implications of the global and regional changes for argentina's foreign relations

18
This article was downloaded by: [FU Berlin] On: 05 November 2014, At: 02:37 Publisher: Routledge Informa Ltd Registered in England and Wales Registered Number: 1072954 Registered office: Mortimer House, 37-41 Mortimer Street, London W1T 3JH, UK Journal of Iberian and Latin American Research Publication details, including instructions for authors and subscription information: http://www.tandfonline.com/loi/rjil20 Implications of the Global and Regional Changes for Argentina's Foreign Relations Roberto Russell & Juan Gabriel Tokatlian a a Universidad Torcuato Di Tella , Argentina Published online: 07 Jan 2014. To cite this article: Roberto Russell & Juan Gabriel Tokatlian (2013) Implications of the Global and Regional Changes for Argentina's Foreign Relations, Journal of Iberian and Latin American Research, 19:2, 251-267, DOI: 10.1080/13260219.2013.853356 To link to this article: http://dx.doi.org/10.1080/13260219.2013.853356 PLEASE SCROLL DOWN FOR ARTICLE Taylor & Francis makes every effort to ensure the accuracy of all the information (the “Content”) contained in the publications on our platform. However, Taylor & Francis, our agents, and our licensors make no representations or warranties whatsoever as to the accuracy, completeness, or suitability for any purpose of the Content. Any opinions and views expressed in this publication are the opinions and views of the authors, and are not the views of or endorsed by Taylor & Francis. The accuracy of the Content should not be relied upon and should be independently verified with primary sources of information. Taylor and Francis shall not be liable for any losses, actions, claims, proceedings, demands, costs, expenses, damages, and other liabilities whatsoever or howsoever caused arising directly or indirectly in connection with, in relation to or arising out of the use of the Content. This article may be used for research, teaching, and private study purposes. Any substantial or systematic reproduction, redistribution, reselling, loan, sub-licensing, systematic supply, or distribution in any form to anyone is expressly forbidden. Terms & Conditions of access and use can be found at http://www.tandfonline.com/page/terms- and-conditions

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Page 1: Implications of the Global and Regional Changes for Argentina's Foreign Relations

This article was downloaded by [FU Berlin]On 05 November 2014 At 0237Publisher RoutledgeInforma Ltd Registered in England and Wales Registered Number 1072954 Registeredoffice Mortimer House 37-41 Mortimer Street London W1T 3JH UK

Journal of Iberian and Latin AmericanResearchPublication details including instructions for authors andsubscription informationhttpwwwtandfonlinecomloirjil20

Implications of the Global and RegionalChanges for Argentinas ForeignRelationsRoberto Russell amp Juan Gabriel Tokatliana

a Universidad Torcuato Di Tella ArgentinaPublished online 07 Jan 2014

To cite this article Roberto Russell amp Juan Gabriel Tokatlian (2013) Implications of the Global andRegional Changes for Argentinas Foreign Relations Journal of Iberian and Latin American Research192 251-267 DOI 101080132602192013853356

To link to this article httpdxdoiorg101080132602192013853356

PLEASE SCROLL DOWN FOR ARTICLE

Taylor amp Francis makes every effort to ensure the accuracy of all the information (theldquoContentrdquo) contained in the publications on our platform However Taylor amp Francisour agents and our licensors make no representations or warranties whatsoever as tothe accuracy completeness or suitability for any purpose of the Content Any opinionsand views expressed in this publication are the opinions and views of the authorsand are not the views of or endorsed by Taylor amp Francis The accuracy of the Contentshould not be relied upon and should be independently verified with primary sourcesof information Taylor and Francis shall not be liable for any losses actions claimsproceedings demands costs expenses damages and other liabilities whatsoeveror howsoever caused arising directly or indirectly in connection with in relation to orarising out of the use of the Content

This article may be used for research teaching and private study purposes Anysubstantial or systematic reproduction redistribution reselling loan sub-licensingsystematic supply or distribution in any form to anyone is expressly forbidden Terms ampConditions of access and use can be found at httpwwwtandfonlinecompageterms-and-conditions

Journal of Iberian and Latin American Research 2013 Vol 19 No 2 251ndash267 httpdxdoiorg101080132602192013853356

Implications of the Global and Regional Changes for Argentinarsquos Foreign Relations

Roberto Russell and Juan Gabriel Tokatliandagger

Universidad Torcuato Di Tella Argentina

The article examines the implications of global power redistribution processes for Argentinarsquos foreign relations focusing on the relative loss of centrality of the United States in the Southern Cone the ongoing consolidation of a South American system with Brazil as the main power and the re-emergence of China and its growing interest in South America The period studied extends from the turn of the century until 2012 Argentina responded to these changes in a complex and distinct manner A strategy of lsquocouplingrsquo with the United States was replaced with that of lsquolimited oppositionrsquo Towards Brazil Argentina has pursued a strategy of accommodation seeking to maximize benefits while retaining as much autonomy as possible Finally with China Argentina has practiced a strategy of lsquoreliable engagementrsquo which has provided clear dividends but appears to be reaching exhaustion We conclude by putting Argentine relations with these three countries into broader perspective

Keywords Argentina foreign policy Brazil USA China South America coupling limited opposition

Latin America has always been a peripheral region in the world system This condition has

made the area both vulnerable and sensitive to international circumstances and global

changes Therefore external variables have been decisive in the way that Latin American

countries have defined and oriented their insertion into the world throughout their entire

life as independent nations Argentina for example could extract extraordinary benefits

from the complementary links it established with Great Britain over the half-century from

1880 to 1930 When global conditions changed Argentina was forced to develop a new

international strategy and spent many years muddling through by trying to respond and

adapt to a changing and less favourable international context

During the nineties under President Carlos Saul Menem Argentina put into practice a

foreign policy model which we have called lsquopragmatic acquiescencersquo as a response to the

global change that resulted from the Western victory in the Cold War and the advancement

and extension of globalization1 As no other country in the region Argentina decided to

lsquojoin the Northrsquo assuming that the onset of a new era in international and inter-American

relations would be dominated by US hegemony resulting in the expansion of liberal

democracy market reforms and free trade agreements

These examples help us understand the implications of systemic changes in the

international insertion of countries like Argentina2 Each of these changes (1914 1945 and

