Reduce barriers to trade and regulatory burdens. High trade and regulatory barriers curtail competition, affecting competitiveness, exports and integration into global value chains.
Actions taken: Tariffs have been cut to zero for notebook and tablet computers in 2017. The number of products subject to non-automatic import licenses has been reduced continuously since 2017 but still contains over 1000 products. Administrative burdens have been eased, including with the creation of a single window in 2017.
Recommendations: Reduce tariffs through a combination of new trade agreements and unilateral action to foster a stronger integration into the world economy. Raise competition by reducing administrative barriers to trade and entrepreneurship.
Enhance outcomes and equity in education. Educational outcomes remain far below OECD standards, and are strongly linked to students’ socio-economic status. Better education can help reduce income inequality.
Actions taken: A new long-term plan for reforming secondary education has been designed although the exact timing of its implementation is not yet defined.
Recommendations: Invest more in early childhood education to reduce the gap generated by family environments early in life. Reshape teacher careers and support their professional growth early on. Scale up the current offer of vocational and lifelong education, and in particular technical courses and training to help displaced workers find new jobs. Strengthen the linkages between school and tertiary curricula and the labour market. Properly assess and anticipate skills needs to boost innovation and respond to future labour-market needs.
Improve infrastructure and reduce regional disparities. Significant gaps in infrastructure restrain economic growth and job creation, while contributing to wide regional income inequalities.
Actions taken: In 2017, public infrastructure investment has risen and a number of key projects have been started. A new airport for low-cost flights in Buenos Aires has commenced operations in 2018. In face of fiscal adjustment, several infrastructure projects are now being developed as public-private partnerships.
Recommendations: Implement planned infrastructure projects – both those planned as public investment and as public-private partnerships – to promote connectivity and intraregional trade within the country. Improve the capacity of subnational governments to execute projects without unnecessary delays.
Facilitate labour force participation of women. Increasing participation of women in the labour force can have a significant impact on economic growth and reduce income inequality.
Actions taken: A draft law to promote gender equality was submitted to Congress in 2018.
Recommendations: Increase spending on active labour market policies to help improve skills and promote employment opportunities for women. Continue improving access to quality childcare for children under 3 years of age. Reduce tax disincentives for women to work. Work towards a more equal system of paternity and maternity leave and promote equal pay. Promote gender diversity in leadership positions in public sector and private companies, notably by promoting transparency on gender balance and establishing gender goals in management.
Continue improving the efficiency of the tax system by broadening tax bases and moving towards less distortive taxes. Despite recent progress, the tax system could do more to encourage productivity growth and reduce inequality.
Actions taken: A 2017 tax reform has established a timeline for the gradual reduction of provincial revenue-based taxes and has reduced the disincentives for hiring low-wage workers on formal contracts.
Recommendations: Continue with the planned implementation of scaling back distortive taxes such as provincial revenue-based taxes and those on financial transactions. Broaden tax bases in personal income taxation by bringing more people into the personal income tax system and eliminate loopholes like the preferential tax treatment of certain investment incomes.
