Former US ambassador Noah Mamet is back in Argentina and he’s returned with a laundry-list of big-name clients, hoping to deepen foreign investment in the country.
Utilising his knowledge and connections, Mamet has spent the past week meeting with government officials and business players, preaching the advantages of investing in Argentina’s stuttering economy and lauding the reforms of President Mauricio Macri’s administration.
“What I had promised President Macri and others is that I would move back and live part-time here in Argentina, go back to the private sector, but continue to do everything I could to help Argentina, because I’m such a big believer in the country and the direction of the country,” Mamet said in an interview with Times this week in Buenos Aires. “There’s been big challenges. But I said I would continue to bring investors to Argentina and help Argentine companies expand into the United States and other countries around the world.”
Now working with both his own firm and as a consultant for the massive international law firm DLA Piper, Mamet is advising mega-corporations like Amazon, Disney and McDonalds, while hoping to corral investment into Argentine industry, from beef, tourism, wine and renewable energy.
On tech, Mamet revealed Amazon is considering deepening its investment in Argentina, mulling in the coming years whether or not to build the largest data centre in Latin America here.
Mamet maintained, however, that the final word on the creation of a new data centre ultimately rests with the company.
While Amazon has not revealed any future investment plans, the company has committed to opening an “Edge” centre in the province through Amazon Web Services (AWS), its hugely successful wing. The move, confirmed earlier this year by the global tech giant, will improve the speed and quality of the cloud system in Argentina.
“This new effort they’ve announced will be over a US$40-million investment, and it could lead to a larger investment,” Mamet told the Times. “They’re continuing to study whether or not to do a very large-scale data centre, which would be the largest in Latin America and they are very serious in looking at Argentina.”
AWS’ revenue in the second-quarter of 2019 rose to US$8.38 billion compared to US$7.7 billion in the first quarter, making it one of Amazon’s most lucrative subsidiaries.
Mamet said Amazon and other tech companies were enticed by Argentina because of its highly-educated work force, widespread knowledge of English and one-hour time difference with the east coast of the United States.
“You don’t have some of the other inherent challenges when it comes to other industries, because you just don’t have export-import issues as much,” he said. “Data centre companies look at Argentina as a good place to be. That sector in general is growing and potentially, it could grow dramatically."
Mamet also highlighted Disney, another client and major investor in Argentina. The entertainment giant has a sizeable office in the provincial city of Pilar, where the majority of Disney's Spanish-language content is exported from. The company translates television, feature film and radio programmes there.
“I don’t think many Argentines realise what a big operation Disney has right here [in Argentina],” Mamet said. “It’s not a theme park, but it’s a very big business.”
Other projects on Mamet’s list include domestic industries like wine and beef. Earlier this week, he met with Mendoza’s provincial government to discuss potential agreements between Argentine and US wine companies that he said could transform the area into a wine tourism “hub,” replicating California’s wine industry.
“What I would like to see are more agreements on agriculture between companies that are in California and Argentina,” Mamet said. “Right now, any agriculture company, no matter what products you do, you can only supply half the year. But if we have joint agreements between US and Argentine companies, they could then supply year-round. That’s one of the things we’re working on now.”
The former US envoy is also embracing the Macri administration’s initiative to internationalise the local beef industry. With the first shipment of Argentine beef arriving to the west coast of the United States this weekend after a 17-year stall in exports, Mamet – who helped negotiate the early phases of a deal during the Barack Obama administration – called the local beef industry a “huge opportunity” for investors.
“The first-year quota is 20,000 tons that is allowed to the US,” Mamet said. “That could and should grow in the future. That’s the first year.”
In September, the ex-ambassador will host an event in Los Angeles alongside local celebrity chef Francis Mallmann to promote the expansion of Argentine beef on the west coast.
Since Macri took office, Argentina has gone from the 17th largest exporter of beef worldwide to the 8th, and a recent bilateral trade agreement on beef exports agreed between Macri and US President Donald Trump could be worth US$150-180 million.
“They really had to recreate the industry that was decimated under Cristina,” Mamet added, referring to former president Cristina Fernández de Kirchner.
Eye on renewables
Mamet's other top Argentine industry is renewable energy, which has seen US$7.2 billion in investments from private companies over the last year. Argentine law directs that 20 percent of the country's energy should come from renewable sources by 2025.
"When I arrived here in January 2015, YPF told me that less than one percent of the energy came from renewables. I was shocked," Mamet said. "It is the future of Argentina in many ways, like other countries that have good wind and good sun."
Mamet also told the Times that he has worked with Arcos Dorados, McDonald’s largest holding franchise in Latin America, on “industrial-size commercial batteries” in Brazil. The batteries, which are charged at night, are intended to power McDonalds’ stores during their peak hours of 4pm to 8pm.
“It’s called peak shaving, which has never been done at any McDonald's around the world,” Mamet added, revealing he and the Buenos Aires-based Arcos Dorados will announce more about the project next week in Brazil.
While Mamet wouldn’t discuss how he saw the climate for investors under a potential government led by opposition candidate Alberto Fernández, the former ambassador commended Macri’s economic reforms, comparing them to unpopular, but in his view, necessary fiscal reforms carried out by former US presidents Bill Clinton and Barack Obama.
“They lost Congress in the next election, by historical margins, yet they won re-election because people started to feel the positive change,” Mamet said, drawing a comparison. “But they really didn’t get the full benefit until the second term. I see similarities here with what I went through twice in the United States.”
Mamet attributed Argentina's economic troubles to external factors beyond the government’s control.
“They also had to clean up a huge mess that they inherited. I give them credit for doing sometimes unpopular things to correct the macro-structure that creates confidence for investors, either from Argentina or internationally,” Mamet said. “Hopefully, in my view, voters can see this directional change. They’ve had to go through a hard time.”