1989) determined the end of a cycle of foreign policy and unleashed strong internal

debates about the degree of openness of the economy to foreign trade the development of

the domestic market industrialization strategies and the external alliances that should be

Email russellrobertogmailcom daggerEmail jtokatlianutdtedu

q 2013 Association of Iberian and Latin American Studies of Australasia (AILASA)

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2014

252 R Russell and J G Tokatlian

favoured3 In each cycle the nature and strategic meaning of relations between Argentina

and the United States and the neighbouring countries of South America were the main

topic of discussion At present and in contrast to the Cold War years and the nineties

relations with both counterparts are developing in a context marked by a novel process that

has two visible faces the erosion of the United States hegemony in South America and the

progressive consolidation of a specific South American subsystem mainly in the Southern

Cone characterized by the emergence of Brazil as a sub-regional power In this scheme

the previous dominant power the United States is no longer central to Argentina while the

emerging power Brazil plays an increasingly important role for the countryrsquos

international relations In both cases asymmetry defines bilateral relations4 The greater

asymmetry of power with the United States weighs less in the relationship due to

Washingtonrsquos declining interest attention and influence in Argentina Indeed the most

powerful actor has lost a great part of its structural power to shape the structure of the

relationship As a consequence its relational power has also weakened that is its capacity

to make Argentina follow its desires and interests has waned significantly5 The minor

asymmetry with Brazil has become a structural feature of bilateral relations and exercises

on Argentina a different effect than the classic asymmetry with the United States for two

main reasons it does not have the magnitude of the former and it occurs in a geographical

area ndash South America ndash that has unique characteristics regarding interstate cooperation and

competence The sub-regionhas someof the features that define a subsystemofhierarchy a) a

main power that is expected to help order the system and to use its power judiciously and b) a

set of shared expectations about state behaviour based on updated information about state

preferences and intentions shared experiences as well as a deep history that reduces

the security dilemma6 At the same time it exhibits elements which distinguish it from

the hierarchic model These are mainly the absence of a central dominant nation and a set

of shared expectations of rights and responsibilities for both the major and the secondary

powers

The sub-region also has a long and distinctive history of interstate peace and

pacific resolution of conflicts that has been fundamental for mitigating the security

dilemma The countries that comprise it are showing remarkable levels of cooperation

Moreover the main power (Brazil) has good relations with all its neighbours and

there are no foreseeable state threats coming from them Within this context and

under this particular form of asymmetry Argentina and Brazil have found a way not

always easily to accommodate each other At the same time and as in other moments

of redistribution of global wealth and power relations with new regions or countries

also occupy an important place in Argentinarsquos foreign policy agenda After World

War II and throughout the Cold War the Soviet Union and the socialist bloc were

important partners They offered the country technology and key markets for

Argentine exports that faced increasing access restrictions with traditional clients

particularly in Europe Today the focus is Asia especially China as a new and

essential counterpart for Argentina For its part the European Union continues to lose

ground as a key partner a process that has been intensified in recent years by the

EUrsquos relative loss of power international prestige and influence

The question that guides this paper is the following What are the implications of three

particular and key aspects of the overall process of redistribution of power and diffusion of

wealth for Argentinarsquos foreign relations We refer to the relative loss of centrality of the

United States in the Southern Cone the ongoing consolidation of a South American

system with Brazil as the main power and the re-emergence of China and its growing

interest in South America The period under study extends from the beginning of the

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2014

Journal of Iberian and Latin American Research 253

century to the present Argentina has responded to each of these developments in a distinct

manner With the United States it has abandoned the strategy of lsquocouplingrsquo and has

implemented a strategy of lsquolimited oppositionrsquo 7 Towards Brazil Argentina has pursued a

strategy of accommodation seeking to gain benefits but also to retain as much autonomy as

possible Finally vis-a-vis China Argentina has practiced a strategy of lsquoreliable engagementrsquo

that has provided clear benefits but which also seems to be exhausting

Relations with the United States Brazil and China are analysed respectively in the two

following sections The focus of our work is placed on the implications of global and

regional changes in the foreign relations of Argentina It is important to note that these

changes do not fall into Gilpinrsquos category of lsquosystemic changesrsquo The changes to which we

refer here belong to a long duration historical cycle that is still in progress and which is

marked by the redistribution of power and wealth from West to East and from North to

South in the context of globalization8 The resultant changes offer unprecedented

opportunities and challenges to most Latin American countries and demand to a large

extent a rethinking of foreign policy its priorities and exercise The paper concludes with

a section in which we try to put into perspective Argentinarsquos relations with the three above

mentioned countries

The United States and Brazil Losing and Gaining Centrality

Argentina-United States relations have experienced significant changes since the

beginning of the twenty-first century The events of 911 in the United States relegated

Argentina to an even less important position from that it had occupied in the George

W Bush administrationrsquos already reduced Latin American agenda Moreover

Washingtonrsquos decision not to support Argentina when the country defaulted on its debt

in late 2001 was read in Buenos Aires and other Latin American capitals as a clear sign

that lsquocouplingrsquo with the United States goes unrewarded and that the time of the

Washington Consensus was coming to an end Most of the Peronists back in government

after the financial crisis found fresh arguments to criticize Washingtonrsquos coldness as well

as the recipes of the IMF and the neoliberal policies pursued by the country in the nineties

From this moment onwards bilateral relations were gradually dominated by two main

trends the loss of US centrality in the foreign policy of Argentina and the growing

indifference of Washington vis-a-vis Buenos Aires

During the first months that followed the crisis Argentina opted for a lsquoselective

rapprochementrsquo with the Unites States rather than merely band wagoning At that time

Washingtonrsquos role was considered central for overcoming the crisis because of its

influence in the multilateral lending institutions Emboldened by the first signs of

economic recovery Eduardo Duhaldersquos transition government (2002 ndash 2003) began to

voice its opposition to some policies of Washington at the end of his short administration

for example to the US military intervention in Iraq The rapid and even startling recovery

from the crisis and the high growth of Argentinarsquos economy in subsequent years

strengthened the idea in Buenos Aires that the country could grow and develop without

Washington and certainly against its economic prescriptions This notion was reinforced

after the March 2005 agreement with private creditors of the debt in default (76 of the

bondholders) and the cancelation in January 2006 of the US$98 billion debt with the IMF

in a single payment using reserves of the Central Bank Thus over a period of around three

years the United States ceased to be seen as an lsquoindispensable nationrsquo for Argentina

