Argentine mining in the crosshairs of the US and Japan

Following the approval of Argentina’s incentive regime for large investments, known as Rigi, the US and Japan have shown interest in forming partnerships related to minerals.

Through the legislation, the regulations for which were published on Thursday in the official gazette, Javier Milei's government seeks to boost the economy by offering tax, customs and foreign exchange benefits for projects exceeding US$200mn in investment in key sectors, such as mining.

As part of an energy security dialogue between the US and Argentina, the US Undersecretary for Economic Growth, Energy, and the Environment, Jose W. Fernandez, and Argentine foreign minister Diana Mondino signed a memorandum of understanding to strengthen cooperation on the energy transition and the development of clean energy technologies.

The two expressed their willingness to promote trade and investment in the exploration, extraction, processing, refining, recycling and recovery of critical minerals during a ceremony held on Friday in Buenos Aires.

“Argentina is joining a US-led initiative aimed at attracting more investment in mining,” says a document from the US embassy.

The announcement is part of US efforts to secure its supply chains and ensure the growth of domestic production of batteries for electric vehicles, without depending on China. 

By 2024, China's share of the global electric vehicle market is expected to reach 45%, while Europe will account for 25% and the US around 11%, according to a report from the International Energy Agency (IEA).

China accounts for nearly 90% of global cathode materials for battery manufacturing and more than 97% of anode materials.

But the US is making great strides, growing its electric car market by more than 40% last year, compared with 35% in China, the IEA added.

Japan and Argentina

Meanwhile, representatives of Mitsubishi Corporation, Toyota Motor, Mitsui, Sumitomo and Marubeni, as well as the Japan Bank for International Cooperation and Japanese embassy officials in Argentina met with the San Juan provincial mining ministry to request information on mining conditions and to discuss investment options, local media reported Thursday.

In July, representatives of the Japan external trade agency Jetro visited San Juan expressing interest in promoting bilateral trade and investing in the province that hosts the Josemaría, El Pachón, Filo del Sol, Los Azules and Altar copper projects.