The lack of a National Plan for Artificial Intelligence in Argentina

The ArgenIA National Plan for Artificial Intelligence, which emerged within the framework of the Digital Agenda 2030 and the Argentina Innovative 2030 plan promoted by the Government of Mauricio Macri, was put on hold by the Government of his successor, Alberto Fernández. This new Government came to consider it a reference document, but at the end of its administration, it failed to present a new plan. The government of Javier Milei, for its part, is also not working on a plan, and is betting that the market will organize the development of AI in the country on its own.

Although in 2022, the Secretariat of Strategic Affairs of the Nation called on specialists to discuss the country's potential in terms of AI and to address the development of a national technological sovereignty strategy, the country is still far from a strategy articulated with concrete actions. Thus, Argentina currently has no framework for state intervention in the development of AI, one of the most disruptive technologies of the last decade that is set to transform all areas of life, as the combustion engine or electric energy did at another time.

The consequences of this institutional apathy and lack of interest in addressing a key area will necessarily have negative effects on the country. Previous experience with industrial revolutions shows that countries that quickly adopt new technologies are those with the greatest chance of taking advantage of the growth opportunities provided by the windows opened by technological paradigm shifts. However, Argentina is procrastinating in defining guidelines for the sector leading the technological transformation of the fourth industrial revolution, perhaps believing that its endowment of natural resources is sufficient to guarantee the well-being of its entire population.

Letting the fourth industrial revolution led by AI pass by could continue to relegate Latin American countries, not only compared to the leaders, the US and China, but also directly compared to follower countries such as Great Britain, Germany or Japan. The fact that a change of government makes it impossible to advance a crucial document opens an uncertain future and puts Argentina at risk of entering the technological frontier late and poorly, losing the opportunity to generate a significant competitive advantage.

The outlook for public investment in R&D has worsened, as it fell during the Frente de Todos government and did not recover the levels of Mauricio Macri's government, much less those of Cristina Fernández's government. On the private sector side, although we have seen that the ArgenIA plan pointed out the low private investment as a problem, we find that according to the latest available statistics, 73% of its companies invest in R&D, and even invest 4% more than the average manufacturing industry invests.

However, this boost from the private sector is insufficient without a profound transformation of the productive structure. In international terms, even if the amounts invested were greater, they would yield meager results, given the poor development of the country's productive sectors. The absence of solid sectors such as information technology, aeronautics or fine chemicals makes any expectation of achieving an increase in investment that would allow the country to compete with more developed countries illusory. The low investment in R&D is the result of a pattern of specialization in industrial activity sectors, which is oriented towards products and production phases that are not very sophisticated compared to other countries. For this reason, it is also possible to risk that even with a high private investment in the R&D sector, the final effect would be limited by the framework of a primary productive structure.

The diagnosis reveals a weakness in the scientific-technological infrastructure in developing countries, and especially in Argentina: outdated educational systems, inefficient legal-administrative mechanisms, non-existent planning, promotion and incentives strongly imbued with political favoritism, shortage of auxiliary staff, remunerations that make full-time performance of personnel impossible, little research in the private sector and little research linked to production in the public sector.

When considering the implementation of AI technologies, in countries like Argentina innovation comes mainly from the import of patents, licenses and know-how, which not only generates the well-known dependence on central countries, since it does not allow these technologies to be incorporated in a convenient and efficient manner, but also discourages internal efforts to innovate. The consequence of an implementation model like this, cannot be other than to deepen the development path of a primary exporting country, instead of redirecting social actors towards a new path that allows them to take advantage of AI to insert themselves into a circle of imperfect competition that generates increasing returns.

Inevitably, the limits of an AI strategy for Argentina are rigidly defined by its productive model based on the exploitation of static comparative advantages, which has led the industry itself to specialize in the processing of raw materials and food, instead of seeking to stimulate more complex and knowledge-intensive sectors. The Argentine problem is not about a State vs. private dichotomy, but about both sectors sharing the same interest in the development of a long-term technological ecosystem that is not subsidiary to the country's primary-export structure.

The belief that the solution to complex problems such as the lack of qualified labor and regulatory issues, the need for infrastructure and the lack of risk capital to undertake innovation projects will be solved as a result of an innovation economy that will emerge on its own as a by-product of the productive apparatus of a primary development model, seems more like a wish than a real possibility.

This is because Argentina's primary-export structure has so far caused governments to opt to retreat to accompanying the development of extractivism and primary activities, choosing winners among sectors with little dynamism. This will achieve nothing other than the absence of technological entrepreneurs, the absence of investors, the absence of trained professionals and the absence of infrastructure and knowledge. The trend in the global production scenario is oriented towards an increasing automation of tasks in the vast majority of production branches, and although it is difficult to estimate with certainty the impact of this change, the distribution of internal income in each country, as well as the distribution of income between countries, will be strongly altered by the development of AI technologies. This will especially affect developing countries, since these technologies are oriented towards saving labor and natural resources, two of the most abundant and cheapest production factors in these countries.