BUENOS AIRES, Argentina — Justin Trudeau took his first steps in South America as prime minister Thursday, landing in Argentina for a two-day stopover in a country that is rapidly opening up its foreign investment rules.
After years of populist, nationalistic governments, Argentina is moving towards the political centre as president Mauricio Macri makes changes to currency rules, the tax code and the central statistics office to rebuild credibility and investor interest.
Prime Minister Justin Trudeau meets President of Argentina Mauricio Macri at Casa Rosada in Buenos Aires, Argentina, on Nov. 17, 2016. (Photo: Sean Kilpatrick/CP)
But Macri's moves have been problematic for Argentines: their currency fell in value by 30 per cent after controls were removed, some 200,000 jobs have been lost based on estimates from the Argentina Center of Political Economy, and the cost of electricity has shot up by about 300 per cent after the government cut energy subsidies.
Domestic polling figures suggest the majority of Argentines are not pleased with the state of affairs in their country.
Before leaving Cuba on Wednesday, Trudeau described Argentina as a country with challenges, but also opportunities for growth. For Macri, those opportunities come in the form of direct foreign investment that his cash-strapped country desperately needs.
'We are paying for decisions we have made in the past'
"We are paying for decisions we have made in the past. They weren't bad decisions, but they have a cost," said Melisa Argibay Rojas, who says she struggles to pay her electricity bills in the Argentine capital.
"I think we need investments. I think we need regulations. I don't think we need to sell everything. But I think it's good for the country that (foreign) money enters. We need it."
So what's in it for Canada?
A former Canadian diplomat to South America called Trudeau's visit a shrewd geopolitical move given the political shift that is underway in Argentina, something that's being mirrored in neighbouring countries.
Allan Culham said the prime minister's timing is perfect for building personal relationships, which the South Americans like.
'Terra incognito for a lot of Canadian society'
"It's a kind of terra incognito for a lot of Canadian society," said Culham, who served as Canada's ambassadors in Guatemala, El Salvador, Venezuela and to the Organization of American States.
"That said, Canadian society is much more engaged in the region than the Canadian government. In fact, the Canadian government is playing catch-up."
The Argentine ambassador to Canada said the meeting between Macri and Trudeau is an opportunity to revamp the relationship between the two countries since it hit a low point four years ago.
That was at the Summit of the Americas in 2012, when the previous Conservative government opted against a pro-Argentina resolution in the long-running dispute over the Falkland Islands.
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Ambassador Marcelo Suarez Salvia said his country wants international financial help to deliver major infrastructure projects and hopes the pitch will entice Canada's public and private sectors.
He said Argentines also want Canadian expertise to help bring 3,000 Syrian refugees to the South American country.
Canadian companies already have a foothold in Argentina, mainly in the mining sector, which receives the bulk of the attention in Canada over concerns about the social and environmental impact of projects.
Paul Haslam, an associate professor of international development at the University of Ottawa, said his research suggests Canadian firms are not more likely than other foreign-owned firms to cause tensions.
"That being said, some firms are involved in conflict and there has been a couple of nasty accidents with Canadian firms recently in Argentina," said Haslam.
Pro-business climate, at last
Macri is looking to make it easier for mining firms to operate in the country, cutting taxes federally and looking to have the provinces, who have jurisdiction over mining operations, follow suit, Haslam said.
The changes signal a pro-business climate in the country that hadn't existed for years, he said.
"Argentine society is exactly the same as it's always been, which is very divided between a populist, Peronist bent, and a more educated middle class associated with Macri," Haslam said.
"Why that's important is that I don't think the mobilization around mining is likely to go away."