Argentina is overtaking Brazil as the most-visited country in Latin America, creating big opportunities for foreign investors in the tourism sector, according to Sebastián Slobayen, the country’s secretary of coordination and tourism investments. 

In 2017, Argentina received 6.7 million foreign tourists against Brazil’s 6.5 million and Chile’s 6.4 million. Its foreign tourist numbers are growing at 5% annually and the country is on course to attract more than 7 million visitors in 2018, according to the Argentine tourism ministry. The government has set a target of 9 million foreign tourists by 2020.

Flying high

Overall, 21 million Argentine and foreign tourists stayed in hotels in the country and 13 million people took flights in 2017, setting new records. Tourism has become Argentina's fourth largest source of foreign exchange after exports of oil seed, grain and vehicles. Foreign tourists spent $5.4bn in the country in 2017 while national tourists spent $11bn on travel and credit card purchases. 

The tourism industry accounts for 1.3 million jobs in Argentina – directly and indirectly – and about 9% of GDP, which the IMF forecasts at $475bn for 2018. 

“We have been targeting European and North American tourists in particular,” said Mr Slobayen, during an interview at the World Travel Market international travel show in London on November 6. “Our strategy is now to develop sustainable and eco-tourism. Our country is our main asset. We wish to protect it, invest in it – and above all – share it. Connectivity is also improving rapidly. The number of domestic flight routes into the country has increased three-fold and the number of international flights has jumped by 20% since 2015.” 

More than 10 airlines filed requests for more than 280 national routes in and out of Argentina between 2016 and 2017. The country is spending $1.5bn to upgrade all its major airports, including Salta, Bariloche and the main international airport in Buenos Aires, Ezeiza. This will enable the airport network to support more than 1000 new national routes connecting the country, which is 4000 kilometres in length. 

Low-cost airline Norwegian now connects London to Buenos Aires seven times a week, while Edelweiss and KLM both fly regularly to the Argentine capital from Zurich and Amsterdam, respectively. In 2019, there will be a new Air Europa flight connecting Madrid directly to Iguazú, the home to Unesco World Heritage site waterfalls. 

Sites to behold

Argentina boasts 46 national protected areas – four of which are Unesco World Heritage sites. Iguazú, the Perito Moreno glacier, Peninsula Valdes and the Mendoza wine producing area are among the most visited parts of the country. 

“There is huge potential for tourism investment in the country,” says Mr Slobayen. “We really want to increase the number of beds, for example. We are already seeing record occupancy rates of more than 80%. More than $2bn is being invested in hotels and we would like to see even more FDI. We are opening up the skies and we want to catch up with Brazil and Chile in terms of the number of flights.

“The devaluation of the peso has made Argentina very competitive for foreign tourists who want to visit it. It is also a very safe country compared with some of its neighbours.”

Argentina is in the middle of a severe economic crisis, and the Argentine peso has lost 40% of its value against the US dollar between January and November 2018. The inflation rate is one of the world’s highest, at 31%, and the IMF forecasts a decline in GDP of up to -2.6% for 2018 and -1.6% in 2019. The national government is undertaking a severe austerity programme that will reduce spending by 7% this year, and has secured a $57bn stand-by financing agreement with the IMF, the largest in the fund’s history.