Argentina’s ties with China: pragmatism over politics.
Last edited Sun Mar 6, 2016, 02:39 AM - Edit history (1)
Argentina’s new conservative government is reviewing several major projects to be carried out jointly with China. But despite deriding the joint projects for “lacking in transparency” during his campaign last year, President Mauricio Macri's administration is not expected to put the brakes on an alliance that Beijing itself classifies as strategic.
His centre-left predecessor, former President Cristina Fernández de Kirchner, signed a set of laws in March 2015 that gave rise to a framework agreement with China on economic cooperation and investment, strengthening relations between the two countries.
“We can’t deny China’s weight in the world. It is not in Argentina’s interest to break with China,” said the new Argentine foreign minister, Susana Malcorra, describing their ties as part of “a balanced relationship with the world.”
Macri used a currency swap deal (the exchange of principal and interest in one currency for the same in another) in effect with China since 2014 as the first measure he took to shore up Argentina’s foreign reserves after taking office in December. He also chose Diego Guelar, a diplomat who is considered one of the promoters of the alliance between China and Argentina, as Ambassador to Beijing.
China’s ambassador in Buenos Aires, Yang Wan-ming, pointed out that his country is the third-largest investor in Argentina, and that in the last five years, investments and merger and acquisition operations in Argentina have totaled 8.3 billion dollars.
One of the most emblematic projects to be reviewed is the construction of the Néstor Kirchner-Jorge Cepernic Hydroelectric Complex in Santa Cruz Province, for a total investment of five billion dollars - 85% of which is to be financed by China.
The contract for the project was granted in 2013 to the Patagonia Dams consortium headed by the Argentine companies Hidrocuyo and Electroingeniería and the Chinese firm Gezhboua Group. The complex, which includes the construction of two dams on the Santa Cruz River, will generate 1,740 MW of electricity. This is projected to cover 8% of electricity demand in this energy-strapped country once it has been completed in 2020.
Another large project, agreed to in November, involves the construction of two nuclear plants – the fourth and fifth in the country – with a total investment of some 15 billion dollars. More than half of the parts in the plants are to be produced domestically, and 85% of the financing will likewise come from China.
Allowing these projects to go ahead “will set a good example for substantial China-Argentina cooperation in the future,” Ambassador Yang said.
Apparently, pragmatism appears to have once more taken precedence over political rhetoric.
At: http://www.ipsnews.net/2016/02/argentinas-ties-with-china-pragmatism-over-politics/