The idea that Argentina could do for the most part without strong ties to Washington

had clear ideological components that came from the inner circle of the Nestor Kirchnerrsquos

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254 R Russell and J G Tokatlian

administration (2003 ndash 2007) However it found its greatest support in the material

conditions offered by a global and regional scenario that opened new and extraordinary

opportunities to the country China became a key trading partner and Brazil behaved as the

closest country to Argentina during and in the years following the crisis Meanwhile the

United States did not devote much time to Argentina let alone the wider South America

This fact was much more than the mere repetition of the United States tendency to put

Latin America in a secondary position in its foreign policy concerns It has to be situated in

the context of the long-term process of U S hegemonic decline in South America

especially in the Southern Cone countries

More specifically the low strategic relevance of Argentina for the United States helps

explain the growing indifference of Washington towards the country This fact is not new

but has intensified during this century Argentina does not have a prominent place in any of

the priority issues on the United Statesrsquo Latin American agenda trade migration drugs

terrorism and public safety and energy A second factor that also explains Washingtonrsquos

estrangement from Buenos Aires is a sequence of bilateral conflictive episodes of high-

voltage in which Argentina played or was seen to play the role of the actor less open to

dialogue and more prone to overacting Vocal criticism on the Argentine side first to the

IMF and later to Washingtonrsquos policies past and present became louder as Argentinarsquos

economy recovered The climax came at the Fourth Summit of the Americas held in Mar

del Plata on November 4 and 5 2005 where the then president of Argentina Nestor

Kirchner firmly opposed lsquoneoliberalismrsquo and the creation of a hemispheric free trade area

(FTAA) and accused the United States of having an lsquoanachronistic viewrsquo of the problems

afflicting developing countries Moreover he called on Bush to have a more responsible

leadership in Latin America by ending his support for policies that had lsquonot only led to

misery and poverty but also the fall of democratically elected governmentsrsquo9 Mar del Plata

marked a turn for the worse in bilateral relations and Washington was left with a bitter taste

that would linger until the end of George W Bushrsquos presidency Moreover while the so

called lsquoArgentine modelrsquo heterodox and lsquoneo-developmentalistrsquo in its economic

orientation did not fit into the category of lsquoLatin American radical populismsrsquo it was

viewed by US officials with suspicion and disgust Although Nestor Kirchner never

subscribed to the tenets of the lsquosocialism of the twenty-first centuryrsquo Washington watched

with dissatisfaction the close links established betweenArgentina and Venezuelarsquos Chavez

After the inauguration of Cristina Fernandez de Kirchner to the presidency of

Argentina in December 2007 new conflicts contributed to deepen lsquomutual detachmentrsquo

Barack Obamarsquos arrival in office in January 2008 was considered by Buenos Aires as an

opportunity to open a new dialogue Moreover the financial crisis in the United States

merely reinforced government beliefs and policies on the role of the state in the economy

and on the need to reform the multilateral lending agencies However with its first

domestic and foreign policies the Obama Administration soon showed that the ideological

affinities world views and purposes were less similar to what at first could have been

imagined at the Casa Rosada President Fernandez de Kirchner rapidly moved from initial

lsquoadmirationrsquo to conclude that President Obama lsquohad not fulfilled the expectationsrsquo and that

his Administration lsquoignores the needs of the Southern Conersquo10

Over the years the distancing on global and regional issues became apparent the threat

and the use of force in the Middle East Central Asia and Northern Africa the conception

and practice of the lsquoResponsibility to Protectrsquo the statehood condition of Palestine the level

and scope of protectionism the promotion and enforcement of stronger financial regulations

worldwide the approach vis-a-vis specific countries such as Iran the half-century old

Cuban blockade the debate and reform over crucial aspects of the Inter-American system

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Journal of Iberian and Latin American Research 255

such as the Inter-American Defence Board and the Inter-American Treaty of Reciprocal

assistance the differences in views and attitudes vis-a-vis a sort of lsquoneo-coupismrsquo

(neogolpismo) in the region such as in Venezuela (2002) Honduras (2009) Ecuador (2010) and Paraguay (2012) and the broadening and militarization of the lsquowar on drugsrsquo However

a simultaneous convergence on important world and continental topics has been evident

acting in favour of nuclear non-proliferation avoiding the presence of transnational

terrorism in the area (for example in the Tri-border zone of Argentina Brazil and

Paraguay) supporting the human rights component of the Inter-American system and

participating in humanitarian missions such as the one in Haiti

In brief by the end of the first year of the second mandate of President Fernandez de

Kirchner and after the re-election of President Obama for a second term the bilateral

relationship remained characterized by little presidential dialogue low shared-

expectations outspoken differences and specific cooperation only on issues of common

interest Key coincidences and several major differences have not been institutionalized in

a general framework by which the mixture of consensus and dissent could be managed On

many occasions first and second-level government officials in Washington and Buenos

Aires overreacted to an incident or underplayed an accord In most cases the perception at

the highest level of each government was one of misunderstanding tiredness and

discomfort

Within this context the fact that Argentina will occupy a non-permanent seat on the

UN Security Council in 2013 ndash 2014 where critical issues will be on the agenda (some of

significance for Buenos Aires including the Malvinas-Falkland question as well as the

lsquovulture fundsrsquo suing Argentina in US courts regarding the 2001 debt default) Requiring

Washington to play a positive role may generate a situation that pushes both countries to

at least devise an improved consultative mechanism in order to handle their relationship

with more maturity and realism

Relations between Argentina and Brazil have been marked by the increase in

asymmetries between the two countries in terms of capabilities as well as in international

projection Since the crisis of 2001 Argentina has undergone a gradual process of

economic and self-esteem recovery whereas Brazil has consolidated its position as an

emerging power both regionally and globally These developments together with the loss

of US centrality in South America and Mexicorsquos growing links and interdependence with

North America have dramatically altered the geopolitical landscape in Latin America

particularly in South America

Three distinct phases can be highlighted in the Argentine-Brazilian relationship

since the beginning of the twenty-first century11 The first extends from the crisis of

2001 through 2003 and is characterized by the growing importance given to Brazil by

the elites and public opinion in Argentina While other governments were abandoning

