, combined with the weaker peso, will be a major draw foreign investors in the export sector. Source: ISA Economic Forecasts, national statistics Argentina has one of the most expensive work forces in South America. • This, combined with the strength of the country’s labor unions, has deterred some foreign investment in Argentina. Outlook For the Labor Force: Unemployment rates are forecast to remain relatively high in the coming years. • Moreover, long-term unemployment will remain a major problem in the country and could lead to political unrest in the years ahead. The ISA October 2017 Argentina Country Report 32

Fiscal Policy Overview Chart: Fiscal Balance Current Outlook: • By forcing a settlement of its massive debts, the Argentine government allowed the country to avoid huge fiscal deficits that could have occurred after the recent economic crash. • However, 2014’s default helped to lead to a surge in the government’s budget deficit in recent years. Future Outlook: Source: ISA Economic Forecasts, national statistics The ISA October 2017 Argentina Country Report • With the country’s economic outlook deteriorating, the country’s fiscal deficit is forecast to grow over the near-term. 33

Mercosur Trade Agreement The Mercosur Trade Agreement is the pre-eminent trading group in South America and has four permanent members (Brazil, Argentina, Uruguay, and Paraguay). • Mercosur was created in 1991 by the Treaty of Asuncion. • Mercosur’s first expansion has come about through the membership of Venezuela in 2012. • In addition, an associate member status was created for Chile, Bolivia, Columbia, Ecuador, and Peru. Mercosur is designed to boost free trade between member states, with the ultimate goal of full South American economic integration. • Mercosur has aimed economically to reduce the high tariffs of member countries as well as the income inequalities between the countries. • The agreement also tries to eliminate the technological obstacles limiting member countries from bringing products to the market. • The introduction of Venezuela has increased speculation that Mercosur may begin to act increasingly as a political body rather than exclusively as an economic grouping of countries. Mercosur’s future remains highly uncertain due to uncertainty over future expansion. Moreover, the group’s two leading economies, Brazil and Argentina, have widely divergent views of the objectives of the organization and this could lead to a weakening of Mercosur in the coming years. The ISA October 2017 Argentina Country Report 34

Forecast Assumptions and Risk Assumptions: Risks: A Slight Acceleration in Global Economic Growth After five consecutive years of relatively slow growth, global economic growth will accelerate slightly in 2017, thanks to faster growth in the US and some key emerging markets. Protectionism Weakens Trade and Investment The threat of protectionism in the United States, Europe and many other leading economies could lead to major disruptions to trade and investment, damaging economic growth prospects. Inflationary Pressures Rise After years of deflationary pressures, inflation rates will rise in both developed and emerging markets in the coming months. US Isolationism An isolationist turn by the United States could lead to higher levels of instability in many areas of the world and embolden revisionist powers to aggressively stake territorial claims in their spheres of influence. A Strong US Dollar A stronger US dollar will cause major hardships for many emerging markets, particularly those with high levels of US-dollar-denominated debt. Inflationary Pressures Grow Out of Control Argentina’s economic recovery could be derailed by the continuing high rates of inflation that have been in place in recent years. Inflationary Pressures Persist Argentina’s economy will continue to be negatively impacted by high inflation over the near-term and this will prevent the economy from achieving the rates of growth from previous years. Growing Protectionism Argentina must avoid a new round of protectionism in South America in order to boost needed export growth. The ISA October 2017 Argentina Country Report 35

Argentina: Economic Risk Outlook Current Economic Risk Ratings: Economic Risk Outlook: • Argentina’s economic risk levels remain high, though they having fallen significantly over the past two years. • Inflation remains the greatest threat to Argentina’s economy and must be brought under control in order to avoid yet another recession in the coming years. • In addition, Argentina’s lingering debt problems continue to add to the risk levels facing the country’s economy. Low Risk………………High Risk ISA Risk Ratings – 0. 0 to 1. 9 = Low Risk – 2. 0 to 3. 9 = Low to Moderate Risk – 4. 0 to 5. 9 = Moderate Risk – 6. 0 to 7. 9 = Moderate to High Risk – 8. 0 to 10 = High Risk The ISA October 2017 Argentina Country Report 36

Argentina Demographic and Environmental Outlook The ISA October 2017 Argentina Country Report 37

