Handheld Technology
Argentina’s ICT Weakened by Government Meddling
Posted by Jerry Nelson
September 03 2013
If you think of South America’s second largest country you think of steak, tango and gauchos. It’s hard to find someone outside of South America who can name just one innovator from there in the field of science, medicine or technology. But while many people don’t realise it, Argentina has been a world leader in the sciences.
Argentines have three Nobel Prize laureates in the Sciences including Barnardo Houssay, Cesar Milstein and Luis Leloir. On the nuclear power front, the programme has been successful also. In 1957 Argentina became the first country in Latin America to design and build a research reactor with home-grown technology. In medicine, Argentina is a path-maker as well; coronary bypass, cancer research and the artificial heart are among breakthroughs enabled by leading scientists and healthcare researchers.
Unfortunately, the same powerhouse thinking does not extend to other technologies, especially ICT. A look at Argentina’s ICT landscape will reveal many strengths and many weaknesses and, ironically, the government is the reason for the former as well as the latter.
Government policies in the early 20th century made Argentina one of the wealthiest countries in the world. By the late 1920s when the Great Depression erupted, Argentina’s standard of living was on par with that of the US. Following the war and through the 1960s, Argentina continued to enjoy economic growth and stability.
Political and economic chaos gave rise to the military junta that ruled Argentina from 1973 to 1986 and the country has never fully recovered. Corrupt and inept politicians combined to allow elected officials to use the Argentine treasury as their personal piggy-bank and the current president, Cristina Fernandez de Kirchner, has elevated greed, corruption and ineptness to an art form.
While the government initially pushed strongly for privatisation and deregulation and entered a “tech boom” of sorts in the last decade, policy shifts and ego in government seat La Casa Rosada (‘The Pink House’) is now leading to over-utilisation of government power and control.
Creating mind-numbing decrees and playing musical chairs with key agency leaders to suit its own purposes, the Argentine government has made it practically impossible for businesses to operate without state interference and it has eliminated the management transparency which helped ignite the initial technological rush.
A perfect example of this was the creation of the Comision Nacional de Telecommunications (National Telecommunications Commission). Initially the NTC was under the oversight of the legislature. Almost from its creation, the executive branch started modifying legislation by degrees and replaced a succession of increasingly Executive Branch supporters which resulted in less transparency for the agency as well as regulative power.
President Kirchner has had a running battle of egos with the legislative branches and governmental agencies. While there has been a three-way tug of war, ICT throughout the country has been largely forgotten.
In December 2011 in an effort to stabilise the economy, Argentina temporarily blocked the sale of smartphones including Apple’s iPhone. Meant to slow inflation and reduce the growing spread between the peso and the US dollar, the ban was part of the Argentina Ministry of Industry’s decision to reduce the automatic import of certain phones, with many US companies being forced to wait between 60 and 180 days for permission to sell.
Cellphone manufacturers were told they could avoid the ban and sell products in Argentina if the company would install a facility to make the phones locally. Following the lead of Apple and RIM, maker of the Blackberry, all of the cellphone makers refused to meet the demand.
A strong, healthy black market in cellphones exists because of the continuing government policies. While the total ban of cellphones was eventually lifted, the outright ban was immediately replaced with taxes and tariffs that often exceeded the value of the phone alone and thus became a sort of ban themselves. And, not happy with just the few pesos that taxes and tariffs can bring in, the government, through customs, has also instituted a 50% (of stated value) fee for any electronics brought into the country. Such items cannot be safely shipped into the country either.
With the taxes and tariffs included, Argentine customers for cellphones and electronic technology routinely pay 200% or more when compared to their Latin American neighbours.
Things might be on the verge of change though. On 11 August, 2013, Fernandez de Kirchner’s ruling party, Victory Front, was handed a stunning defeat, garnering only 26% of the vote. This was down from 54% when she was re-elected two years ago and political watchdogs are taking her party’s defeat as a sign that Argentines are growing tired of the President and her Party. With Kirchnerites out of the way, technology should become more affordable to every household and a proliferation of home-grown innovations could be on the horizon in the near future.
Jerry Nelson is an American freelance photojournalist, based in Argentina, who covers politics and social justice issues that fly under the radar of mainstream media. His website is http://journeyamerica.org
Source: www.idgconnect.com
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