BUENOS AIRES — Argentina’s animation industry will hold its second international festival Oct. 27-28 in Buenos Aires, a move aimed at drumming up more production service business and coin for co-productions to expand output.

Toon expo will bring together local and foreign industryites for conferences, a business mart and competitions. Twenty features will compete for up to $10,000 in prizes along with ad spots, shorts, TV series and videogames.

Attendees will include local animation vet Manuel Gracia Ferre (“Manuelita”) and Tiziana Loschi, managing director of the Annecy Animated Film Festival, as well as Pixar digital-effects designer Juan Buhler, and Maria Laura Moure, an executive producer at Disney-backed Patagonik Film Group in Buenos Aires.

Argentina’s “level of production is very good but it lacks scale, lacks volume,” said Rosanna Manfredi, CEO of Encuadre, a Buenos Aires animated production company behind TV series like “City Hunters” for Fox Latin America. “The way to make this grow is through festivals. We have created this festival so that the world can see what Argentina is doing.”

She believes Argentina can compete with India, South Korea and the Philippines for animation services contracts from such Hollywood majors as Disney, Sony and Warner.

“We want to be an alternative,” she said. “We have a production cost structure that is very advantageous for the big companies.”

Animator wages are low in part because of a weak exchange rate, with 3.12 pesos equaling a $1. It also has talent and a culture more similar to those in Europe and the U.S. than its Asian competitors, Manfredi said.

Even so, Argentina still has to grow. Its animation studios have only 70 or so work stations, fewer than the 200 to 500 in Asia that majors want to ensure that output agreements are met on time, she said.

Argentina wants to produce more original content for local cinema and TV and for export, expanding on B.O. hits like “Manuelita” and “Patoruzito.” The toon pics “El arca” (The Ark), “Isidoro, la pelicula” and “Martin Fierro: La pelicula” were among the top 10 grossers at the box office last year.

“We may not have the scale (of operations) to do a 13-hour series for a major but we can enter into production with a major” to do features and series, she said.

Illusion Studios of Buenos Aires has signed on Nova Scotia-based Copernicus Studios and Spain’s Perro Verde Films for hoodlum satire “Boogie, the Aceitoso,” a 2-D and live-action tooner slated for a 2009 release. It also is working with Israel-based Dori Media Group on the production of a series of telenovelas that will use animated content and technology.

The local industry, too, is pressing federal authorities for regulations to secure it more exhibition, particularly on TV.

This is important for output continuity to keep revenue flowing in, she said. A local studio can invest in computers, technology and the training of talent for an outsourcing project but if it doesn’t land another contract it cannot maintain the structure unless there is a local outlet for productions.