PROVINCE ¢ OF Building a Buenos Aires Provincia Ministry of Economy of the Province of Buenos AiresDISCLAIMER “WE FRSEITATION HAS BEE PAPARED BY THE FROVAE OF ENDS ARES (THE “REVI SOLELY FOR FORMATION PURFESES AMO DES WOT EOASTUTE A RECEMAENDATION ROWE NOR ANY OF AFT AGENTS AECTOR, PLOWS, CFEC O8ADVSORS SH HAVE AY LABILITY WHATSEVE MEGUGENC OR HERS FOR NY LOS AISNG “met tenance ony topos nerfs pens nate eg tonestasane peor tam taylan acon Oy ‘ers presen oo aes onda ee at you sd oy stone's you ter ae ete aed ara yes aan termening at fe aunde he US Sets, ‘ef tet emer fu Sores Ar) mas 0 por de Und sates sn cg etn ant pron tne gusto see tentang ora oar ny Me onan Erm sil i roam een ers Bt Fonte et ey param na Mao Sat af he Ep ESTE oes sy ammeter oy SEU Ne tthe pc contd nie Freeman bases on ena sas ach a Pre or ‘saul resin teeing em at ete Sutin Arie ete Psnes Dietand 5 ‘nc ca yom mina oy pahon easy thatarg nace nated) ne Papas Grats (he hetes cae tn the ara net ‘en aque aes of rr ae hey ahead wae he fa its ary Merrett lied vss thatery sendin the Pepe Bech caster tha ia Weare fray) a en yo hal ras hy ‘Theworesion”PesecsOec mr rete 2003/7 os nerd pede mela BEE ENE Mente Sete “Tater inf tain et esr have refed epee eng etre ring Arde 19] of ne! Series nd Maat At 2009 [Francesa one bse nara hence Pena nse pease nin ee Mo tel engy mf ware comgeoe ence seston] [he Farc rent Ore i are ae ene gon rare penanate women atone adcomet te ergagen seer ay te eg tonto ok ‘Botinoca sre ad Mo 200° #54A)) nearer ih sa oe el ay seat terse Bruen and foe rin ah sh pens {soar ng fered alert ean) Ine prennnton recension muta bed nln by nasa een mt AY tester eres acy to wh pee aton eb olule sn eam Deon dil beenapenon with eran pen ‘fect re tration cana hen wet es ‘he rant mayo teens tat fet the rons a acta bat tere. Teer tte attend an ry of ase abt ‘ire sone af are seinyrdtne revise Sueur lng steer set erat as dues tt one eno errr om se ‘Sisrote pnt owt soon Teen nna gs nae nahn sma as Yousraeto tap tnecontarts ofthis psn ity coer rs tifa shy te fn lor snyprtat tis msettin maya be aan eons, byatenng th pretton yousrarschgta bean yeas matonExpected terms and conditions of the offering incia de Buenos Aires | stort vn ae So BNP PARIBAS ed re BBVA MorganBasic facts Largest population in the country Represents 38% of Argentina population The most productive engine for the country ‘The PBA produces 36% of Argentina's total ‘output and 54.5% of total manufactures? An agricultural powerhouse ‘The PBA represents about 34% of the total national sown area* PBA exports are well-diversified PBA exported USD 17.4 billion during the last 12 months (32.6 % of Argentina's exports)? (onstyo opts pene agra ob. st PBA Guus 20468 the hae off Prowntalnanaactueson tne National manufactures for te 9 P| re | stain | Provincial GDP? USD 190.9 Bn 35.8% Coan iad yee fiscal revenues? an | ame 1 is t/ha ests sb gor /dolimagufENPO-Stressed Initial conditions * Cash Balances as of December 10, 2015 amounted only USD 13*mm (1% of December's wage bill) + Suppliers were usually paid 9 months after delivering their goods or services * Financial skeletons * 109 out of total 135 municipalities running fiscal deficits + Structural fiscal deficit: * Reduction in effective co-participation from 25% (1992-2002) to 18% in 2016 * Nominal freezing of the “Conurbano” funds: ARS 650 million for the PBA (1.4% of total)** * Infrastructure ga * Depressed levels of investment in infrastructure: only 3.7% of total expenditures in 2015 * Current deficit accounted for 73% of total deficit (2015)After two years of balanced budgets, the fiscal deficit reappeared in 2015 1.0% & Primary balance/Provincial GDP. 18 Financial balance/Provincial GDP 05% 0.5% a 1% & 0.0% - 8 & 2% 0.5% il U a ae I 05% 06: 1.0% ston, 0% 1.0% “1.5% 13% 2008 = 2009-2010 2011S 2012 2013, 20142015 ie ‘CAPEX AS PERCENTAGE OF TOTAL EXPENDITURE? 53% sx sem 9.0% ad S66 2% 5456 7.0% S26 th. 50% 48% 5.0% 46% 40% as “a aie sax | Aaa % - 20 40% eeseeeeeee4ne 2008 2009 2010 2011 2012 2013 20142015 ZR2E82 88988 985Public finances: from emergency to predictability Re-gaining financial strength Suppliers bond issuance for USD 0.5bn* Bonds issued in the international markets: USD 3bn Bonds issued in the local market: USD 0.5 bn* Less reliance in the T-bills program (more expensive debt) Financial Skeleton reduction Efficient spending and more investment Savings in procurement process Wage expenditure control More balanced municipalities finances Increase in capital expenditures Predictability Schools classes started on time after five years with consecutive strikes Year long wage agreement for 2017Wage negotiation: shifting from backward to forward-looking ae 2016 Wage increases in line with the target 40% ce 375% inflation 36.6%" 30% 20% 10% om Teachers Provincial state workers Provincial state workers Others — excluding, includede in Law N* inchudedin awn" 10430 Teachers among ones ater major unions Aprox. 