Value Chain Report on the Infrastructure Industry in Argentina.¶

Abstract¶

This report provides a comprehensive analysis of the value chain for the infrastructure industry in Argentina. It details the key stages, including Planning and Design, Financing and Procurement, Material and Equipment Supply, Construction and Execution, and Operation and Maintenance, along with critical Support Activities. The analysis identifies major segments such as Vial Works, Energy, Water and Sanitation, Transport, Edification, Mining, and Communications Infrastructure. Key players, encompassing government entities, large private construction firms (e.g., Grupo Roggio, Rovella Carranza, Sacde, Techint), energy giants (YPF, PAE), material suppliers (Loma Negra), equipment manufacturers (IMPSA), and operators (CAAP), are profiled, alongside estimates of their scale where available. The report examines the complex commercial relationships, business models (including contracting, concessions, and fee-based services), and the flow of products and services along the chain. Crucially, it highlights the severe bottlenecks and challenges currently confronting the sector, dominated by drastic cuts in public investment, pervasive economic instability (inflation, devaluation), significant financing difficulties, chronic payment delays in public works, regulatory hurdles, and overarching political uncertainty. These challenges profoundly impact all stages of the value chain, leading to project suspensions, job losses, and hindering the sector's contribution to national development.

Introduction¶

The infrastructure industry in Argentina serves as a critical foundation for the nation's economic functioning and the quality of life of its population. It encompasses the development, construction, operation, and maintenance of essential physical systems and facilities, including transportation networks (roads, railways, ports, airports), energy generation and distribution systems, water supply and sanitation infrastructure, communication networks, and various public and private buildings. Effective and efficient infrastructure facilitates trade, connects regions, enables industrial activity, and provides essential services, making its analysis crucial for understanding economic potential and developmental challenges.

The purpose of this report is to conduct an in-depth value chain analysis of the Argentine infrastructure sector. It aims to dissect the sequential and interconnected activities involved in bringing infrastructure projects from conception to operation and beyond. The scope includes defining the distinct steps and segments within the value chain, identifying the key actors involved (public and private), analyzing their commercial interactions and the business models they employ, and critically evaluating the major bottlenecks and challenges that impede the sector's performance and development. By providing a detailed, granular view of the value chain, this report seeks to offer valuable insights for stakeholders, policymakers, investors, and industry participants navigating this complex and currently challenged sector.

Value Chain Definition¶

The infrastructure value chain in Argentina represents the sequence of activities required to deliver and maintain infrastructure assets and services. While varying slightly depending on the specific type of infrastructure (e.g., a highway versus a power plant), a generalized model applicable across the sector includes the following core steps:

Planning and Design: This initial phase involves identifying infrastructure needs based on public policy goals, economic development strategies, or private sector demand. Activities include conducting comprehensive feasibility studies (technical, economic, environmental, social), preliminary and detailed project design, engineering specifications, environmental impact assessments, and securing necessary permits and regulatory authorizations from various governmental levels. This stage sets the foundation for the project's scope, cost, and timeline.
Financing and Procurement: This crucial step focuses on securing the necessary capital to fund the project and establishing the contractual framework for its execution. Financing can originate from diverse sources: public funds (national, provincial, municipal budgets), loans from multilateral or bilateral development institutions, private equity investments, corporate or project finance from banks, or capital markets instruments. For public works, this stage involves the procurement process, typically through competitive public tenders, to select contractors and major suppliers based on technical and economic criteria. This stage establishes the financial viability and contractual basis for the project.
Material and Equipment Supply: This stage encompasses the production, sourcing, and delivery of all physical inputs required for construction. It involves the extraction and processing of raw materials (aggregates, ores) and the manufacturing of construction materials such as cement, concrete, steel products (rebar, structural steel), asphalt, pipes, bricks, glass, etc. It also includes the manufacturing or importation, and supply of specialized equipment, ranging from heavy construction machinery (excavators, cranes) to highly specific components for energy (turbines, generators, transformers), water (pumps, treatment systems), transport (rail signaling, airport navigation systems), and communication infrastructure (fiber optics, transmission gear). This step has strong linkages to other industrial value chains (e.g., cement, steel, manufacturing).
Construction and Execution: This is the physical implementation phase where the infrastructure asset is built. Activities include site preparation (clearing, excavation, grading), civil engineering works (foundations, structures, paving, tunneling), installation of mechanical and electrical systems, network deployment (pipelines, cables, tracks), building erection, and finishing works. Effective project management is critical during this stage to coordinate labor, materials, equipment, and subcontractors, ensuring adherence to timelines, budgets, quality standards, and safety regulations. This phase is often the most capital-intensive and visible part of the value chain.
Operation and Maintenance (O&M): Once constructed, infrastructure assets require ongoing activities to ensure they function effectively, safely, and deliver the intended services throughout their lifecycle. Operation involves managing the day-to-day functioning of the asset (e.g., managing traffic flow, operating power plants, distributing water/energy, managing airport/port logistics). Maintenance includes routine inspections, preventative upkeep, repairs, rehabilitation, and upgrades to preserve the asset's condition and extend its useful life. O&M can be carried out by public entities, state-owned enterprises, or private operators under concession agreements or service contracts.
Support Activities: Underpinning all primary steps are various essential support activities. These include overall infrastructure management and planning, human resources management (recruitment, training), technology development and adoption (IT systems, specialized software), procurement support, logistics and supply chain management, legal and regulatory advisory, financial management and accounting, and public relations.

