The Impact of Globalization on Argentina and Chile
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The Impact of Globalization on Argentina and Chile

Business Enterprises and Entrepreneurship

Edited by Geoffrey Jones and Andrea Lluch

During the first global economy of the late nineteenth century and early twentieth century, Argentina became one of the richest countries on earth, while Chile was an economic backwater. During the contemporary era of globalization, liberalization and institutional reforms in Chile provided a context in which business grew, while in Argentina, institutional dysfunction made productive business hard to sustain. This book explores the complex relationships between corporate behavior, institutions and economic growth through the contrasting experiences of Argentina and Chile. In nine chapters written by prominent business historians, the work addresses the role of business in these two eras of globalization, examining the impact of multinationals, the formation of business groups, and relations between business and governments. It places the regional experience within the context of the worldwide history of globalization.
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Chapter 5: Spanish business in Argentina and Chile since 1880

Javier Vidal Olivares


The growth of Spanish business in the Southern Cone of Latin America began in the late nineteenth century. It was initially driven by massive Spanish emigration to Argentina, and to a lesser extent, Chile and Uruguay. Simultaneously, Spanish exports boomed, and to attract foreign direct investment (FDI) a number of institutions, especially the Chambers of Commerce, were created. Between the 1920s and the outbreak of the Spanish Civil War in 1936, there was extensive Spanish business operations in this region. Between the end of the Spanish Civil War in 1939 and the early 1960s, Spain’s closed economy and the economic policies of the Franco regime thwarted outward FDI, and curtailed the presence of Spanish companies in the region. Spain’s liberalization, beginning in the early 1960s and culminating in the transition to democracy and accession to the European Union (EU) in 1986, led to a revival in Spanish multinational enterprise (MNE) investment in the region. Starting in 1980, Spanish FDI in Argentina and Chile, as well as Uruguay, grew spectacularly. Spanish investment was driven by large companies that focused on banking and finance, energy, telecommunications and transportation, sanitation, and utilities. Spain became the leading investor in Argentina, and the second largest investor in Chile, during the 1990s and early 2000s. However, Spanish MNE investment lost its momentum again as a result of both policy shifts in Latin America, especially Argentina, and a major economic crisis in Spain after 2008.

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