Ariel Williams ’16
In my last post, I highlighted many of the cultural aspects we encountered during our first few days in the city. Since then, we have had the opportunity to learn more about government, business and society from our visits in Buenos Aires. While the visits represented a number of different industries throughout Argentina, many of the firms echoed the same optimism about Argentina’s ability to be a much better environment for business in the coming years.
DAY 1 of COMPANY VISITS
We first visited Banco Galicia, one of the country’s oldest and largest private banks, where we met with CEO Sergio Grinenko. The visit highlighted how different the commercial banking industry was from other countries. Banco Galicia focuses mainly on transactional operations and short-term lending. This differs greatly from banks in other countries where mortgages and long-term lending play an integral role in their core business. The differences are reflective of the tumultuous economic environment that has plagued the country since the turn of the century. But despite the high rate of inflation, the government defaults, and mismanaged economic policies; Banco Galicia has been able to persevere for more than 100 years.
We then also had the opportunity to meet with prominent economist Miguel Kiguel (Columbia University Grad!) who gave us an overview of Argentina’s potential for growth in the next few years. Kiguel’s remarks focused on the future of Argentina in the context of the Macri government and he expressed that new policies would help Argentina to resolve its debts and begin to experience a healthy growth rate. When we heard from Puente, CEO Emilio Ilac illustrated how these policies would positively affect their plan to expand aggressively and serve as the prominent Argentine small/mid market investment banking and financial services firm.
Visit with Puente.
DAY 2 of COMPANY VISITS
Our second day of company visits focused on media, agriculture, and real estate. Grupo Clarin, which is a media holding company, highlighted the challenges they have had operating under the previous Argentine government. It was interesting to see how impactful government could have on the ability of businesses to operating efficiently. Similar to previous visits, Clarin expressed excitement about being able to manage their businesses under a much better working relationship with the new government. Our visit with CRESUD reflected the new transition to develop agriculture and technology related to farming. In addition, it also illustrated the government challenges the firm faced when transitioning from an agriculture firm to a firm focusing on developing real estate.
That same day we met Domingo Cavallo, a famous economist who was instrumental in developing the fixed peg to the U.S. dollar in the 1990’s. It was fascinating to hear from him as he helped to illuminate the rational for developing the fixed peg (to stabilize inflation) and he was also frank about the missteps the country faced in managing the peg, monetary and fiscal policy.
DAY THREE of VISITS
Our third day of visits brought us an opportunity to connect with a fellow Columbia Business School Alumnus during our company visit at Tenaris. Tenaris, a supplier of finished steel piping to the oil and gas industry is part of a major international conglomerate Technint. The business was my first opportunity to visit a manufacturing firm where we learned how important process and quality control is to creating the pipes that move our energy. Moreover, the visit brought a lot of insight into how the effects of a global glut of oil will impact their business. It not only was great to see a company with such a commanding international presence in Argentina, but it was also great to see the efforts Tenaris has made locally to impact their community.
Learning about the steel making pipe process from the factory.
As part of our visit with Tenaris, we visited a technical and engineering school they created near their headquarters
We finished our day out with one of my favorite highlights of the trip – visiting River Plate, Argentina’s largest (and best!) soccer team. Chazen organizer Nicolas Kiguel (a very loyal fan) said that visiting the stadium would teach me the meaning of true passion. He was definitely right!
Chazen organizer Nicolas Kiguel teaching us about passion!
I look forward to updating you all on our visit to the Casa Rosada and our adventures in Mendoza next time!