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OPINION AND ANALYSIS | 10-12-2022 04:07

Look north or east? Argentina’s tilt in a bipolar world remains unclear

Beijing’s massive economic promise continues to stymie Washington’s attempts at democratic coalition in the Americas.

Writing in Foreign Affairs magazine at the outset of the 1990s, US political commentator Charles Krauthammer referred to the dissolution of the Soviet Union as the “unipolar moment,” one in which the Western world sought “security and order by aligning its foreign policy behind that of the United States.” 

After half a century of civilisational competition in everything from ice hockey, to space flight, to nuclear weaponry, the US stood unquestionably alone as the world’s sole global hegemon. The collapse of the Berlin Wall meant that nearly all international trade, statecraft and military activities were facilitated by power brokers in Washington DC. Whether smaller nations liked it or not, engagement with the developed world required serious cooperation with US diplomats and a serious respect for its geopolitical dictates.

In the intervening decades, China’s meteoric rise has eroded Washington’s monopoly on power. With a rapidly modernising economy, a consumer base of 1.4 billion and an increasingly forward posture on the world stage, few nations around the world have been able to resist Chinese advances — even while they maintain close ties with Beijing’s democratic rival.

Like many South American populations, Argentines have mixed feelings about the influence of the world’s two competing superpowers. According to data from the Wilson Center’s most recent National Pulse Survey — a study which explores Argentine perceptions of the world order, foreign policy and global issues — the United States is viewed significantly less favourably than China and Russia. The 2020 figures indicate that 46 percent of Argentines have either a “bad” or “very bad” impression of the United States, numbers which were better than only a small handful of nations like Venezuela.

 

Grievances and benefits

The historical bases for anti-Americanism in South America’s second-largest country are varied, though the support of Argentina’s 1976-1983 military dictatorship and the backing of the United Kingdom during the South Atlantic conflict are typically viewed as two of the more brazen and unforgivable instances of Uncle Sam’s imperial overextension.

But aside from these grievances with the United States based on past geopolitical impositions, there are also major, undeniable benefits from seeking out Chinese partnership for its own sake.

As an economy with significantly greater investment in research and development across a range of technologically demanding industries, China is positioned to offer Argentina critical partnership in modernisation. The construction of the Atucha III nuclear power plant in Zárate, Buenos Aires Province, for instance, typifies this sort of venture. The third generation HPR1000 plant, which China is building for a price of US$8 billion, is not a project that the cash-strapped Argentine government is in a position to finance on its own – though it is a project the country desperately needs if it is to reduce its crippling dependence on energy imports, particularly liquefied natural gas.

As the benefactor of massive mineral reserves — particularly the lithium which has proven so valuable in a world transitioning away from fossil fuels — Argentina has the natural resources required to escape its chronic financial insecurity. Extracting and transporting these resources, however, requires a degree of upfront investment which can be prohibitively expensive for Argentine firms. Decision-makers in Buenos Aires who hold more favourable views of the Chinese-Argentine connection have been happy to jump on the opportunities for quick capital, even when doing so has meant assuming precarious levels of public debt from a nation with a long history of predatory lending.

Similarly, Beijing-backed developments in maritime infrastructure have been a matter of contention among Argentines – some viewing Chinese investment in Tierra del Fuego as intolerably compromising national sovereignty and others viewing it as a benign and necessary step toward capitalising on the province’s position as the gateway to Antarctic shipping channels.

“The risk for countries such as Argentina is always the same when dealing with economic powers,” geopolitical strategist Leandro Ocon told the Times. “The trade-off the entanglement comes with is a sacrifice in terms of development and different forms of dependency.”

Given the seemingly inescapable currency crises that hit Argentina, such investment has been seen by successive governments as a critical lifeline for the nation’s fledgling economy.

“China has provided Argentina with US$17 billion in loans since 2007, and it is an enormous importer of Argentina’s farm exports.” Wilson Center Latin American Program Director Benjamin Gedan told the Times. “It recently expanded its line of credit to Argentina, where hard currency reserves are perilously low.”

 

Warnings of Washington

As many Western critics have observed, however, there’s no such thing as a free lunch. And indeed, Argentina’s openness to Chinese investment is starkly discordant with the clear warnings offered by many US officials. It has long been the position of a broad swath of Washington that Chinese investment not only compromises the economic autonomy of Latin American countries, but that it may also manifest itself in ways which advance specific Chinese military interests.

China’s government-funded space station in the Patagonian province of Neuquén, for example, is shrouded in secrecy. And while the official bilateral agreement between nations specifies that the project is for mutual benefit in the field of space observation, there is no monitoring mechanism allowing Argentines to verify the project’s independence from the Chinese military, which oversees Beijing’s space programme.

“The Patagonia ground station, agreed to in secret by a corrupt and financially vulnerable government a decade ago, is another example of opaque and predatory Chinese dealings which undermine the sovereignty of host nations,” warned Garrett Marquis, spokesman for the White House National Security Council, speaking to Reuters.

As the opposition vies to retake the Casa Rosada in next year’s general elections, there is reason to believe Argentina may be on the verge of adopting a more Western-centric foreign policy. Targeted outreach attempts made by the 2015-2019 Mauricio Macri administration, however, have meant the approach to Chinese-Argentine relations is less binary and partisan than in decades past.

“Some members of PRO have deeper ties to the Chinese government than others,” Ocon observed, without naming names. “During the period 2015-2019, relations were mostly pragmatic and cooperative. Although a big percentage of Juntos por el Cambio voters view China’s entanglement with suspicion, there were many deals made during the presidency of Mauricio Macri, and many efforts have been made in recent years in Buenos Aires City (a Juntos por el Cambio political bastion) in favour of Chinese organisations, especially in Belgrano’s so-called ‘Chinatown’.”

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Sam Forster

Sam Forster

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