Segments and Activities¶

Within these value chain steps, the industry can be segmented by the type of infrastructure:

Vial Works: Construction, rehabilitation, and maintenance of roads, highways, bridges, tunnels, and overpasses. Activities: Earthmoving, paving (asphalt, concrete), bridge construction, signage, drainage systems.
Energy Infrastructure: Development of power generation (thermal, hydro, nuclear, wind, solar), electricity transmission and distribution networks, oil and gas pipelines, LNG terminals, refineries, and related facilities. Activities: Power plant construction, turbine installation, laying high-voltage lines, pipeline welding and installation, building compression/pumping stations.
Water and Sanitation Infrastructure: Construction and management of potable water supply networks, water treatment plants, sewage collection systems, wastewater treatment plants, dams, and irrigation canals. Activities: Pipe laying, treatment plant construction, reservoir building, pump station installation.
Transport Infrastructure (non-vial): Development and operation of airports (terminals, runways), railways (tracks, stations, signaling), ports (docks, terminals, dredging), and urban transit systems (subways). Activities: Terminal construction, runway paving, track laying, port dredging, signaling system installation.
Edification/Building Infrastructure: Construction of residential, commercial, industrial, institutional (hospitals, schools), and public buildings. Activities: Foundation work, structural erection (concrete, steel), facade installation, interior finishing, MEP (Mechanical, Electrical, Plumbing) systems installation.
Mining Infrastructure: Development of specific infrastructure to support mining operations, including access roads, dedicated rail lines, slurry pipelines, power supply infrastructure, water management systems, and export port facilities. Activities: Heavy-duty road construction, rail spur development, high-voltage line construction to remote areas, port terminal construction for bulk minerals.
Communications Infrastructure: Deployment of fixed-line and mobile telecommunication networks, including fiber optic cables, cell towers, data centers, and satellite ground stations. Activities: Fiber optic cable trenching and laying, cell tower erection, network equipment installation.

Value Chain Summary Table¶

Value Chain Step	Key Segments	Types of Players	Main Activities	Volume/Size Estimates (where available)
Planning and Design	All infrastructure types (Vial, Energy, Water, Transport, Edification, Mining, Comms)	Engineering & Design Firms, Government Entities, Developers	Identifying needs, feasibility studies, project design, securing permits.	Largely dependent on downstream investment decisions; currently reduced due to public spending cuts.
Financing & Procurement	All infrastructure types	Government Entities, Private Investors, Banks, Multilateral/Bilateral Institutions	Securing funds, tendering contracts, managing financial instruments (PPPs, concessions).	Public investment fell drastically (73.4% real drop in 2024). RIGI framework aims for USD 15.2B+ private investment. Significant financing challenges persist.
Material & Equip. Supply	All infrastructure types	Material Producers (Cement, Steel, etc.), Equipment Manufacturers/Suppliers, Importers	Extracting raw materials, manufacturing construction materials (cement, steel, asphalt), producing/supplying specialized machinery & components.	Loma Negra dispatched 6.4M tons cement (2023). Costs impacted by inflation/devaluation.
Construction & Execution	Vial, Energy, Water, Transport, Edification, Mining, Comms Infrastructure	Construction Companies (Large, Small, JVs), Specialized Contractors, SOEs	Physical building of assets, site prep, installation of networks/structures, project management.	ISAC index fell 21.7% (Jan 2024). >120k jobs lost (mid-2023 to mid-2024). Public works component fell 73.9% (2024). Rovella Carranza backlog ~USD 526M (May 2023).
Operation & Maintenance	Energy, Water, Transport, Communications Infrastructure	Infrastructure Operators (Public, Private/Concessionaires, Mixed), Maintenance Contractors	Managing service delivery (transport, utilities), network monitoring, repairs, upgrades, routine upkeep.	CAAP handled 32M passengers/yr in Argentina (2018 data). Metrovías handled 324M passengers (2016 data). Often long-term concession agreements.
Support Activities	All infrastructure types	Consulting Firms, Technology Providers, HR Services, Logistics Companies, Law Firms	Infrastructure management consulting, HR, technology implementation, procurement services, logistics, legal/regulatory support.	Activity levels tied to overall industry health; currently impacted by downturn.

