Argentina’s Secretary of Entrepreneurship and SMEs Mariano Mayer has been awarded for his work on developing a strategy to revive Argentina's entrepreneurial spirit, including a new law for entrepreneurs.
Mayer was among several individuals honoured for their role in policymaking and drafting SME programmes by the Global Entrepreneurship Network (GEN) at an awards ceremony in Estonia earlier this week during the Startup Nations Summit.
Mayer took home the Startup Nations Award for National Policy Leadership.
“Having successfully tested entrepreneurship policy levers as an intrapreneur in the Buenos Aires city government, upon assuming broader leadership as National Secretary for Entrepreneurs and SMEs, Mr. Mayer began a bold, multi-pronged strategy to revive Argentina's entrepreneurial spirit, including a new law for entrepreneurs,” GEN said.
The three other winners were former Minister of Argentina’s province of Cordoba Jorge Lawson for the Startup Nations Award for Local Policy Leadership, the Innovation and Entrepreneurship Team from the World Bank, for the Startup Nations Award for Groundbreaking Policy Thinking and Mikk Vainik of Estonia for the Global Entrepreneurship Network Award.
Plan to grow SME numbers
In an interview in September with online publication Nearshore Americas, Mayer said Argentina now has about 850,000 SMEs – which make up 99% of all firms in the country. He said about 50,000 to 60,000 new firms are created each year in Argentina.
However, he noted that there has been no net creation of companies in the last two to three years. It's this that his government is looking to change, to put the country back on growth after years of economic instability.
Recently his government introduced a new entrepreneur and SME law (see this post), which aims to among other things boost funding and reduce the time it takes to open a new business.
A new online company registration system, which went live on 1 September (see this post), allows for the registration in Buenos Aires province of a new type of company called an SAS in just 15 minutes – down from two months to over a year that it took before. Mayer says the ministry is helping other provinces to introduce a similar system.
He says a tax reform is in process and his ministry wants to next simplify the country’s gargantuan bureaucracy.
Mayer earlier this month said the country needs to create one million new small businesses to ensure that 300,000 survive so that two million new jobs (that Argentina needs to create) can be generated. To ensure this is achieved, he pledged that his administration will add not one new regulation for enterprises.
This week Mayer's department announced the names of the 13 accelerators and three funds (see this story) that - together with the state - will invest more than $86 million into new projects through an accelerator (Fondo Aceleración) and expansion fund (Fondo Expansión). About half of this amount will be contributed by the state.
The idea is based on Israel’s successful Yozma fund (see this post), in which the state there was able to help grow a venture capital sector in the early 1990s.
Earlier this month national newspaper La Nacion reported that to qualify local and foreign accelerators have to have liquid funds of at least $150,000. In all 31 accelerators applied.
The funds, as well as a seed fund, which invests up to 250,000 pesos in firms of no more than a year old, falls under a new fund of funds Fondce (Fondo Fiduciario para el Desarrollo de Capital Emprendedor) which was unveiled in September.
In the same month the government predicted that the economy will grow by 3.5% in 2018 - with inflation falling to 10% from 24% the same month. Things are then on the up.
Likely because of this President Mauricio Macri this week called Argentina the "best place in the world to bet on".
But what many will hope now is that the red tape and corruption that Argentina is famous for will be eradicated as quick as possible. Until then nice policies such as getting the state to co-invest with accelerators will benefit little more than the elite.
Timm is a South African who writes on small business in emerging economies. He speaks Portunhol (bad Spanish) and has visited Argentina in 2010 and 2014. Follow Small Business Insight on Twitter at @Smallbinsight and on Facebook.
Stephen Timm is a