22% of total government employeesImproved fiscal transparency PROVINCIAL BUDGET TRANSPARENCY INDEX FISCAL TRANSPARENCY ~ PBA ~ SCORE EVOLUTION cordoba Ente ios cB santare 95 ‘Quarterly fiscal report 93 Statistical year-book Quarterly debt report Teuguen Rio Negro Mendoze sala san tuan ‘ucuman Chaco Formosa S.del Estero del Fuego tari |} Corrientes Chabut san tus Santa raz siuy 1a Pampa ta enor co-artipation with oa Trunicipaltes q as 74 2015 2016 fnThe path towards more investments and balanced fiscal accounts Currents Revenues 23.0 255 267 Total Tox Revenues 213 4 189 All new debt issues Social Security System 52 5 a are for capital "Non Tax revenues on om expenditure Currents Expenditures Personnel ‘Goods and Services Property Rent Social Security System Benefits Current Transfers Current Account Balance (Capital Revenues Capital Expenditures Gapltal Balance: Total Revenues ‘otal Expenditures STRAT Financial Balance Capex: From 6.3% in 2016 to 8.4% in 2017 579. “aval average exchange ate Central Banko rpntin (Cameron A S00) ASAD: 927 for2018 and ARSUSD:18.78oC 216 — 39The infrastructure master plan is under way 2017 Projects* Distribution by subject ea *% Security vest * rote water sage agen Ener ot sera sedmiice sraiage woe owing nd wien slang la reangot / oe Si ierigaton, ‘rane ana drinoae \ keology and 16 ‘envionment Teaniation 15% Go eaeucuec ta aur cere so EE ta IDB m8 FONPLATA 7Federal vs Provincial tax revenues we, RES 29R2 29888 gee e88 89585 I a ag ;, anommmmeasoeoman aoe a “%Negotiation to increase federal transfers to the PBA EFFECTIVE CO-PARTICIPATION COEFFICIENT AUTOMATIC TRANSFERS 2016* pa TEMACEL CO E2967 . ——-——, "24829 25% ot —__— 2204 .o. —e 2065 249% wt —e! 19903 23% nc sie a SAN.3¥ (pemem 503 Sacco ——<—< 160% 2% “< —_— 1632 Fo Mens fee ses > | 1% fence Se LID PPL PPP SOP a FIIESE ESSE SS gs fae foe te Sock Sein sauce meres PBA generated approximately 37% of national tax. (MENDOZA SN 813.3. revenues, but only received 18% in 2016 19000 2.0000 30000 20% 19% uso ueros Ales an am estimation, Mince the tasters fom he Federal Goverment unde the Decree N° 194/16 enon ofthe Province; Secretar of Teas, Ministry of Teasuy and Publ Finances of Argentina: 20U6Natona BsAnew framework for PPP PUBLIC-PRIVATE PARTNERSHIP (PPP) * In recent decades countries have developed specific regimes for infrastructure development under PPP * In order to end with social and infrastructure deficits, the private sector can help the Federal and Provincial governments with the financing and execution of big public projects + The public sector can gain from the efficiency and expertise of the private sector + The provincial senate approved the adhesion to the federal law N. 27,328, which regulates the PPP framework, expected to be passed as a law in March 2017Public debt to GDP ratio remains below 7% PUBLIC DEBT/PROVINCIAL GDP PUBLIC DEBT/TOTAL REVENUES: 12% 100% 93.4% 10.4% 87.2% we 9.9% on 80% 76.4% 89% 67.4% 8% 7.8% 7 5%, 70% 65.1% id 6.4% ome 54.6% 47.0% 6% 5.5% 98% 50% 44.5% 44.5% 40% % lk 20% 2% 10% % o% 2008 2009 2010 2011 2012 2013 2014 2015 a3 2008 2009 2010 2011 2012 2013 2014 2015 a3 2016+ 2016+Financing Program 2017 (projected) eA, ARS usD GDP % Financial requirements 59 3.3 1.7% Primary deficit 12.1 07 0.3% Interest a 22.6 1.2 0.7% Amortization’ 24.3 14 0.7% Financial sources 59 33, 1.7% International market 35.8 20 1.0% Domestic market 16.2 09 0.5% Others ¥ 7.0 04 0.2% Rte ARGUSO 7.Important reduction in markets needs 28% 4.0 Suppliers bond, 0.5 Domestic Market, 0.5) 25 International Market, 3 20 : = 33% 29 Domestic Market, 0.9 International Market, 2.0 povDebt Service - Stock is USD 11.8 Billions as of September 30, 2016 MATURITY PROFILE STOCK BY CREDITOR Domestic Federal Bondhold overnm enai9% ent 25 238% nas Malate aicrea Agencies 58% 1 ter 10 sanchld_/ wo 09 es Bites ay 07 i tame i 1 01 01 01 04 09 o9 90 00 a > SPS PL ANNE SHEE ELAS us bion % ‘NEE Minterest_ — m AmortizationThank you! 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