Players Analysis¶

The Argentine infrastructure value chain involves a diverse array of players, each contributing specialized capabilities and interacting within specific market segments and value chain steps. These can be broadly categorized as follows:

Government/Public Sector Entities:
- National, Provincial, and Municipal Governments: Act as primary clients for public works, policymakers setting infrastructure priorities, regulators establishing standards, and sometimes direct operators of infrastructure assets. The Ministry of Public Works (MOP) is a central entity for planning, financing, and overseeing national public infrastructure projects.
- State-owned Enterprises (SOEs): Entities like YPF (dominant in the energy sector, involved in exploration, production, refining, transport, and downstream), Trenes Argentinos Cargas/Operaciones (rail freight and passenger transport), and formerly IMPSA (now majority private but with state history, crucial in energy equipment) play significant roles as developers, operators, and clients within their specific domains.
- Regulatory Bodies: Various agencies responsible for setting technical standards, tariffs, environmental regulations, and overseeing the operation of specific infrastructure sectors (e.g., ENRE for electricity, ENARGAS for gas).
Private Sector Companies:
- Construction Companies/Contractors: The core executors of physical construction. This includes large, diversified national groups like Grupo Roggio (Benito Roggio e Hijos) and Techint Group (often operating through subsidiaries), major construction firms like Rovella Carranza and Sacde (part of Pampa Energía), and numerous small and medium-sized enterprises (SMEs), often specializing in specific types of work or acting as subcontractors. Joint ventures (UTEs - Unión Transitoria de Empresas) are common for large-scale projects. CAMARCO (Cámara Argentina de la Construcción) represents the interests of these firms.
- Engineering and Design Firms: Provide specialized technical services for planning and design stages. These can range from large international consultancies to specialized local firms.
- Material Suppliers: Companies producing essential inputs. Loma Negra dominates the cement market. Steel producers (like Tenaris, part of Techint Group), aggregate suppliers, asphalt producers, and manufacturers of other building materials are vital.
- Equipment Manufacturers and Suppliers: Includes domestic manufacturers like IMPSA (specializing in large turbines for hydro, wind, nuclear; process equipment) and suppliers/importers of heavy construction machinery and specialized components for various sectors.
- Infrastructure Operators: Private companies that manage and operate infrastructure assets, often under long-term concession agreements. Corporación América Airports (CAAP) is a prime example, operating a majority of Argentina's major airports. Entities within Grupo Roggio operate transport (subway) and water services. Other private companies operate highway concessions or participate in energy distribution.
- Developers: Private entities that initiate, finance, and manage infrastructure projects, particularly in real estate (residential, commercial, industrial buildings) and potentially in energy or mining-related infrastructure driven by private investment.
- Financial Institutions and Investors: Local and international banks, investment funds, insurance companies, and potentially philanthropic capital providers that supply debt and equity financing for projects.
International Organizations: Multilateral development banks (e.g., World Bank, Inter-American Development Bank) and bilateral agencies provide significant financing and technical assistance, particularly for large public infrastructure projects, often linked to specific development goals or policy reforms.

Key Player Profiles & Scale:¶

Pan American Energy (PAE): A leading integrated energy company (oil & gas exploration, production, refining, distribution). Significant player in Vaca Muerta development and associated pipeline infrastructure (e.g., Vaca Muerta Oil Sur pipeline). Produces ~247 MMBOED and operates over 735 service stations. Annual revenue estimated around USD 7.3 billion (as Pan American Energy Group).
YPF: Argentina's largest company and state-controlled energy giant. Dominant in oil and gas production, refining, and fuel retail. Key driver of Vaca Muerta development and major pipeline projects (e.g., Gasoducto Presidente Néstor Kirchner). Non-conventional oil production (largely YPF-driven) exceeded 410,000 bpd in Oct 2024. Its subsidiary AESA is a major engineering and construction player, especially in energy facilities.
Loma Negra: The leading cement producer in Argentina, crucial for the construction phase across all segments. Operates multiple plants and a logistics network including rail. Dispatched 6.4 million tons of cement in 2023. Production capacity around 7.5M tons/year (cement) and 700k m³/year (concrete, 2005 data). Employs ~2,900 people (Sept 2024). Part of Brazil's InterCement group (formerly Camargo Correa).
Corporación América Airports (CAAP): Major private airport operator, managing 36 airports in Argentina under concession. Handles significant passenger volume (reported 32 million annually in 2018). Business model relies on aeronautical fees and commercial revenues within terminals. Listed on the NYSE.
Grupo Roggio (Benito Roggio e Hijos): A large, diversified conglomerate with a long history. Its construction arm (Benito Roggio e Hijos) is a major player in public works (especially roads). Operates Metrovías (Buenos Aires subway, ~324 million passengers in 2016) and Urquiza railway line, water/environmental services. Broad involvement across construction and operation stages.
Rovella Carranza: A significant construction company focused primarily on public works, particularly road construction, bridges, and other large civil engineering projects. Had a substantial project backlog reported at $131 billion pesos (approx. USD 526 million) as of May 2023.
IMPSA: Historically a major state-linked (now majority private via tender) manufacturer of capital goods, specializing in large equipment for hydroelectric power plants (turbines, generators), wind energy components, nuclear components, and process equipment (e.g., reactors for refineries). Produced its 200th turbine by 2019. Employs around 700-750 people. Crucial domestic supplier for specialized energy equipment.
Sacde (Sociedad Argentina de Construcción y Desarrollo Estratégico): Construction company belonging to the Pampa Energía group. Heavily involved as a key contractor in major energy infrastructure projects, particularly gas pipelines originating from Vaca Muerta, often in consortium with Techint.
Techint Group: One of Argentina's largest and most diversified industrial conglomerates. Significant presence in infrastructure through its engineering and construction divisions (Techint E&C) and steel production (Tenaris, Ternium). Major player in large-scale energy projects (pipelines, power plants) and industrial facilities, often partnering with other large firms like Sacde. CEO Paolo Rocca is a prominent voice on investment climate.