Argentina the Fernando Henrique Cardoso Administration expressed solidarity with

the government led by Eduardo Duhalde during the time of crisis arguing that the

International Monetary Fund could not be insensitive to the serious situation which

afflicted Argentina and said that Brazil continued to trust in its main Mercosur

trading partner Later with Lula already in the Planalto the idea of Brazil as

lsquoalternative development modelrsquo to the one implemented in the 1990s and as the

lsquomain cardrsquo of Argentinarsquos international insertion became dominant in Buenos Aires

Nestor Kirchner took office in May 2003 stating Brazilrsquos importance for Argentina

and emphasized the need to give more weight and density to a common strategic

project However this positive vision of the bilateral relationship was expressed at the

beginning of a phase in which Argentina was leaving behind the crisis With gradual

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256 R Russell and J G Tokatlian

recovery came the revival in Argentina of an ambiguity vis-a-vis Brazil Although

Brazil was seen as a key player and partner it also raised suspicions and doubts

throughout the whole Argentine political spectrum Its status as an emerging power

produced concerns For the Right in Argentina the Lula presidency gave reasons to

refloat the perception of Brazil as an lsquoincorrigiblersquo country The different assessments of

the strategic condition of South America vis-a-vis Latin America also reappeared and with it

fears of a possible Brazilian hegemony in South America The government of Fernando de la

Rua (1999ndash2001) had had a preventive and defensive attitude about the political idea of South

America proposed by Brazil ndash a political and economic geographic area with its own

peculiarities and different from the lsquoLatin America of the Northrsquo The government of Nestor

Kirchner also adopted a reluctant position An eloquent example of this attitudewas President

Kirchnerrsquos decision not to attend the gestation of the South American Community of Nations

meeting (prior to its transformation into the Union of SouthAmericanNations) in 2004 on the

grounds that it was an instrument created by Brazil to project and ensure its own power in

the region

References to Brazil arose in the context of a stagnating Mercosur Repeated promises

to give the bloc a new birth ndash the so called lsquorelanzamientorsquo ndash could not hide that in terms

of its economic significance Mercosur exhibited clear signs of exhaustion Moreover

similar views in both capitals about the lsquodevelopment modelrsquo did not help to give more

oxygen to the integration process The convergence between Kirchner and Lula on the

need to restore the lsquoindustrialistrsquo vision of integration as opposed to the lsquocommercialrsquo

approach of the nineties gave the impression that the two countries were ready to give its

ties a new strategic perspective However the bilateral agenda of lsquoproductiversquo integration

and Brasiliarsquos acceptance of the importance of the lsquore-industrializationrsquo of Argentina were

interpreted in Buenos Aires as a right to establish protectionist measures for Brazilian

exports that threatened the national industry and even more to ignore certain rules This

propensity for defensive policies not only emphasized the lsquofatiguersquo of Mercosur but also

contributed to the low willingness on the part of Brasilia to accept limits to the

autonomous management of its foreign policy Integration never ceased to be a goal for

Brazil but with time acquired a minor role in the priorities of its foreign policy Its

systematic rejection of a surrender of elements of sovereignty and autonomy to the

Mercosur was one of the determinants of the institutional weakness of the bloc Moreover

as Monica Hirst has put it lsquothe importance of the South American economies as a space for

a larger expansion of the Brazilian companies and the statersquos presence as an investor

(Petrobras) and financier (BNDES) [Brazilian Development Bank] became more

important for Brazilian material and strategic interests that the regional integration

process especially the Mercosurrsquo12 In short ambiguous perceptions coexisted in

Argentina with fluctuating bilateral relations The setting was propitious for the

reappearance of anti-Brazil perceptions in Argentina The pro-Brazilian episodic euphoria

of the years of Duhalde (Brazil as a lsquogreat strategic allyrsquo) turned into doubt and criticism in

the second phase which goes from the beginning of 2004 to the end of 2006 Explicitly

and implicitly by both the Right and the Left an ambivalent feeling towards Brazil

unfolded albeit without the pugnacity of the past but nevertheless highlighting the

difficulties of embedding a culture of friendship between the two countries13

As in other debates in Argentina these visions were remnants of perceptions forged in

the seventies and nineties Kirchnerrsquos own ambiguities style and measures in government

did not help to build a more positive image of the role of Brazil for Argentina Several

groups located in the Ministry of Foreign Affairs the business world think-tanks and the

media encouraged the counterbalancing of Brazil in lsquoSouth Americarsquo by means of a

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ovem

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2014

Journal of Iberian and Latin American Research 257

lsquoLatin-Americanrsquo policy in which the role of Mexico was presented as crucial On the

other hand the vision of Chile as a partner for a more balanced South America and as an

economic model also regained strength in a wide spectrum of the Argentine elites covering

the Right to the centre-Left Chilersquos image was contrasted with that of Brazil The first was

seen essentially as lsquopredictablersquo and lsquoreasonablersquo while the second after the triumph of

Lularsquos Workers Party tended to be presented on the opposite side For some closer

relations with Chile would serve to offset the influence of Brazil in the Southern Cone ndash a

Santiago ndash Buenos Aires axis to limit the Brazilian aspiration to lead the area ndash while

others perceived the lsquoChilean wayrsquo as the best manner for taking a safe distance from

Mercosur which was perceived as an obstacle to establishing a flexible dense and fruitful

relationship with the rest of the world Finally the Left identified the relationship with

Venezuela as a balancing factor for restraining the power of Brazil

The third phase of Argentine ndash Brazilian relations started at the end of 2006 and

extends to the present An interesting twist can be observed in the direction of a more

positive perception of Brazil that clearly puts it in a central place for Argentina Two main

factors explain this change The first and most important is the growing international

relevance and regional weight of Brazil This process has led to the formation of a

widespread perception in Argentina that defines Brazil as lsquoinevitablersquo with a predominant

negative and generally pessimistic bias or as a country that is lsquoindispensablersquo in this case

emphasizing the possibility of building a common future and a strong cooperative

relationship The idea of Brazil as a necessary country is widely accepted but has

variously been accepted with resignation disgust and joy alternatively viewed as an

opportunity or severe challenge The lsquosuccessrsquo of Brazil is often contrasted with the

lsquofailuresrsquo of Argentina and generates different feelings such as pain envy nostalgia and

desire for emulation In any case the growth and rise of Brazil has converted it into a

model for almost everyone The second factor is the growing density of bilateral relations

