Argentina Politics & Asset Servicing

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Keith Mahon, Managing Director of Apex Uruguay talks about the political ramifications of the NML Capital debt case against Argentina:

“The monetary amounts involved in the Argentina/NML pari passu case are a drop in the ocean compared with the global market. However, the political ramifications far outweigh the money concerned and given that there is a presidential election due in October, we will have to wait until then for the current stand-off to begin to resolve.

I don’t believe the situation in Argentina is likely to directly benefit Uruguay, any money that could have filtered into Uruguay from Argentina has already done so. Uruguay is known as the Switzerland of South America; it has banking secrecy, low risk of sovereign default and a cash, real estate economy. All of these things contrast with the economics of Argentina with its currency controls and over politicized banking system. Consequently, a lot of money has filtered into Uruguay from Argentinian or Brazilian investors looking for stability and low complexity due to exchange controls.

The country is politically stable. With a moderate left wing party in power, and looking to grow its influence internationally (especially in global service industries), Uruguay has set up a number of free trade zones where firms such as Apex can operate internationally.”


Apex Uruguay, Keith Mahon

“Apex established its Uruguay office in 2012 to act as a physical base for servicing Latin American clients. The Apex methodology of Global Reach, Local presence rings true here and whilst there are a range of service providers servicing the region, Apex is currently the only international player to have a ‘bricks and mortar’ presence in the country.

LatAm is a more traditional market and people are generally cautious when it comes to parting with their money as they want to be sure it is invested in the right product. Our intention at Apex Uruguay is to reach out to asset managers, high net worth individuals and local broker dealers with asset management arms, looking to set up offshore vehicles or invest internationally.

There has historically been a misguided mistrust of the offshore market amongst many investors in the region. The unregulated past has left its mark, however investors are gradually becoming more aware of the safety of Cayman and Irish funds (or Luxembourg UCITS funds) which is good news for Apex Uruguay in Latin America.”

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