Volumes and Sizes (Context):¶

Quantifying precise market shares or total value for each step is challenging with available data, especially given the current volatility. However, key indicators point to a severe contraction driven by public sector withdrawal:

Public Investment Collapse: Real direct national government investment in provincial infrastructure fell 73.4% in 2024, hitting a 20-year low. Construction's share of this investment also fell 73.9%. This dramatically shrinks the market volume for public works contractors and suppliers.
Construction Activity: The ISAC index showed a 21.7% year-on-year decline in January 2024, indicating a sharp drop in execution volumes.
Employment Impact: Over 120,000 job losses reported in construction between mid-2023 and mid-2024, and around 4,000 firm closures, reflecting the scale of the downturn.
Private Sector Activity: While public works collapsed, some activity persists in private construction linked to mining, energy (Vaca Muerta), and potentially real estate spurred by specific incentives, but not enough to offset the public decline.
Market Context: The broader Latin American construction market was estimated at ~USD 676 billion in 2024, providing regional scale, but Argentina's specific market size has significantly shrunk from previous years.

Commercial Relationships¶

The commercial interactions within the Argentine infrastructure value chain are diverse, reflecting the project type (public vs. private), the specific stage, and the nature of the players involved. These relationships form the transactional backbone of the industry.

Planning & Design Phase: Government entities (national, provincial, municipal) or private developers initiate projects and engage Engineering and Design Firms. In the public sector, this relationship is typically formalized through public tenders for consulting services, where firms compete based on technical expertise and price. The government acts as the client, contracting the firm to produce feasibility studies, detailed designs, and specifications. In the private sector, developers may select firms based on negotiation, reputation, or prior relationships, leading to more flexible consulting contracts. The deliverable is intellectual property (designs, reports) exchanged for professional fees.
Financing & Procurement Phase: Project sponsors (government or private developers) interact with Financial Institutions (banks, funds) and International Organizations to secure capital. This involves negotiating loan agreements, equity investment terms, or accessing grant funding. The financiers provide capital in exchange for future returns or adherence to development objectives. Concurrently, for projects involving construction, the client (government or developer) engages with potential Construction Companies and major Suppliers through procurement processes. Public procurement relies heavily on formal tenders governed by public law, leading to construction contracts or supply agreements awarded based on defined criteria (often lowest price or best value). Private procurement can be more negotiated. For PPPs or concessions, complex, long-term concession agreements are negotiated between the government and a private consortium (often including financiers, constructors, and operators), defining rights, obligations, risk allocation, and payment mechanisms over decades.
Material & Equipment Supply Phase: Construction Companies act as the primary customers, establishing commercial relationships with Material Producers (e.g., Loma Negra for cement, steel mills) and Equipment Suppliers (e.g., IMPSA for specialized equipment, machinery dealers). These relationships typically involve purchase orders, project-specific supply contracts, or distribution agreements. Transactions are based on agreed prices, quantities, delivery schedules, and quality specifications. Payment terms are usually standard B2B credit, but are often strained by upstream payment delays, particularly from public works clients impacting contractors' ability to pay suppliers promptly.
Construction & Execution Phase: The core relationship here is between the Client (government entity, SOE, private developer) and the Construction Company/Contractor(s). This is governed by the construction contract (e.g., fixed-price, cost-plus, unit-price, EPC) established during procurement. The contractor provides construction services (labor, site management, execution) in exchange for progress payments based on milestones achieved. For large projects, Joint Ventures (JVs or UTEs) create formal commercial agreements between participating construction companies, outlining responsibilities, profit/loss sharing, and governance. Contractors, in turn, establish subcontracting agreements with specialized firms for specific tasks (e.g., electrical work, earthmoving), extending the web of commercial relationships.
Operation & Maintenance Phase: For privately operated infrastructure (e.g., concessions), the key relationship is between the Government (Grantor) and the Private Operator (Concessionaire), defined by the concession agreement. The operator manages the asset and provides services (e.g., airport operations by CAAP, highway operation by a toll road company) in exchange for the right to collect user fees (tolls, tariffs, airport charges) or receive availability payments from the government. The agreement specifies performance standards, investment obligations, revenue sharing, and duration. For publicly operated assets, the government entity might directly manage operations or engage Maintenance Contractors through service agreements for specific upkeep tasks, paying fees for services rendered.
Support Activities: All primary players engage with providers of ancillary services. These involve standard B2B service contracts with Consulting Firms, Law Firms, Technology Providers, Logistics Companies, and HR Agencies, typically based on fees for services, retainers, or project-based pricing.