As an example it is interesting to note that Brazil is already the fourth largest foreign

investor in Argentina after the United States Spain and China In 2010 24 of total

exports (42 industrial) and 82 of the cars manufactured in Argentina were directed to

the Brazilian market and 863492 Brazilian tourists visited the country14 At the same

time the expansion of Brazilian companies in Argentinarsquos productive activity and trade

has been impressive in the last decade

The main issue for the future then is how to live and interact with the lsquoinevitablersquo or

lsquoindispensablersquo country This convergence of perceptions regarding the centrality of Brazil

for Argentina only goes so far There is no agreement on the political economic and

strategic interests that should constitute the relationship with Brazil and consequently

about the best ways to put them into practice The transition from an entrenched culture of

rivalry to an incipient culture of friendship has lasted more than a quarter of a century

providing promising dividends for both nations and offering a good platform from which

to renegotiate the growing bilateral ties The world and the region and the national

situation of the two countries especially concerning the distribution of attributes of

economic power are now very different to the 1980s when the two countries took the first

steps to build a positive bilateral relationship The double condition of the Argentine ndash

Brazilian relationship that is its increasingly close and uneven character suggests that

there will be a complex combination of convergence and divergence between the two

nations Argentina and Brazil never were Pakistan and India in terms of antagonism and

sought in the past to jointly become an equivalent to the Franco ndash German axis for the

integration of South America an aspiration that today is unsustainable Circumstances

have changed and the condition of lsquoasymmetric interdependencersquo is recognized and

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02

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ovem

ber

2014

258 R Russell and J G Tokatlian

accepted in Argentina although not without the suspicions that characterize the attitudes

of the weaker party in a bilateral relationship In this context the main challenge for

Brasilia and Buenos Aires is to forge a realistic and positive lsquonew dealrsquo that contemplates

with its own specificity the bilateral relationship as well as Mercosur

In the end the above-mentioned three phases show the existence of both a changing

and intricate relationship If the theory of asymmetry is taken into consideration the first

move towards re-negotiating an unbalanced relationship should be initiated to a large

extent by the less powerful party In that sense it is yet unclear what the Argentine elites

(civilian and military economic and intellectual state-based and non-governmental) want

from relations with the continent (including the United States) the Spanish-speaking

region South America and finally Brazil Historically it has been quite difficult for

Argentines to have simultaneous positive relations with Washington and Brasilia In the

last two decades different opinions (sometimes personal more than collective) between

the lsquoLatin-Americanistsrsquo and the lsquoSouth-Americanistsrsquo favouring opposite strategic

options have been vocally expressed Currently several other countries in the area have

been increasing their leverage especially those facing the Pacific This phenomenon does

not go unnoticed by Argentine elites and is another source of domestic debate In this

dynamic and changing regional context Argentina has not been able to clearly establish

the goals and ambitions to guide its foreign policy towards the region and Brazil in

particular The response to this situation should be sought in essence in domestic politics

Relations with China (and Asia) A Historic and Challenging Opportunity

Argentine ndash Chinese links should be placed in the larger context of China ndashLatin America

relations15 From a Latin American perspective Chinarsquos growing presence in the region

has been seen at least in the first decade of the twenty-first century as a promising trend

Chinarsquos ties with Latin America from the 1950s to the 1970s were marginal focused

primarily on cultural diplomacy driven by ideological motives and based on

revolutionary rhetoric This diplomatic strategy relied on the dividends of destabilization

was accompanied by anti-US slogans and was geared toward strengthening pro-Chinese

(and anti-Soviet) political parties and movements Chinarsquos international behaviour during

that period was that of a revisionist actor who sought to change the rules of the game

through aggressive means

In contrast Beijingrsquos approach to the region since the 1990s has involved an active

economic diplomacy characterized by pragmatism conciliation and stability Chinarsquos key

goal and main challenge has been to deepen its relations with the countries of Latin America

without irritating Washington Diplomatically China has proceeded in a judicious fashion

which explains in part why regional forces did not emerge to veto a policy of prudent and

consistent engagement toward China In addition Chinarsquos external diplomatic model has

been seductive to Latin America especially during the two administrations of George

W Bush in the United States multipolarism as opposed to unipolarism multilateralism as

opposed to unilateralism non-interference as opposed to interventionism soft power as

opposed to hard power pragmatism as opposed to ideologisation collaboration as opposed

to domination and persuasion as opposed to coercion All have been attractive notions in

Latin America Chinarsquos contemporary approach coincides with strong Latin American

traditions and aspirations and has become more captivating by virtue of the mishandling

disregard and thoughtlessness of US foreign policy towards the region

Nothing indicates that Latin America is geared towards accepting a paternalistic

externally-induced security dilemma with China and the region does not feel insecure visshy

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Journal of Iberian and Latin American Research 259

a-vis Beijing despite certain ideologically-driven pressure groups in Washington

Moreover the Sino ndash Latin American ndash US triangular relationship has not engendered

major tensions or unmanageable challenges16 There is also nothing to suggest from a

regional viewpoint that Latin America ndash China ndash United States relations are destined to an

apocalyptic geopolitics approach based on an overblown fear of an alleged Chinese

takeover of the region China is not the Soviet Union post 911 is not a rehearsal of the

Cold War Washington is no longer at the pinnacle of world power and Latin America has

not collapsed after the Western economic and financial crisis began in 2008 There is also

no indication that Chinarsquos intention is to challenge the United States in the Western

Hemisphere In fact the Chinese government has actively sought to convince the United

States and the rest of the world that its intentions are benign thus the self-portrayal of a

peaceful rise

Chinarsquos behaviour in Latin America at the outset of the twenty-first century has been

far from that of a revisionist power On the one hand Beijingrsquos strategy has combined

necessity with opportunity and has been put into practice cautiously and diligently

curtailing the likelihood that the region will develop or adopt a policy aimed at rolling

back Chinarsquos presence On the other hand Latin Americarsquos relationship with Beijing is

more dependent on economic facts than political conceptions As there is no major

ideological concern in most countries about dealing with China the crucial element is the

material effect of Sino ndash Latin American linkages the level of dependency of the region

vis-a-vis China the degree of de-industrialization of the area derived from bilateral trade

and the ecological consequences of Chinese investment in Latin America17

This broader framework is essential to understand the dynamics of Argentinarsquos

relations with China in the larger context of Argentinendash Asian links Over the past two

decades the (re)emergence of China and the ascent of Asia have been a blessing for

