Argentine macroeconomic context forces huge 6bn potash project suspension

Monday, March 11th 2013 - 22:54 UTC

Full article 17 comments

Brazilian mining giant Vale announced on Monday it has suspended the 6 billion dollars Río Colorado potash project in Mendoza province. The mining, main producer of iron had halted the work on the project back in December, awaiting tax breaks for the project to help to compensate for soaring costs related to inflation and exchange rates. Read full article

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toxictaxitrader2
You cannot break the rules of economics without cost! I expect this sort of to happen all the time now,Argentina must find a way of de risking foreign investment,the example of Y.P.F. not been forgotten and is just symptom of a government of naive idiots .
Mar 12th, 2013 - 12:06 am - Link - Report abuse 0
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surfer
how. many. times.

you invest in Argentina - you lose your shirt.
Mar 12th, 2013 - 12:32 am - Link - Report abuse 0
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mastershakejb
typical Argie LOL's
Thanks for the comedy, Argentina! You're as funny as North Korea!
Mar 12th, 2013 - 01:37 am - Link - Report abuse 0
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St.John
The only way Argentina can remove the risk of foreign investment is by placing foreign currency in escrow in another country. Remember how they accepted New York legislation for the loans, then ran away from their obligations - la viveza criolla can't be trusted.
Mar 12th, 2013 - 01:59 am - Link - Report abuse 0
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expbrit
@1 YPF have their own problems.

http://www.reuters.com/article/2013/03/12/argentina-ypf-idUSL1N0C3FMS20130312?rpc=401
Mar 12th, 2013 - 02:01 am - Link - Report abuse 0
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toxictaxitrader2
@4
Good idea sir,but after paying for Y.P.F .court orders on bonds,and international
court orders where will it come from? the real problem with Argentina is the unofficial economy hence no tax base.
Mar 12th, 2013 - 08:15 am - Link - Report abuse 0
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LEPRecon
@5 - expbrit

I find it amusing that the CEO of YPF seems surprised that drilling equipment is expensive! LMFAO

As for this news, it's hardly unexpected.

But Tobias/TTT/Nostril etc... will be on here later stating that they don't need Vale, and that Mendoza is a paradise on earth, where the street are paved with gold, and they eat diamonds for breakfast etc...

Argentina doesn't need anyone! We know that because Tobias is always saying so.

In a way he's right. Argentina certainly won't be destroyed by the outside world, they are doing a damned fine job of it themselves.
Mar 12th, 2013 - 08:43 am - Link - Report abuse 0
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Nostrolldamus the 13th
Mendoza doesn't need mining to have an economy. It already has an economy.
Mar 12th, 2013 - 11:14 am - Link - Report abuse 0
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yankeeboy
Mendoza doesn't need mining to have an economy. It already has an economy.

Clearly you don't know how an economy works.

Well, let's see high end wine sales DOWN
Olive sales DOWN

Layoffs abound

Now the LARGEST FDI project in ARGENTINA directly employing 16,000 people, so effecting upwards of 65,000 individuals in those families, then the carry on from the suppliers...let's throw in another 100K just to be conservative.
That is a lot of tax revenue GONE, Families INCOME gone, businesses CLOSED, COnstruction jobs gone, Transportation jobs GONE, and on and on and on with a drain on the treasury for welfare payments etc.
and this is just the tip of the iceburg

Wait until GM and FORD and leave becuase they don't have ICSID protection
not going to be long now
Mar 12th, 2013 - 12:06 pm - Link - Report abuse 0
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LEPRecon
Hey Tobias there you are! I knew that you'd turn up eventually.

Mendoza isn't fine, and it does need the jobs for the economy.

But never mind, you don't actually work for a living, so it won't affect you - that is until your mother kicks you out and tells you to get a job, to help pay for the food that you consume, whose prices are spiralling upwards everyday.
Mar 12th, 2013 - 01:23 pm - Link - Report abuse 0
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Conqueror
@8 ”Mining is important to the Mendoza economy and has grown sharply in recent years, now accounting for 22% of output in 2005 (nearly 5 times the national average). Fourteen percent of the national reserves of petroleum are in Mendoza, also home to large-scale mining of lime and uranium.” Wow, seems like you don't know much.
Mar 12th, 2013 - 01:34 pm - Link - Report abuse 0
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Ayayay
In the long run, this has saved the environment for what COULD be an upscale eco paradise.
In the short term, losing 4k jobs in one day brings Mendoza unemployment near Spain's percentages.
Mar 12th, 2013 - 06:00 pm - Link - Report abuse 0
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ChrisR
If ever the Mendozans run short of food, they can always eat the cockroaches that abound in their main hospital, including the wards and the operating theatres.

Lovle on a shit sandwich! :o)
Mar 12th, 2013 - 06:02 pm - Link - Report abuse 0
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Ayayay
What's interesting to me is that a UK-Australian company first owned the project.
Australians are so into FAIR-TRADE WORKER PAY!!!! Their own minimum wage is around U.S $16 an hour.

Then a Brazil co. took over, which probably offered 'competitive' wages.

Now province officials are hoping an Abu company may want it. That country is known as among the worst worldwide for worker treatment.

The Arg federal gov-maybe they don't know how to make both sides of a negotiation a winner yet.
Mar 12th, 2013 - 06:49 pm - Link - Report abuse 0
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redpoll
Our snotty from Mentiroza is back! Once Crissy has confiscated Vales assets (Dilma may have a word or two to say about that) snotty might just be able to get a job as a lawn mower on the stadium in Mendoza named after some mythical place called Malvinas and be given the clippings to make a nourishing soup with his grarse roots as a side dish
Mar 12th, 2013 - 08:09 pm - Link - Report abuse 0
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Mendoza Canadian
From Seeking Alpha...I've seen this movie so many times in my 40 years' experience with Argentina that it is like watching a slow-motion train wreck. If I've learned anything, it's that you can never underestimate the ability of the Argentine government to screw things up. The incompetence and corruption of the government is endemic and criminal.
Mar 13th, 2013 - 11:16 am - Link - Report abuse 0
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yankeeboy
It sounds like CFK is considering expropriating the VALE site? Wouldn't that be interesting to watch.
hahahaha
such losers
they make all these arbitrary decisions without thinking about the consequences.
idiots
Mar 13th, 2013 - 04:02 pm - Link - Report abuse 0
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