Bottlenecks and Challenges¶

The Argentine infrastructure value chain is currently facing a confluence of severe bottlenecks and deep-rooted challenges that significantly constrain its activity and potential. These issues permeate all stages of the value chain:

Drastic Reduction in Public Investment: The sharp decline in real public works spending implemented in 2024 represents the most immediate and impactful bottleneck. [Construmis - Desafíos para el 2025...] As the government is historically the largest client, this paralyzes demand in the Construction & Execution stage, leading to project suspensions and cancellations. [BNamericas - Los proyectos de infraestructura detenidos en Argentina] This directly impacts Material Suppliers and Equipment Providers due to plummeting orders, and halts activity in the Planning & Design stage as the pipeline of new public projects dries up. The massive job losses (>120,000) are a direct result.
Pervasive Economic Instability: Chronic high inflation, currency devaluation, and recession create profound challenges. Inflation wreaks havoc on project budgets and pricing, especially for Construction Companies locked into fixed-price or inadequately indexed contracts, leading to financial distress and disputes. It complicates cost estimation in the Planning & Design stage. Devaluation sharply increases the cost of imported machinery and components, impacting the Material & Equipment Supply stage and overall project feasibility, particularly for complex energy or industrial projects. Recession dampens private sector demand (e.g., for new buildings) and further restricts government fiscal space for investment. [El Economista - Rocca elogió los progresos de Milei...]
Financing Constraints: Accessing affordable, long-term financing is a major bottleneck affecting the Financing & Procurement stage. High sovereign risk perception makes international borrowing expensive and difficult for both the government and private sector. [BBVA Research - Argentina: financiando la brecha de infraestructura] Domestic capital markets are shallow, and anti-inflationary monetary policy leads to high interest rates, limiting local financing options. This hinders the launch of new projects, particularly large-scale ones requiring substantial upfront capital, and makes models like PPPs difficult to implement without robust guarantees or significantly higher expected returns to compensate for risk.
Payment Delays in Public Works: A persistent historical issue where government entities delay payments to contractors for certified work completed. This creates severe working capital shortages for Construction Companies, forcing them into costly short-term financing, delaying payments to their own Material Suppliers and subcontractors, and potentially leading to a slowdown or halt in Construction & Execution. This damages trust and increases the risk premium contractors build into bids.
Regulatory and Bureaucratic Hurdles: Complex, slow, and sometimes unpredictable administrative processes for obtaining permits, environmental licenses, and other approvals create bottlenecks in the Planning & Design and pre-construction phases. This adds time and cost uncertainty, potentially delaying project starts for months or years. Lack of regulatory clarity or frequent changes can deter investment, especially in regulated sectors like energy or utilities.
Labor Market Disruption: While the current downturn creates labor surplus, the massive layoffs risk dispersing skilled labor pools. [Construmis - Desafíos para el 2025...] When recovery eventually occurs, finding sufficient skilled workers could become a bottleneck for ramping up Construction & Execution. Furthermore, underlying labor relations issues and potential industrial actions add another layer of operational risk. [El Economista - Rocca elogió los progresos de Milei...]
Supply Chain Vulnerabilities: Reliance on imported specialized equipment and components exposes projects to exchange rate volatility, potential import restrictions or delays, and global logistical disruptions, impacting the Material & Equipment Supply step. Domestic supply chains, while robust in areas like cement (Loma Negra), are also affected by the overall economic climate, energy costs, and logistical challenges within Argentina.
Political Risk and Policy Instability: Frequent shifts in government priorities, economic policies, and regulatory frameworks create significant uncertainty across the entire value chain. [Fundación de Investigaciones Económicas Latinoamericanas - ARGENTINA: INFRAESTRUCTURA, CICLO Y CRECIMIENTO] This discourages long-term private investment, particularly affecting Financing decisions and the viability of Concession Models in the O&M stage, which rely on stable conditions over decades. Abrupt policy changes, like halting ongoing public works, undermine confidence and disrupt established commercial relationships and project flows. [BNamericas - Los proyectos de infraestructura detenidos en Argentina]

Value Chain Relationships and Business Models¶

This section synthesizes the interplay between commercial relationships, the products/services exchanged, the business models employed, and how bottlenecks manifest within these interactions along the Argentine infrastructure value chain.

Products and Services Exchanged Along the Chain:¶

The value chain facilitates a flow of diverse products and services:

Intangibles (Early Stages): The process begins with intellectual outputs from Engineering and Design Firms, including feasibility studies, technical designs, blueprints, environmental impact assessments, and regulatory compliance documentation. Financial Institutions provide capital (loans, equity), while clients and contractors exchange legally binding tender documents and contracts (construction, supply, concession agreements).
Tangible Goods (Mid-Stages): The Material and Equipment Supply stage delivers physical goods essential for construction. This includes bulk commodities like cement, aggregates, steel, and asphalt, as well as manufactured items like pipes, bricks, and cables. Critically, it also involves highly specialized items such as turbines (e.g., from IMPSA), generators, transformers, heavy construction machinery, pumps, valves, and sophisticated network equipment. Associated services like logistics, technical support, and installation assistance are often bundled.
Services and Completed Assets (Late Stages): Construction Companies provide the core service of physical construction and project management, transforming designs and materials into a completed infrastructure asset (road, power plant, building, etc.). In the Operation and Maintenance stage, Operators provide ongoing operational services to end-users (e.g., transport, utility distribution, communication access) often in exchange for user fees. Maintenance Contractors provide repair, upkeep, and upgrade services for the physical assets.
Support Services (Throughout): Various essential business services underpin the entire chain, including legal counsel, financial advisory, management consulting, IT solutions, logistics coordination, and human resource management.

