Infrastructure in Argentina Mapped Whitespaces Report

Potential Whitespaces

Here is a list of potential whitespaces in the Argentine infrastructure sector, including their identified market signals and calculated potential addressable market.

1. Decentralized & Resilient Utility Solutions

• Market Signals Identified:
  • Demand Side:
    • Increased demand for reliable energy and water due to unstable grid supply and rising tariffs, affecting households, SMEs, and communities.
    • Households experiencing rolling blackouts and water pressure drops; businesses facing production stoppages.
    • Preference for resilience solutions such as backup power, water storage, and distributed generation.
  • Offer Side:
    • Fragmented current market for integrated decentralized solutions.
    • Need for affordable financing mechanisms (e.g., micro-finance, pay-as-you-go models).
    • Emerging offers in design of integrated distributed energy resource (DER) systems and on-site water solutions.
    • Incipient supply of modular backup systems and compact distributed generation technologies.
    • Early-stage installation and O&M services for on-site resilience.
• Potential Addressable Market:
  • USD 42 million to USD 2,544 million (over 1-3 years).

2. Specialized Mining & Energy (Vaca Muerta) Infrastructure Services

• Market Signals Identified:
  • Demand Side:
    • Strong, ongoing demand for infrastructure directly supporting Vaca Muerta development (pipelines, processing plants, roads, power).
    • Specific needs for infrastructure to support mining projects (access roads, energy, logistics).
    • Export-oriented nature of these sectors creates demand for reliable, high-capacity infrastructure.
  • Offer Side:
    • Presence of large EPC contractors (e.g., Techint, Sacde) for major projects.
    • Potential for specialized SMEs in niche areas due to complexity and scale.
    • IMPSA's potential role in supplying heavy equipment.
    • Need for advanced materials and specialized O&M for critical components.
    • Project finance structures and RIGI framework potential to support investment.
• Potential Addressable Market:
  • USD 3.5 billion to USD 13.75 billion (over 3-5 years).

3. Infrastructure Asset Rehabilitation & Life Extension Services

• Market Signals Identified:
  • Demand Side:
    • Significant stock of existing infrastructure deteriorating due to deferred maintenance and inflation.
    • Drastic cuts in public investment preventing large-scale replacement, shifting focus to maintaining existing assets.
    • End-users prioritizing reliability and quick repairs over new expansion due to service disruptions.
  • Offer Side:
    • Emerging need for advanced asset condition assessment services (e.g., drones, IoT).
    • Fragmented offerings for innovative repair technologies and integrated asset management.
    • Incipient supply of advanced/durable repair materials and technologies.
    • Potential for specialized firms focused on rapid repair and preventive maintenance.
• Potential Addressable Market:
  • USD 300 million/year to USD 4.8 billion/year.

4. "Last-Mile" Connectivity Infrastructure (Digital & Utilities)

• Market Signals Identified:
  • Demand Side:
    • Significant gaps in access to reliable internet, potable water, and sanitation, especially in peri-urban and rural areas.
    • Digital divide hindering education, ag-tech, and telemedicine in remote areas.
    • Over 10 million residents without sewer access, leading to health and environmental hazards.
  • Offer Side:
    • Traditional large-scale network expansion often uneconomical for low-density areas.
    • Emerging planning for last-mile solutions and design of cost-effective expansion for underserved areas.
    • Micro-finance or community-based financing models are incipient.
    • Supply of reliable, low-maintenance equipment for decentralized systems is emerging.
    • Turnkey solutions for deploying decentralized utility systems are appearing.
• Potential Addressable Market:
  • USD 82.5 million to USD 1.2 billion (over 3-5 years).

5. Private Sector Project Facilitation & De-risking Services

• Market Signals Identified:
  • Demand Side:
    • Private investors and developers facing high uncertainty, complex permitting, and financing challenges in the current Argentine environment.
    • Need for support to navigate specific opportunities like RIGI, Vaca Muerta, or niche real estate.
    • Contractors facing payment delays and financial risks on public projects, increasing demand for risk mitigation.
  • Offer Side:
    • Existing legal and financial advisors, but a gap for integrated project development services tailored to Argentina's risk landscape.
    • Emergence of new investment promotion frameworks like RIGI requiring specialized navigation.
    • Need for specialized advisory for project re-prioritization and viability in austerity.
    • Demand for enhanced project risk assessment and mitigation planning services.
• Potential Addressable Market:
  • USD 25 million to USD 600 million (over 2-4 years).

6. Sustainable and Climate-Resilient Infrastructure Solutions

• Market Signals Identified:
  • Demand Side:
    • Growing (though currently secondary to economic crisis) global and local awareness of climate change impacts (floods, droughts, extreme weather).
    • Potential future access to international climate finance and alignment with ESG investment trends.
    • Need for infrastructure to be both low-carbon and resilient to unavoidable climate shocks.
  • Offer Side:
    • Limited local expertise and supply chains for green building materials and climate-resilient design.
    • Incipient design of energy/water efficient infrastructure and "pro-poor" infrastructure solutions.
    • Financing mechanisms like green bonds or social impact bonds are emerging ideas.
• Potential Addressable Market:
  • USD 100 million/year to USD 1.5 billion/year (under improved conditions, representing potential future market size).

References

• BBVA Research - Argentina: financiando la brecha de infraestructura. (https://www.bbvaresearch.com/publicaciones/argentina-financiando-la-brecha-de-infraestructura/)
• BNamericas - Los proyectos de infraestructura detenidos en Argentina. (https://www.bnamericas.com/es/noticias/proyectos/los-proyectos-de-infraestructura-detenidos-en-argentina)
• Construmis - Desafíos para el 2025 en el sector de la construcción: 120 mil empleos perdidos y una lenta recuperación en marcha. (https://www.construmis.com.ar/desafios-para-el-2025-en-el-sector-de-la-construccion-120-mil-empleos-perdidos-y-una-lenta-recuperacion-en-marcha/)
• El Economista - Rocca elogió los progresos de Milei, pero advirtió: "Hoy Argentina tiene entre 10 y 20 veces la conflictividad de otros países". (https://eleconomista.com.ar/2024-09-paolo-rocca-logro-progresos-milei-advirtio-argentina-tiene-10-20-veces-conflictividad-otros-paises/)
• Fundación de Investigaciones Económicas Latinoamericanas - ARGENTINA: INFRAESTRUCTURA, CICLO Y CRECIMIENTO. (https://www.fiel.org.ar/publicaciones/informe-de-infraestructura-fiel-argentina-junio-2023)
• Política Argentina - Los detalles de la primera privatización de Milei: IMPSA pasó a manos privadas con una única oferta. (https://www.politicaargentina.com/notas/202405/56156-los-detalles-de-la-primera-privatizacion-de-milei-impsa-paso-a-manos-privadas-con-una-unica-oferta.html)
• Verte - Loma Negra podría volver a manos nacionales. (https://www.verte.tv/noticia/loma-negra-podria-volver-a-manos-nacionales-19546)
• Value Chain Analysis of the Infrastructure in Argentina. (Internal Document)
• Infrastructure in Argentina Current and Future Opportunities Analysis. (Internal Document)
• Infrastructure in Argentina Ongoing Changes Signals Analysis. (Internal Document)
• Infrastructure in Argentina Current Pains Analysis. (Internal Document)
• Infrastructure in Argentina Consumption Trends Analysis. (Internal Document)
• Infrastructure in Argentina Niche and Emerging Markets Analysis. (Internal Document)