Argentina President Javier Milei met with leaders of some of the world’s largest tech companies this week, embarking on a Silicon Valley tour that analysts say is likely designed to boost his international profile and showcase the South American country.
On his seventh overseas trip since taking office late last year, Argentina’s Milei travelled to San Francisco late Monday and has since met with OpenAI CEO Sam Altman, Google’s Sundar Pichai and Apple CEO Tim Cook.
The right-wing leader, and self-described “anarcho-capitalist,” is scheduled to meet with Meta CEO Mark Zuckerberg before departing from the U.S. on Friday. On a separate trip to the U.S. last month, Milei met with tech billionaire Elon Musk at a Tesla electric car factory in Austin, Texas.
Milei has shared photos of his encounters on social media platform X this week, typically depicting himself giving two thumbs up alongside the top-level tech executives.
Analysts say Milei’s charm offensive is likely designed to position Argentina as an attractive place to invest, owing to the South American country’s growing tech sector and ecosystem as well as promises of pro-business reforms.
Argentina’s President Javier Milei meets with Big Tech leaders: Here’s what you need to know
“Argentina is also home to significant critical mineral resources, with the world’s second-largest lithium reserves as well as large (and untapped) copper deposits,” Nicolas Saldias, senior analyst for Latin America at the Economist Intelligence Unit (EIU), told CNBC via email.
“Getting these minerals out of the ground is critical for both the green economy and tech firms having reliable access to critical inputs for their AI infrastructure. The growth of AI data centres will also require significant energy and water resources, which Argentina has in abundance.”
The EIU’s Saldias said U.S. tech companies were unlikely to invest in Argentina unless the ruling government can pass its keynote “omnibus” reform bill — which has since been significantly watered down — and its fiscal reform bill through Congress.
Reform agenda in focus
“The trip is valuable by itself because you’re attempting to put Argentina at the centre of a global conversation about material development and investments about technology,” Mariano Machado, principal analyst for the Americas at Verisk Maplecroft, told CNBC via telephone.
“We’re not only talking about sourcing, like lithium or copper, we’re talking about how these companies make decisions over where to locate their network centres and their offices and such,” Machado said Thursday.
“Nonetheless, it feels like this is kind of like a first step in terms of that conversation that would not necessarily lead to immediate reactions on behalf of companies and investors. But rather a ‘duly noted’ reaction, like ‘we see you’re doing your homework, but we need to see more to make a substantial decision,’” he added.
Aerial view showing members of social movements being blocked by security forces on their way to Olivos Presidential Residence to protest against President Javier Milei’s proposed reforms and cuts in the most vulnerable sectors, in Olivos, Buenos Aires Province, on May 7, 2024.
Milei has been struggling to enact his so-called “shock therapy” reform agenda, despite previously saying there is no alternative for the country.
In early May, Milei’s government faced its second general strike in less than six months, with workers nationwide angered by proposed austerity measures and a profound economic crisis.
Milei on Monday accepted the resignation of his cabinet chief Nicolas Posse at a time when his government battles to try to pass its proposed reforms.
“We assume that both bills will pass in the Senate, but in a diluted form. Even a watered-down version would boost investors confidence in Argentina and could lead major investors to open up their wallets,” the EIU’s Saldias said.
“If the bill is rejected, then investment will likely not materialize and an economic recovery would be slow and Milei’s government would likely tread water as its popularity would be a risk,” he added.