Business Models Used in Relationships Between Players:¶

Diverse business models govern how value is created and captured:

Fee-for-Service: Dominant in early stages and support activities. Engineering/Design firms and Consultants charge fees based on time, project value, or deliverables. Lawyers, Accountants, and other professional service providers operate similarly.
Financing Models: Banks use Lending Models (interest income). Investment Funds use Equity/Debt Investment Models seeking capital gains or yields. Project Finance structures are common for large projects, isolating project cash flows to repay dedicated debt and equity.
Manufacturing and Sales: Material Producers (Loma Negra) and Equipment Manufacturers (IMPSA) operate on producing goods and selling them at a margin over cost. This often includes direct sales, distributor networks, and sometimes bundled services (support, installation). Equipment Rental is also a significant model for construction machinery.
Contracting Models: Central to the Construction & Execution stage. Common models include:
- Fixed-Price: Contractor bears cost overrun risk. Common in simpler public works but challenging under high inflation.
- Cost-Plus: Client bears cost risk; contractor gets costs reimbursed plus a fee. Used when scope is uncertain.
- Unit-Price: Payments based on measured quantities of work items at pre-agreed rates. Common in public works like roads.
- EPC (Engineering, Procurement, Construction): Turnkey model where one contractor manages the entire project lifecycle up to commissioning. Common in complex industrial/energy projects.
- Joint Ventures (UTEs): Risk/resource sharing model between multiple contractors for large projects.
Concession Model: Prevalent in Operation & Maintenance for assets like airports (CAAP), highways, and potentially utilities. A private operator receives long-term rights to operate and maintain an asset, investing capital and earning revenue primarily from user fees, under terms set by the government.
Public Operation Model: Government entities or SOEs directly operate infrastructure assets, funded through budgets and potentially user fees.
Service Contract Model: Used for outsourcing specific O&M tasks (e.g., routine road maintenance) to private firms for a fee.

Main Bottlenecks and Challenges in Transactions:¶

The identified bottlenecks directly impact the commercial relationships and transactions within the value chain:

Public Investment Cuts & Payment Delays: Directly impact Client-Contractor relationships in public works. Reduced tenders mean fewer Contracting Model opportunities. Payment delays strain contractor working capital, jeopardizing their ability to fulfill Fixed-Price/Unit-Price contracts and negatively impacting their transactional relationships with Material Suppliers (delayed payments on Sales Model purchases) and Subcontractors.
Financing Constraints: Hinder the initiation of projects, impacting the Financing Model providers (fewer deals) and preventing Client-Contractor relationships from even forming. Makes large Project Finance deals difficult to close and raises the cost of capital for Concession Model operators needing to fund investments.
Economic Instability (Inflation/Devaluation): Creates immense transactional friction. Makes Fixed-Price Contracts highly risky for contractors. Complicates price negotiation in Material/Equipment Sales Models, especially for imported goods. Erodes the real value of payments in long-term Concession Agreements if tariff adjustments lag inflation.
Regulatory/Bureaucratic Hurdles: Delay the activation of Consulting Contracts (Planning/Design) and Construction Contracts, creating uncertainty and cost for all parties awaiting project commencement. Can stall permit-dependent stages within ongoing contracts.
Political Risk/Policy Instability: Undermines the long-term stability required for Concession Models and large Project Finance deals. Investors and operators face the risk that contractual terms (e.g., tariff adjustments, investment requirements) might be altered mid-stream, severely impacting the viability of their Business Models and trust in Government-Private Operator relationships. Sudden project halts disrupt all existing transactional agreements related to that project.

Conclusion¶

The value chain of Argentina's infrastructure industry is a complex ecosystem involving multiple stages, diverse segments, and a wide range of public and private actors. From initial planning and securing finance, through material supply and physical construction, to long-term operation and maintenance, the chain relies on intricate commercial relationships governed by various business models, including contracting, concessions, fee-based services, and financing structures. Key players like YPF, PAE, Loma Negra, Grupo Roggio, Techint, and CAAP play pivotal roles within specific segments or across multiple stages.

However, the analysis reveals a sector currently facing profound challenges that act as critical bottlenecks across the value chain. The drastic reduction in public investment has crippled demand, leading to widespread project cancellations, company closures, and significant job losses. This is compounded by deep-seated macroeconomic instability—high inflation and currency volatility—which complicates financing, erodes contract values, and increases operational risks. Persistent difficulties in accessing affordable long-term finance, chronic delays in government payments to contractors, burdensome bureaucracy, and overarching political and policy uncertainty further hinder activity and deter much-needed investment. These factors severely strain commercial relationships and undermine the viability of established business models, particularly for long-term investments like concessions.

While Argentina possesses significant infrastructure needs and potential, particularly in energy (Vaca Muerta) and logistics, realizing this potential requires addressing these fundamental challenges. Stabilizing the macroeconomy, restoring fiscal credibility to enable sustainable public investment, improving the predictability and efficiency of regulatory processes, ensuring timely payments, and fostering a stable policy environment are crucial prerequisites for revitalizing the sector. Further research could focus on the specific impacts of emerging policies like the RIGI investment framework, detailed quantitative analysis of bottlenecks within key segments (e.g., energy transport, water infrastructure), and comparative studies on the effectiveness of different business models (e.g., PPPs vs. traditional procurement) in the Argentine context. Overcoming the current paralysis is essential for infrastructure to once again become a driver of, rather than a drag on, Argentina's economic development.

