ICMA International / Where We Work / Argentina


ICMA México-Latinoamérica helped subnational governments in Argentina establish sound credit ratings in order to mobilize capital for infrastructure development.

Panama City

The Argentine Republic is the second largest country in South America and has the third largest economy. It is rich in natural resources and has an export-oriented agricultural sector and a relatively diversified industrial base. Argentina has had a tumultuous political and economic history, with alternating periods of military and civilian rule punctuated by economic ups and downs.

Although it is known for its mountains and pampas, or plains, Argentina is highly urbanized. Buenos Aires, the capital, has a population of about 2.9 million, with many of the advantages and problems associated with urban areas, including a vibrant cultural life despite income inequality, beautiful modern building as well as substandard housing, walkable parks as well as frustrating traffic.  

Compared with other Latin American countries, Argentina has a relatively good infrastructure system at the national level. Like their counterparts in many other Latin American countries, however, subnational governments (e.g., provinces and cities) often have aging or inadequate infrastructure and are eager to mobilize capital to underwrite improvements. A prerequisite for borrowing from investors, of course, is a good credit rating supported by sound financial management practices. Argentina has a relatively mature financial market, and the three large credit rating agencies have a presence there.

In order to increase their ability to attract investors, the city of Mendoza and the province of Salta participated in ICMA’s Regional Credit Rating Improvement (RCRI) program. The RCRI program, funded by a grant from the World Bank through the Public-Private Infrastructure Advisory Facility, was implemented by ICMA México-Latinoamérica.

Mendoza, in the heart of Argentine wine country, had never sought a credit rating before, but expressed interest in issuing bonds. Salta province had several large loans, and a bond issue backed by revenues from oil production rights that was expected to be paid off at the end of 2012. Like Mendoza, Salta was also considering a new bond issue. Both subnational governments asked ICMA to help them establish the best possible credit ratings before seeking new financing. 

Through the RCRI program, subnational governments in Latin America were partnered with their counterparts in the United States using the ICMA CityLinks model. Mendoza and Salta were partnered with Santa Fe County, New Mexico, to identify and implement improvements in financial management practices that would lead to enhanced creditworthiness. The partners participated in site visits, planning sessions, and other activities that brought their finance managers into face-to-face collaboration in Argentina and Santa Fe County. The lessons learned not only benefited the partner governments, but can be passed along by ICMA México-Latinoamérica to municipal professionals throughout the region.  

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