Argentina: Population Overview Chart: Total Population Chart: Working-Age Population Source: US Census Bureau Argentina’s recent economic woes have raised the possibility of large-scale emigration from the country. Nevertheless, the population should cross the 40 million level by the end of this decade. The ISA October 2017 Argentina Country Report 38

Population Growth By Ten-Year Age Increments Source: US Census Bureau Argentina’s population growth continues to slow, resulting in a gradual aging of the population. The percentage of younger people in Argentina will continue to fall, while the number of people over the age of sixty will increase from over six million today to 13. 5 million by the year 2050. The ISA October 2017 Argentina Country Report 39

Composition of Argentina’s Population Immigration came predominantly from Spain and Italy. • Argentina is also home to more than 500, 000 Middle Eastern immigrants. • It also has Latin America’s largest Jewish population. • In the 20 th century, many immigrants have come from neighboring countries. Spanish is the official language of Argentina. • Italian and a variety of Amerindian languages are also spoken. The Argentine president and vice-president are required by law to be Roman Catholics. • Roman Catholism is by far the leading religion in Argentina. The ISA October 2017 Argentina Country Report 40

Argentina: Leading Urban Centers Chart: Largest Urban Centers Summary: • Buenos Aires is home to more than a third of all of Argentina’s population and the city has become one of the largest in the world. • As Argentina’s population continues to grow, Buenos Aires and other large cities such as Cordoba and Rosario will also see significant population growth. Source: World Gazetteer The ISA October 2017 Argentina Country Report 41

Key Demographic Issue in Argentina Emigration in the Wake of the Economic Crisis Argentina has experienced a significant upswing in emigration in the wake of the economic collapse of 2001. • Over 270, 000 people have emigrated from Argentina since 2001. • The leading destinations for these emigrants are Spain, Italy, the United States and Israel. • Argentina now has one of the highest emigration rates in South America. • Moreover, a high percentage of the population has indicated their desire to emigrate. • This brings the distinct possibility of a severe “brain drain” from Argentina. Source: MORI Argentina was once one of the world’s leading recipients of immigrants, but decades of economic deterioration and political instability have made Argentina a net emigration country. Moreover, with the country’s close ties with Europe and North America, the number of people hoping to emigrate will remain steady over the next few years. The ISA October 2017 Argentina Country Report 42

Argentina: Topography and Climate: Key Environmental Issues: • Few countries in the world have a more diverse topography than Argentina is a world leader in setting targets for the reduction of greenhouse gases. • Nevertheless, much of the legislation associated with these plans has proven to be lax. • The western area of the country is dominated by the Andes Mountains. • The Gran Chaco and the Pampas cover the northern and central area of the country. • The south contains Patagonia which is a dry region of northsouth running steppes. • Argentina has one of the world’s most varied climates. • The northeast is tropical, while the Andes Mountains are cold and snowy at higher elevations. • Lowlands below the Andes are very arid, while the Pampas region has a mild climate with seasonal rains. The ISA October 2017 Argentina Country Report No other country in the world has suffered from holes in the ozone layer as has Argentina. • Parts of southern Argentina have been exposed to these holes, whereas much of the country has experienced significant thinning in the ozone layer. Argentina’s major cities and industrial centers suffer from air and water pollution. • Buenos Aires has eight million cars driving in the city every day. • The grassy Pampas region of central Argentina suffers from high levels of industry-related pollution. 43

Argentina: Demographic and Environmental Risk Outlook Current Risk Ratings: Demographic Risk Outlook: • The threat of large-scale emigration appears to have abated, reducing demographic risk levels for the present. Environmental Risk Outlook: Low Risk………………High Risk ISA Risk Ratings – 0. 0 to 1. 9 = Low Risk – 2. 0 to 3. 9 = Low to Moderate Risk – 4. 0 to 5. 9 = Moderate Risk – 6. 0 to 7. 9 = Moderate to High Risk – 8. 0 to 10 = High Risk • Argentina is increasingly at risk from global warming, though efforts to combat ozone depletion appear to have paid dividends. The ISA October 2017 Argentina Country Report 44

ISA October 2017 Country Report Argentina The ISA October 2017 Argentina Country Report 45