Argentina Rising demand and higher prices for commodities have made it possible for

Argentina to elevate and diversify its trade flows with the East Since the 1990s and

despite the discernible differences in economic and foreign policies between Carlos

Menem and the Kirchners Argentina has developed a new pattern of production that has

led notwithstanding the crisis of 2001 to a reorganization of the economic base of the

country As noted by Pablo Gerchunoff lsquoIt is not just about the speed of exports there is

also a significant diversification traditional agriculture new agriculture industry energy

and mining concurred to modify the national economic landscapersquo18 In that context and

according to President Nestor Kirchner it was crucial lsquothrough China to search in Asia the

leverage to re-industrialize Argentinarsquo Economy not politics has been the driving force

to improve and extend Argentine relations with the East19

For the first time in more than seven decades Argentina has met a world that eagerly

requires what it produces The key driver of this demand is located in China but covers a

wide range of countries At present China is Argentinarsquos second largest trading partner

both in terms of the origin of imports and recipient of exports ndash in both dimensions after

Brazil and before the United States (See Table 1) Argentina meanwhile ranks third in the

list of the 15 major suppliers of agricultural products which supplied 90 per cent of

Chinese imports in 2010 United States (244) Brazil (136) and Argentina (73)

Other major suppliers were the European Union (6) Australia (5) and Malaysia (5)

By 2001 Argentine exports to China surpassed the US$1 billion barrier to hit US$1123

billion and imports totalled US$1066 billion Thus there was a small surplus of US$56

million in favour of Argentina By 2010 the commercial exchange was worth US$13795

billion totalling US$6117 billion in Argentine exports and US$7678 billion in Chinese

exports The result was a trade balance of US$1561 billion in Chinarsquos favour20 In the

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260 R Russell and J G Tokatlian

period January ndashSeptember 2011 the surplus in favour of China grew While Argentine

exports amounted to US$4746 billion Chinese exports came to US$7569 billion21

India is Argentinarsquos main Asian trading partner after China22 Other important

countries are Indonesia South Korea Malaysia Vietnam and Thailand23 By 2010 when

China implemented barriers to Argentine soybean oil in retaliation for local action that

prevented the entry of Chinese products into the country Argentina reoriented its soybean

exports to India which bought 14 million tons of soybean oil (corresponding to US$12

billion dollars) In September 2011 Indiarsquos ambassador in Argentina said his country

would increase demand for soybean oil over the next ten years from the current 8 million

to 15 million tons representing a significant additional opportunity for Argentine

producers and exporters24

Indeed ties with Asia are not limited to trade Again the paradigmatic case of this

new relationship is China which in recent years has also emerged as an increasingly

important financial actor During 2009 at a high point of the US-originated financial

crisis China and Argentina agreed to swap US$10 billion worth of their currencies in

order to enable Argentina to avoid using dollars in trade between both countries an

agreement that was the first of this sort between China and a South American country25

Beijing simultaneously accelerated its investment in agriculture mining energy and

banking and has become the third largest investor in the country (See Table 2)26 In

addition there is strong Chinese interest for participation in infrastructure development

projects in sectors such as railways roads ports and telecommunications The largest

food company in China Heilonjiang Beida-Huang signed an October 2010 cooperation

agreement with the province of Rıo Negro27 which provides China with twenty-year

leases on provincial lands (20000 hectares at an early stage that may eventually extend

to up to 320000 hectares)28 In return the Chinese company is committed to

undertaking major irrigation and infrastructure works as part of a ten-year investment of

US$15 billion dollars29 Different actors from Argentina are also opening trade offices

in Chinese cities and several twin cities and sister provinces have signed different 30agreements

In the oil sector the China National Offshore Oil Corporation (CNOOC) acquired 50

per cent of Bridas Corporation and Sinopec holds 100 per cent of Argentine assets in

Occidental In addition China controls 50 per cent of the Cerro Dragon field and will

handle major reserves for 40 years in the province of Santa Cruz To sum up Beijingrsquos

growing interest in Argentina has meant that the country is according to Levi J Jordan

from the Americas Society lsquoreceiving almost half of Chinarsquos investment in South America

over the past two yearsrsquo31 In that context the growth of Chinarsquos state corporations is

impressive32 Agreements have also been made in the field of defence the most prominent

is the signing of the Memorandum of Understanding for Strengthening Exchanges and

Cooperation in Defense of 16 May 2007 whereby both countries have committed to

maintain contacts to discuss global and regional security issues to cooperate on military

equipment and logistics and to establish a Defence Joint Commission It is worth

mentioning that officers from Argentina together with military from Chile and Colombia

frequently (more often than counterparts from Cuba and Venezuela) have attended courses

on grand strategy at Beijingrsquos elite national defence university PLANDU33 Even though

Argentina is not a significant South American buyer of military equipment34 has a very

low annual defence budget and that China is not the major supplier of arms to the region

(as it is the case of the United States Russia and the European Union) it has lately

considered the acquisition of Chinese Z-11 helicopters35 Finally after a July 2012 visit to

China by Argentine Defence Minister Arturo Puricelli both countries agreed that

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2014

Journal of Iberian and Latin American Research 261

Argentina will construct a prototype of that helicopter by 201336 In general the level of

bilateral military dialogue is highly positive37

In key scientific and technological areas there has been an on-going improvement of

relations For example a Satellite Laser Raging (SLR) system designed and made in China

was installed in the Observatory of San Juan University38 Both countries plan to conduct

collaborative activities for Antarctic expedition39 There are many contacts and joint

initiatives in the areas of telecommunications and space40 The two countries are also

interested in creating a Bilateral Centre on Science and Technology for Food41

In addition China will install a satellite station in the province of Neuquen42 while

incrementing its presence in the telecommunications sector and establishing cooperation

ties in the nuclear field43

Argentina and China share important interests in their diplomatic agenda with regards

to the defence of the principle of lsquoterritorial integrityrsquo China consistently supports the

Argentine claim of sovereignty over the MalvinasFalklands while Argentina defends the

policy of lsquoone Chinarsquo which implies the non-recognition of the independence of Taiwan

and Tibet The issue of the MalvinasFalklands Islands has been surfacing for two reasons

