Spotlight: Argentina’s paralyzed infrastructure projects

Provincial authorities, contractors and labor unions in Argentina are increasingly concerned about the large number of paralyzed infrastructure projects amid President Javier Milei’s austerity drive.

According to Argentine construction chamber Camarco there were around 3,500 paralyzed projects at end-January. Some of these had seen their works halted before the current administration took office on December 10 as contractors were wrestling with payment delays and soaring costs for materials.

The chamber even declared a nationwide “state of emergency” for the sector earlier this month, warning that up to 200,000 jobs were at risk.

The projects include those that have received funding from multilateral lenders.

Some of the main projects that have been stopped include:

-National route 9, Santiago del Estero-Termas de Río Hondo access stretch (Santiago del Estero province): A joint venture between Benito Roggio e Hijos and Mijovi holds the contract worth 41.3bn pesos (US$49.7mn) and had achieved 52.8% progress before Milei took office, according to Mapa Inversiones, a database compiled by the now defunct public works ministry. It was paralyzed this month, David Acosta, head of the Tucumán chapter of construction workers union UOCRA, told business daily Ámbito. 

-National route 9/34 highway, Rosario de La Frontera-Salta provincial limit stretch (Salta province). The 20.8bn-peso contract was awarded to Vialmani and works began in 2022. In December news outlet El Sol ABC reported Francisco Agolio, head of the local office of highway agency Vialidad Nacional, saying the project had been stopped. 

-Buenos Aires-La Plata highway, Ensenada distributor-provincial route 11 intersection stretch: The 89.9bn-peso project was awarded to a JV formed by Esuco and Helport, which has reached 12.9% progress. Works have been halted in the absence of federal funding, sources close to Buenos Aires’ public works minister, Gabriel Katopodis, told news outlet Política del Sur. 

-Buen Ayre highway section I (Buenos Aires): Sacde is in charge and has reported 85.6% progress. The project will demand an investment of 35.4bn pesos and it is paralyzed as of this month. 

-National route 33. Cañuelas-San Miguel del Monte stretch (Buenos Aires): Also in the hands of Sacde and worth an estimated 33.1bn pesos. It is among 700 projects in the province that were listed as halted by municipal authorities, daily El Destape reported last month.

-Riachuelo water system. Lot 2 (Buenos Aires): Also part of the province’s list of paralyzed projects. The contract is held by a JV comprising Fisia and Acciona Agua, with an estimated investment of 48.5bn pesos. 

El Destape’s report mentions that an additional 385 projects that were drafted by the previous federal government, where Katopodis served as public works minister, and the Buenos Aires administration, were discarded. 

As for other provinces, Tierra del Fuego works and services minister Gabriela Castillo said that the Milei administration had paralyzed around 30 projects worth 30bn pesos in the province since taking office. 

“First [the federal government] said that it wouldn’t advance new projects, later it was said that projects without funding wouldn’t begin, and the question would be what would happen with works under execution. Nowadays, in the face of absence of payments, companies have told us that they have suspended work continuity,” Castillo said in a press release issued by the local government.

The authorities in provinces like Mendoza and Buenos Aires are trying to keep works going, but face financing difficulties.