{"id":50058607,"date":"2022-09-20T16:09:58","date_gmt":"2022-09-20T15:09:58","guid":{"rendered":"https:\/\/stage.dialogochino.net\/?p=58607"},"modified":"2023-08-07T20:11:42","modified_gmt":"2023-08-07T19:11:42","slug":"58566-argentina-magdalena-canal-new-route-foreign-trade","status":"publish","type":"post","link":"https:\/\/dialogue.earth\/en\/business\/58566-argentina-magdalena-canal-new-route-foreign-trade\/","title":{"rendered":"Argentina looks to open new route to the sea for foreign trade"},"content":{"rendered":"

Argentina is preparing an international tender for works on the Magdalena Channel, a proposed river passage providing new access for ships entering or leaving the R\u00edo de La Plata and the Paran\u00e1\u2013Paraguay waterway<\/a> \u2013 the route that connects five countries in South America, and through which 75% of Argentina\u2019s foreign trade moves. The project is considered a potential strategic boost by its proponents, but has also been met with controversy and doubts over its suitability.<\/p>\n

Though the river is wide and deep at its Atlantic mouth, the shallower waters and narrowing shores of Argentina and Uruguay create something of a bottleneck for shipping on the R\u00edo de la Plata. Currently, all ships entering and leaving the river \u2013 including those coming from Argentine ports on the Atlantic coast \u2013 have only one option: they must pass along the Punta Indio channel, a 95-kilometre-long route running northwest through Uruguayan waters close to Montevideo.<\/p>\n

The Magdalena route would be built by modifying a natural channel in the Rio de la Plata that runs parallel to the shores of Buenos Aires. The channel is in Argentine waters and aligned with the direction of the river\u2019s currents for 56 kilometres in a south-east direction. The cost of dredging to bring it to 11 metres deep and 150 metres wide, as well as signalling and maintenance costs, is reported<\/a> to be between US$300 million and $500 million.

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Graphic: Dami\u00e1n Profeta \/ Di\u00e1logo Chino<\/figcaption><\/figure>\n

<\/div>\u201cAny ship that wants to enter Argentine river ports through the R\u00edo de la Plata has to pass through an area that is administered by Uruguay and that, in terms of sovereignty, is a central point for promoting the Magdalena Channel,\u201d says Florencia Di Prinzio, an economic analyst at the Argentine Political Economy Centre (CEPA).<\/p>\n

CEPA recently published a report<\/a> in which it argues that the Magdalena Channel is a convenient alternative access route to the La Plata Basin that would provide financial and socio-economic benefits.<\/p>\n

Among the main benefits it highlights are improvements in navigation times, lower costs for national navigation services, increased income from services that are currently provided exclusively by Uruguay, and better connectivity of river and sea. The channel would give increased autonomy for Argentina in its foreign trade, since shipments would no longer have to pass through Uruguayan jurisdictional waters.<\/p>\n

The new channel would also be wide enough to allow for two-way traffic. The current Punta Indio channel is a single lane, which generates frequent delays in the entry and exit of ships, increasing the costs associated with the transport of exported or imported goods. In this regard, CEPA emphasises that a double lane channel will also \u201cimprove the safety conditions for river transport\u201d.<\/p>\n

Strategic role<\/h2>\n

Di Prinzio states that there are two \u201ckey factors\u201d in their support for the Magdalena Channel: the need to retain dollars in the country and to stimulate the entry of more foreign currency. \u201cIn that sense, the genuine generation of foreign currency is the central point of this project,\u201d she says.<\/p>\n

With the Punta Indio Channel as the only entry and exit route, Uruguay benefits, because \u201c65% of the delays in the Paran\u00e1\u2013Paraguay waterway occur there and all the services generated by this wait are exploited by Uruguay,\u201d according to CEPA.

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