References¶

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/)
La Política Online - Camargo Correa, el gigante brasileño. (https://www.lapoliticaonline.com/nota/46497-camargo_correa_el_gigante_brasileno/)
Infobae - El resurgimiento de Impsa: salida del default, Pescarmona, el impacto de los cuadernos y la turbina número 200. (https://www.infobae.com/economia/2019/10/06/el-resurgimiento-de-impsa-salida-del-default-pescarmona-el-impacto-de-los-cuadernos-y-la-turbina-numero-200/)
Marketscreener - Corporación América Airports S.A.: Segmentos de actividades y Distribución geográfica de la Facturación. (https://es.marketscreener.com/cotizacion/accion/CORPORACION-AMERICA-AIRPORTS--40257031/negocio/)
BNamericas - Los principales proyectos del programa argentino de US$6.500mn de infraestructura estratégica. (https://www.bnamericas.com/es/analisis/los-principales-proyectos-del-programa-argentino-de-us6500mn-de-infraestructura-estrategica)
BNamericas - Los proyectos de infraestructura detenidos en Argentina. (https://www.bnamericas.com/es/noticias/proyectos/los-proyectos-de-infraestructura-detenidos-en-argentina)
El Cronista - Confirmado: la brasileña Camargo Correa compró el 35% de Alpargatas. (https://www.cronista.com/negocios/Confirmado-la-brasilena-Camargo-Correa-compro-el-35-de-Alpargatas-20111123-0062.html)
La Nación - El software aporta a Roggio el 10% de sus ingresos. (https://www.lanacion.com.ar/economia/el-software-aporta-a-roggio-el-10-de-sus-ingresos-nid1280604/)
Diario Río Negro - Contratos y empresas. (https://www.rionegro.com.ar/contratos-y-empresas-961536/)
La Nación - Nace Pan American Energy Group, un holding que facturaría US$ 7.300 millones al año. (https://www.lanacion.com.ar/economia/negocios/nace-pan-american-energy-group-un-holding-que-facturaria-us-7300-millones-al-ano-nid2104169/)
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/)
Urgente24 - Paolo Rocca (Techint): Inversión millonaria, miles de empleos y una advertencia a Javier Milei. (https://www.urgente24.com/energia/paolo-rocca-techint-inversion-millonaria-miles-empleos-advertencia-javier-milei-n584955)
Infobae - Corporación América sale a cotizar sus acciones en los EEUU. (https://www.infobae.com/economia/2018/01/31/corporacion-america-sale-a-cotizar-sus-acciones-en-los-eeuu/)
Verte - Loma Negra podría volver a manos nacionales. (https://www.verte.tv/noticia/loma-negra-podria-volver-a-manos-nacionales-19546)
Infobae - Camargo Correa invertirá u$s100 millones en Loma Negra. (https://www.infobae.com/2005/05/27/189350-camargo-correa-invertira-us100-millones-loma-negra/)
El Cronista - Juan Carlos Fernández, de Impsa: "Estábamos como caballo en la gatera, muriéndonos por salir y no podíamos, por nuestras limitaciones". (https://www.cronista.com/negocios/Juan-Carlos-Fernandez-de-Impsa-Estabamos-como-caballo-en-la-gatera-muriendonos-por-salir-y-no-podiamos-por-nuestras-limitaciones-20180702-0044.html)
FIX SCR - Rovella Carranza SA - Informe de Calificación. (https://www.fixscr.com/media/3040/informe-publico-rovella-carranza-sa.pdf)
Guia Senior ARGENTINA - ROVELLA CARRANZA SA. (https://guiasenior.com.ar/empresa/rovella-carranza-sa/)
LA NACION - Qué pasa. (https://www.lanacion.com.ar/economia/que-pasa-nid698254/)
Los Andes - Impsa sigue en rojo pero redujo 36% las pérdidas y triplicó las ventas. (https://www.losandes.com.ar/economia/impsa-sigue-en-rojo-pero-redujo-36-las-perdidas-y-triplico-las-ventas-/)
PAN AMERICAN ENERGY GROUP - PAN AMERICAN ENERGY GROUP. (https://www.paeg.com/acerca-de-paeg/pan-american-energy-group)
Pan American Energy - Acceso para proveedores. (https://www.pan-energy.com/proveedores)
Construar.com.ar - Homenaje a Benito Roggio. (https://www.construar.com.ar/homenaje-a-benito-roggio/)
Investing.com - Cuenta de resultados Corporación América Airports (CAAP). (https://ar.investing.com/equities/corporacion-america-airports-sa-earnings)
Investing.com - Cuenta de resultados Corporacion America Airports (CAAPm). (https://ar.investing.com/equities/corporacion-america-airports-sa-earnings)
Marketscreener - Cotización CORPORACION AMERICA AIRPORTS SA Acción CAAP Mercado NYSE | Gráfico. (https://es.marketscreener.com/cotizacion/accion/CORPORACION-AMERICA-AIRPORTS--40257031/graficos/)
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)
