Approval of the Framework Agreement for Cooperation in Economic and Investment Fields between Argentina and the People's Republic of China

On July 18, 2014 the authorities of Argentina and the People's Republic of China signed a Framework Agreement on Cooperation in Economic and Investment Fields (the "Framework Agreement") in the City of Buenos Aires. This Framework Agreement was ratified by the National Legislature by the approval of aforementioned Law No. 27,122.

The Framework Agreement establishes a pledge of general economic cooperation between the two countries, which will be implemented through new agreements, contracts, programs or projects, and it envisions the promotion of Chinese companies’ investments in Argentina that increase the local industrial production in potential export sectors to the Chinese market (giving priority to the energy, minerals, manufactured goods, agriculture and support systems markets).

Regarding infrastructure, the Framework Agreement establishes that both parties will sign a five-year Integrated Plan, under which acquisitions directly awarded to Chinese companies may be accepted for public sector projects provided that those companies are subject to concessional financing from China and contracts are awarded with the most advantageous price and quality terms.

The Framework Agreement also envisions facilities for nationals of the other party engaged in for profit activities on “equal conditions” in labor and professional matters provided that work and residence permits have been granted.

Based on this favorable framework for companies from China, it is expected that Argentina will continue increasing public sector projects involving Chinese companies.