viernes, 27 de mayo de 2022

viernes, mayo 27, 2022

Argentina’s Once and Future Friend

The competition with China is forcing Washington to be more proactive in the region.

By: Allison Fedirka


The U.S. and Argentina have had a complicated and often sour relationship over the past 50 years. 

The U.S. backed violent political repression in Argentina as part of Operation Condor and surprised Buenos Aires by backing the British in the Falklands War. 

It also imposed the Washington consensus on Argentina, an economic order the U.S. advocated to bring the region in line with U.S. practices. 

This ultimately backfired in a massive 2001 economic crisis in which Argentina was largely left to fend for itself. 

Since then, a series of populist governments that oppose the U.S. have ruled the country. 

Put simply, Washington is hardly considered a stalwart Argentine ally.

It's against this backdrop that Chinese overtures in Argentina should be viewed. 

Beijing is positioning itself as an alternative source of trade, financing and investment. 

And though this kind of diplomatic behavior isn’t anything new, even in Latin America, Washington is starting to become more proactive, trying now to be the friend to Argentina it’s failed to be in the past. 


But it’s important to note that the U.S. doesn’t have to be as overtly antagonistic to Argentina as it is to clearly anti-U.S. governments like Cuba and Venezuela. 

Argentina is simply too far away to be the geostrategic concern the others are. 

Still, Argentina’s size and its plentiful natural resources make it an attractive entry point for China as it tries to supplant U.S. influence in the Western Hemisphere. 

Washington can’t afford to ignore Argentina if it wants to have a safe and secure backyard – a prerequisite for projecting power globally.

This is why Washington has abandoned the stick for the carrot, hoping to regain influence by engaging Buenos Aires on matters of mutual interest. 

A series of high-level meetings between U.S. and Argentine officials over the past week makes as much clear. 

On April 22, the Argentine president’s secretary of strategic affairs met with the U.S. national security adviser and the senior director for the Western Hemisphere at the National Security Council to discuss financial relations, food security, energy resilience, information technology, satellite technology, communications and clean energy. 

The secretary also met with officials from the U.S. Treasury, the International Monetary Fund and the World Bank. 

Then on April 26, the head of U.S. Southern Command met separately with Argentina's vice president and defense minister to discuss military training and equipment for the armed forces. 

All of the topics of conversation revolve around areas in which China has helped Argentina meet its strategic needs – nuclear technology, lithium procurement, space and defense. 

(That the U.S. is tackling these topics head-on suggests Washington has a new strategy in place to help secure U.S. interests in Argentina.)

Nuclear technology in particular figures prominently in Argentina’s priorities for energy and climate change. 

It not only provides large-scale generation with a long lifespan but also reduces dependence on fossil fuels. 

At the end of March, the Argentine government awarded China a contract for the construction of the Atucha III nuclear reactor. 

Beijing will also provide 85 percent of the financing for the project, valued at $8.3 billion. 

Shortly after the announcement, in early April, the U.S. sent a delegation to Buenos Aires led by the deputy assistant secretary for nonproliferation policy to discuss Washington’s concerns over China’s participation in the project. 

The delegation spoke directly with the ministers of productive development, science and technology and defense, as well as with the head of the Argentine Cabinet, the vice chancellor and, again, the president’s secretary of strategic affairs. 

Specifically, the U.S. expressed serious concerns over the control and safety of certain kinds of Chinese tech and raised the possibility of China stealing some of Argentina’s technology.

Lithium production and processing are similarly important. 

Lithium is arguably the element with the most strategic future applications in civilian and military sectors, and its use in battery tech comports with many of Argentina’s objectives in clean energy. 

Chinese industry plays a large role in the extraction and refinement of lithium in Argentina, which currently accounts for 16 percent of global output and 9 percent of proven global reserves. 

Several prominent Chinese companies, including Hanaq, Jinchuan, Zijin and Ganfeng, own the rights to lithium exploration and extraction contracts in Argentina. 

Zijin Mining Group also has a lithium carbonate interest, while Ganfeng Lithium is set to open a lithium-ion battery factory later this year. 

The U.S. government included lithium and rare earth materials in the Defense Production Act, thereby declaring lithium a national interest for the U.S. to secure, be it through domestic production or partner countries. 


Regarding satellite technology cooperation, the U.S. interest primarily stems from security concerns, whereas Argentina wants to develop its own space program further. 

For a country like Argentina, space has become too crowded to ignore in its national defense. 

China, through its construction and operation of the Espacio Lejano Station, already has a substantial presence in Argentina. 

This radio station helps track Chinese satellites, conducts deep space mapping and supports China’s lunar projects. 

China’s Satellite Launch and Tracking Control General has operated the facility since it opened in 2018. 

It also answers to the Chinese People’s Liberation Army.

Earlier this month, Argentina’s science and technology minister said the government intended to advance new space projects with China. 

This is particularly concerning for the U.S., which worries about China’s ability to capture communications from non-Chinese satellites as well as other military uses the station could serve. 

But there’s an opportunity for the U.S. to step in: Beijing permits Buenos Aires only limited access to the Espacio Lejano Station, so Washington could offer a more equitable partnership in the field of satellite development.

The U.S. Southern Command commander’s visit also likely addressed Argentina’s warming military ties with China. 

The U.S. traditionally dominates the Western Hemisphere, but over the years China has increased its defense support for Latin American countries. 

Now, Argentina is interested in updating its fighter fleet, and it’s eying China’s JF-17, which would be one of Beijing’s most advanced weapons sales to Latin America and would lay the groundwork for more major sales and integration in the future. 

A major reason Argentina is looking to China is that a U.K. arms embargo, a relic of the 1982 Falklands War, prevents the sale to Argentina of most Western alternatives because they contain British technology in their ejection seats and air-to-air refueling systems. 

For Washington to help, it would need to negotiate a waiver or offer other military equipment of value to the Argentine armed forces that do not conflict with the U.K. embargo.

Finally, one area where the U.S. can significantly improve ties and outmatch China is through international financing. 

Argentina has been trying for years to regain good standing in world markets, but its poor relationship with the International Monetary Fund has stood in the way. 

Most recently, the government and the IMF have been renegotiating the terms of a $44 billion loan, which largely hinged on U.S. approval. 

To plug the financing gap and prop up its reserves, Argentina in the meantime turned to China. 

In February, Beijing increased its currency swap with Argentina by $3 billion, on top of the $18.5 billion agreed in 2021.

However, that the U.S. and Argentina discussed the normalization of financial relations suggests Washington is becoming more accommodating. 

Buenos Aires’ main issue with the IMF is the political conditions that come with its help. 

This means every IMF agreement requires diplomatic engagement and sign-off, mostly from Washington, since the U.S. is the largest contributor and has the largest vote share. 

Over the weekend, after a series of meetings with IMF officials, Argentina’s economy minister said the country would comply with the terms of the first review of the loan and thank the U.S. national security adviser Jake Sullivan for his efforts in reaching the deal. 

The imprints of a lighter U.S. touch were also visible in IMF statements, which noted that inflation may force some adjustments to targets. 

Equally important was the Argentine secretary of strategic affairs and Sullivan’s shared view that the World Bank and the Inter-American Development Bank should play a leadership role in channeling funds to combat climate change. 

The U.S. has more power over these institutions and could offer more flexibility on loan conditionality, and climate change – in addition to being an important subject for Argentina – is a broad enough category that it would provide many lending opportunities. 

If Washington can unlock more financing for Buenos Aires, and follow through on strategic projects, it will help level the playing field against Beijing.

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