On the one hand as Lyle Goldstein has remarked lsquoChinese defence analysts take such

intense interest in the Falkland Warrsquo due to the fact that according to Chinese government

officials and experts there are certain similarities between the Malvinas and Taiwan44 As

Taiwan is a vital issue for Beijing the understanding of the 1982 war in the South Atlantic

is extremely relevant On the other hand the potential closeness of China and Argentina

may provoke in the future a vulnerable situation with regards to the islands that could

affect British defence policy45 In times of a major economic crisis in Europe and with

diminishing possibilities of sustaining high defence budgets retired military officers from

Great Britain overemphasize Londonrsquos potential weakness in the South Atlantic

With respect to issues on the global agenda the two countries agree at the level of the

G-20 on the need for greater participation of emerging nations in international financial

organizations as well as the need to implement measures for the avoidance of financial

speculation that causes volatility in the prices of commodities Both countries have been

supporting peacekeeping operations and they both participate militarily in the UN Mission

in Haiti At the International Atomic Energy Agency Beijing and Buenos Aires have been

active in the promotion of non-proliferation

It is important also to mention a relatively new phenomenon in the relation between

Beijing and Buenos Aires namely Chinese immigration to Argentina There are

approximately 120000 Chinese and Chinese-descendants in Argentina mainly in Buenos

Aires46 Their point of origin is mostly Taiwan and Fujian and to a lesser extent Hong

Kong Even though there are no good estimates or different in-depth studies lsquoChinese

immigration to Argentina is assumed to be largely of illegal naturersquo with lsquoremittances an

important flow of capitalrsquo and Argentina being lsquoan intermediate stoprsquo for approximately

half of the Chinese migrants before seeking entry into the United States (mainly) or the

European Union47

To sum up the capabilities willingness and needs of both sides make the relationship

between Argentina and China (and Asia) complementary The East needs raw materials

(energy food and mining) and Argentina needs investments and infrastructure Of course

a link of this nature presents opportunities but also brings risks It has become fashionable

in Argentina to compare the current situation with the golden years of the lsquospecial

relationshiprsquo with Great Britain (and Europe) that was undoubtedly the engine of the great

Argentine take off between 1880 and 1914 It is also noted that the new relationship with

Asia offers great benefits to the neighbouring countries and therefore does not threaten the

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2014

262 R Russell and J G Tokatlian

harmony existing in the sub-region48 While recognizing the historic opportunity offered

to Argentina by the (re)emergence of China and the advancement of several Asian nations

others emphasize the risks especially those coming from China

Within that context it is relevant to mention that the highly optimistic somehow-naive

phase of Chinese ndash Latin American relations is experiencing changes including in

Argentina ndash China relations Most countries in the region and among them Argentina are

slowly moving from a strategy of lsquoreliable engagementrsquo49 to a more mixed strategy based

on a prudent approach that combines strong commercial ties and active damage-control

policies50 Latin American countries are well aware of the importance of key economic

issues and the sensitive security questions that characterize the regionrsquos relations with

China Concerns about de-industrialization via commodity-based export growth (affecting

basically South America) the effect of global lsquocurrency warsrsquo on the region (affecting all

of Latin America) and the impact of a decisive push for rural production within China

(affecting mainly Mexico and Central America) are extremely critical issues from North to

South America

On a broader outlook the fact that the global system is witnessing a period of

uncertainty is generating a new examination of Chinarsquos lsquowin-winrsquo diplomacy51 This is a

time of difficulties that places limits on Beijingrsquos global and regional strategies Not

surprisingly Argentina as well as other countries in Latin America is rethinking its ties

with China under a more nuanced viewpoint The advantages and dividends of more

commercial and financial links with China are superseded by new productive challenges

(for example excessive emphasis on commodities for export) at home and sensible

differences abroad (for example in the case of human rights) Interests and values are now

inextricably intertwined in Argentine ndash Chinese diplomacy In this context the deployment

of a more sophisticated policy vis-a-vis Beijing seems inevitable Necessity more than

willingness is pressing Buenos Aires to design a broader Asian strategy where China will

be a centrepiece but not the only counterpart politically and materially for the country

Looking Ahead

Argentinarsquos foreign policy developed historically from 1880 until the early twenty-first

century around three areas Europe the United States and Latin America especially the

Southern Cone countries Relations with the socialist world particularly with the Soviet

Union for political and commercial reasons were also important in the second half of the

twentieth century but never reached the scale of the other three axes In the decade since

2000 a fourth axis has been added to this traditional pattern with extraordinary strength

and projection the Asia Pacific region dominated by China

Relations with Europe remain important since there are shared interests and values and

a long history of mutual interaction In addition Argentina continues to need European

investments and technology transfers and the EU is still an important trading partner (See

Table 3) But Europe like Japan and the United States is a market in which exports have

shown in the last decade ceilings that are difficult to overcome The most dynamic and

consolidated markets for Argentina are in Latin America and Asia There are also other

developing markets that are growing at a faster pace than the rest of the world and offer

new opportunities for Argentine exports (Australia Canada Russia South Africa and

Turkey) In the next years Europe will focus its attention on domestic issues and other

areas of the world It is unlikely that any significant progress in the relations with

Argentina and Mercosur could be made in the short run A longer-term view suggests that

Dow

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ber

2014

Journal of Iberian and Latin American Research 263

Europe will increasingly lose its relative importance for Argentina and that its historically

privileged position in the countryrsquos foreign relations will be a thing of the past

Argentinarsquos relations with the United States have never been easy Joseph Tulchin

summarizes its nature in the title of his well-known book Argentina and the United States A Conflicted Relationship52 The strategy of lsquocouplingrsquo implemented during the Menem

years was a pragmatic adaptation to the world of the immediate post-Cold War and was

buried as a strategic option for Argentina with the 2001 crisis In the decade of 2000 the

