No more special treatment for China in Argentina

Presidents Macri and Xi agree to revise energy and infrastructure deals at New York nuclear summit

China will no longer receive special treatment in its relations with Argentina. In an effort to address contractual ‘errors’ and improve transparency, Argentine president Mauricio Macri announced he will review the more than 20 energy and infrastructure agreements signed between the two countries in February last year.

Macri met with Chinese counterpart Xi Jinping in Washington last week on the sidelines of the 4th Nuclear Security Summit, and while President Xi also indicated a willingness to go over the deals, both reaffirmed their desire to build on the relationship.

“Support [from China] is key to Argentina’s return to the world. The support we receive in infrastructure should increase. I invite Chinese companies to come to the country, not only in the energy sector, but also to build bridges, trains, and roads,” Macri said.

Macri also encouraged China to expand economic activity into what he suggested were unproductive arid and flood-prone areas of Argentina.

The Argentine president made specific reference to the Atucha nuclear and Kirchner and Cepernic hydroelectric projects that he said contained technological errors and issues concerning confidentiality. Prior to his election in November last year, Macri warned that as president he would revise the deals.

Following years of strong Sino-Argentine relations under the administration of Macri’s predecessor, Cristina Kirchner, the election of Macri led to uncertainty among Chinese over his China policy. However, Xi stated on Friday that he was “willing and in agreement” with Macri’s decision to go over the China deals.

“We invite Argentine companies to explore the Chinese market. We wish to expand cooperation in infrastructure, in agriculture, finance, and cultural exchanges,” Xi said, whilst also expressing an interest in cooperating on science, technology and football.

The fact that the two heads of state met shows that Argentina is increasingly “open to the world,” according to Susana Malcorra, Argentina’s Minister of Foreign Affairs.  Macri and Xi will meet again in Hangzhou at the summit of the G20 group.

A “mature” relationship

Argentina’s state policy is to maintain relations with all the countries of the world, but China is a strategic partner, Malcorra told Diálogo Chino. However, she added that the South American country wants the relationship to develop in a “mature” manner.

“We believe that relations must be transparent and public. We must be very careful with secrecy provisions and ensure that they follow the rules of the market,” Malcorra said.

According to Margaret Myers, director of the China and Latin America program at the Inter-American Dialogue, Macri’s meeting with Xi was motivated by both economics and diplomacy: “China will no longer get the same treatment as it did during the Kirchner period. Even so, this relationship will remain strong and may grow even more under the Macri government,” Myers told Diálogo Chino.

“The relationship between China and Argentina and ultimately, the region, is still unbalanced. But President Macri seems to be trying to correct this,” Myers said, adding that there are clear indications that change, although slow, is already underway.

R. Evan Ellis, a Latin America expert at the Strategic Studies Instituteof the US Army War College, suggests that this may be the first opportunity the Chinese have to develop a legitimate “win-win” relationship with Argentina.

“We see Macri as a businessman reaffirming interest in working with the Chinese, with different rules. He’s showing himself as a reliable partner with strong institutions. I can see that the Argentinean president is trying to end the isolation that Argentina experienced under the previous administration,” R. Evan Ellis told Diálogo Chino. 

R. Evan Ellis views Macri’s revision of the China accords as positive and suggests Chinese entreprenuers’ interests will be “safer” when dealing the a government that will respect contracts.

“There are many reasons to be optimistic about the future of the relationship between the two countries. The Chinese are good at negotiating. If you know how to negotiate effectively, you will be able to achieve a credible agreement. But if you negotiate naively, you will not,” he said.