Argentina.gob.ar - Obras Públicas. (https://www.argentina.gob.ar/obras-publicas)
Convoca.pe - Empresa investigada por caso 'Club de la Construcción' es la principal contratista de la ARCC con montos por S/ 3,9 mil millones. (https://convoca.pe/investiga/empresa-investigada-por-caso-club-de-la-construccion-es-la-principal-contratista-de-la-arcc)
LA NACION - La venta de Impsa: apogeo y caída de Pescarmona, uno de los industriales más importantes de la Argentina. (https://www.lanacion.com.ar/economia/la-venta-de-impsa-apogeo-y-caida-de-pescarmona-uno-de-los-industriales-mas-importantes-de-la-argentina-nid2505134/)
El Economista - Paolo Rocca en ProPymes 2024: "La industria quiere ser parte de este proceso de 'reset' de la Argentina y ser protagonistas". (https://eleconomista.com.ar/2024-10-paolo-rocca-propymes-la-industria-quiere-ser-parte-este-proceso-reset-argentina-protagonistas/)
Infobae - Río Matanza-Riachuelo: Explora uno de los proyectos de infraestructura más emblemáticos de Argentina | Termómetro económico y social de latinoamérica. (https://www.infobae.com/america/america-latina/2024/04/17/rio-matanza-riachuelo-explora-uno-de-los-proyectos-de-infraestructura-mas-emblematicos-de-argentina-termometro-economico-y-social-de-latinoamerica/)
iProfesional - El imperio Roggio, afectado por las coimas: cómo su estrategia para quedarse con negocios clave. (https://www.iprofesional.com/negocios/267575-corrupcion-el-imperio-roggio-afectado-por-las-coimas-como-su-estrategia-para-quedarse-con-negocios-clave)
BBVA Research - Argentina: financiando la brecha de infraestructura. (https://www.bbvaresearch.com/publicaciones/argentina-financiando-la-brecha-de-infraestructura/)
Fundación de Investigaciones Económicas Latinoamericanas - ARGENTINA: INFRAESTRUCTURA, CICLO Y CRECIMIENTO. (https://www.fiel.org.ar/publicaciones/informe-de-infraestructura-fiel-argentina-junio-2023)
LA NACION - La construcción de la mayor obra de infraestructura de las últimas décadas quedó en manos de cinco empresas. (https://www.lanacion.com.ar/politica/la-construccion-de-la-mayor-obra-de-infraestructura-de-las-ultimas-decadas-quedo-en-manos-de-cinco-empresas-nid2407762/)
El Constructor - Loma Negra: El balance financiero de la gigante del cemento. (https://www.elconstructor.com/2024/09/loma-negra-el-balance-financiero-de-la-gigante-del-cemento/)
La Nación - Loma Negra, a punto de tener nuevo dueño brasileño. (https://www.lanacion.com.ar/economia/loma-negra-a-punto-de-tener-nuevo-dueno-brasileno-nid679164/)
ABC Color - Camargo Correa de Brasil compra la firma Loma Negra de Argentina. (https://www.abc.com.py/edicion-impresa/economia/camargo-correa-de-brasil-compra-la-firma-loma-negra-de-argentina-850195.html)
EL PAÍS - El grupo Roggio recupera brío | Economía. (https://elpais.com/economia/2016/06/20/actualidad/1466429043_455245.html)
Trivia by Consejo - Benito Roggio e Hijos SA y Ormas Ambiental SA – UTE, TFN, Sala D, 23/11/05. (https://trivia.consejo.org.ar/banco-de-datos/tfn/detalle.html?id=81582)
El Cronista - Paolo Rocca: "La industria quiere ser parte de este proceso de 'reset' de la Argentina". (https://www.cronista.com/economia-politica/paolo-rocca-la-industria-quiere-ser-parte-de-este-proceso-de-reset-de-la-argentina/)
Clarin.com - Loma Negra, complicada: se cae la venta a un grupo brasileño y la casa matriz va a concurso de acreedores. (https://www.clarin.com/ediciones-anteriores/loma-negra-complicada-cae-venta-grupo-brasileno-casa-matriz-concurso-acreedores_0_Bk_9j05RFg.html)
Clarin.com - Loma Negra podría volver a manos nacionales: Mindlin sigue en carrera para comprar la reina del cemento. (https://www.clarin.com/economia/loma-negra-podria-volver-manos-nacionales-mindlin-sigue-carrera-comprar-reina-cemento_0_ByQ96d0sCte.html)
Market Research Future - Mercado del Sector de Infraestructura - Tamaño, crecimiento y visión general. (https://www.marketresearchfuture.com/es/reports/infrastructure-sector-market-10864)
Mordor Intelligence - Mercado de la Construcción en Argentina, Informe 2025-2034 | Cuota, Análisis. (https://www.mordorintelligence.com/es/industry-reports/argentina-construction-market)
Global Market Insights - Mercado de construcción de infraestructura de transporte, informe 2032. (https://www.gminsights.com/industry-analysis/transportation-infrastructure-construction-market)