Kirchners went back to the traditional historical pattern that we have called lsquolimited

oppositionrsquo53 This pattern which combines collaboration and disagreement deference

and resistance will continue to guide Argentinarsquos foreign policy toward Washington but

in a framework in which Buenos Airesrsquos concerns about restraining the United States

preponderance and power will tend to decrease Present conditions offer a great lsquoobjectiversquo

opportunity for the development of new areas of selective collaboration between the two

countries at the bilateral and regional levels A new era of relations with the United States

seems to be beginning for the Southern Cone one that is less unequal and perhaps more

cooperative The key challenge for Argentina is coping with a new reality of diminishing

influence of Washington in the sub-region Most of the time power erosion produces two

alternative behaviours adaptation or denial At least for the time being the relative decline

of US hegemony in South America is showing signs of a lsquosoft landingrsquo If this scenario

prevails then Argentina may manage its bilateral relation with the United States in a more

constructive way

In the case of Brazil it seems that we are entering a second long cycle of convergent

views about the place of this country in Argentinarsquos foreign policy54 This cycle may be

compared and opposed to another long period of convergent visions that characterized the

dominant form in which the neighbour country was perceived by the Argentine elites

during most of the twentieth century Today Brazil is defined as a strategic partner while

in the past until the return of both countries to democracy it was seen as a rival As we

have already mentioned the main challenge for Argentina is how to build this strategic

partnership within a framework of growing asymmetry

The link with Argentina although very important does not have today the same value

for Brazil as in the second half of the eighties By contrast the relationship with Brazil is

increasingly relevant for Argentinarsquos foreign relations and one that presents a significant

challenge In the past the relative symmetry between both countries was a constant source

of suspicion and conflict In the future the condition of asymmetric interdependence as a

structural feature of the relationship will not allow for competition but also is no

guarantee of friendship or cooperation Rather it can become a new source of suspicion

distrust and differences Argentina and Brazil will have to learn to live together in this new

reality and develop a broader framework of mutual understanding to manage the major

density of bilateral links and the global issues of common interests The greatest effort

must come from Argentina because it is the country that has a higher interest in the

relationship and more to gain

Finally the emergence of Asia is offering Argentina a unique opportunity for a

dynamic and successful international integration Its most recent economic dynamism is a

direct result of the increased demand from China and other Asian countries for food and

raw materials However Argentinarsquos exports to Asia are highly concentrated in the

soybean complex and to a much smaller extent in a small group of primary and natural

resource intensive products According to the latest ECLAC report five major products

accounted for 92 of total exports from Argentina to China during the years 2007 ndash 2009

(soybean 531 soybean oil 265 crude oil 747 other cattle 248 and meat and

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ber

2014

264 R Russell and J G Tokatlian

poultry offal 233)55 Moreover the trade surplus with China has tended to evaporate

after several years of significant positive balances

This situation raises many questions about the Argentine specialization pattern ndash

beyond issues related to trade with China ndash and the need to reduce an excessive

dependence on the export of commodities Nevertheless as the benefits of trade with

China have been so high and have also enabled Argentina to successfully face and resist

the financial crises in the centres the propensity to do nothing is great As Eric Farnsworth

recently observed lsquoWhen nations are able to sell as much as they can produce of any

particular product the thinking is generally to continue doing so and reap the rewards

When economies are growing there is little political imperative or incentive for reformrsquo56

In consequence a relevant question surrounding this type of relationship is how to avoid

the temptation to inertia The tendency towards passive repetition is appealing The China

lsquochallengersquo in the early twenty-first century for Argentina is how to think and act

differently from what had been the case of Argentine ndash British relations at the beginning of

the twentieth century The framing of a different link with Beijing as well as the positive

handling of an increasingly complex multifaceted multilevel relationship with Brazil

seem to be the major challenges ahead for Argentinarsquos foreign relations

Notes 1 Roberto Russell and Juan G Tokatlian El lugar de Brasil en la polıtica exterior argentina

Buenos Aires Fondo de Cultura Econo mica 2003 pp 45 ndash 59 2 We use the concept lsquosystemic changesrsquo in the same sense as Robert Gilpin See his book War

and Change in World Politics Cambridge Cambridge University Press 1981 pp 42ndash 43 3 For an interesting analysis of these debates see Jose Paradiso Debates y trayectoria de la

polıtica exterior argentina Buenos Aires Grupo Editor Latinoamericano 1993 4 On the concept lsquoasymmetryrsquo and its implications for bilateral relations see Brantley Womack

lsquoAsymmetry and Systemic Misperception China Vietnam and Cambodia during the 1970rsquosrsquo Journal of Strategic Studies 262 June 2003 pp 92ndash 119

5 On structural and relational power see Susan Strange States and Markets An Introduction to International Political Economy London Pinter 1988 pp 25ndash9

6 David C Kang lsquoThe theoretical roots of hierarchy in international relationsrsquo Australian Journal of International Affairs 583 September 2004 p 339

7 Roberto Russell and Juan G Tokatlian lsquoBeyond Orthodoxy Asserting Latin Americarsquos New Strategic Options Toward the United Statesrsquo Latin America Politics and Society 533 Winter 2011 pp 129 ndash 134

8 Eric Hobsbawm lsquoDespues del siglo XX un mundo en transicionrsquo in Ricardo Lagos (ed) America Latina iquestintegracion o fragmentacion Buenos Aires Edhasa 2008 pp 29ndash 47

9 Remarks by the President of the Argentine Republic Nestor Kirchner at the inauguration of the IV Summit of the Americas Mar del Plata httpwwwsummit-ameicasorgDocuments 20del20presidente20de20RepC3BAblica20Argentinapdf

10 La Nacion (Buenos Aires) lsquoCristina Kirchner critico a Obama con duros terminosrsquo 26 February 2010 Available at httpwwwlanacioncomar1237368-cristina-kirchner-criticoshya-obama-con-duros-terminos accessed 17 November 2011

11 For more in depth analysis of the bilateral relations see Russell and Tokatlian El lugar de Brasil pp 45ndash59 and Roberto Russell and Juan G Tokatlian lsquoPercepcoes argentinas sobre o Brasil ambivalencias e expectativasrsquo Polıtica Externa 202 September 2011 pp 43ndash 56

12 Monica Hirst lsquoLa polıtica sudamericana de Brasil entre el peso de las asimetrıas y la incidencia de nuevas coyunturasrsquo in F Calderon (ed) Escenarios polıticos en America Latina Conceptos metodos y Observatorio Regional Cuadernos de Gobernabilidad Democratica 2 Buenos Aires PNUD Siglo XXI 2008 p 257

13 We use the concept of friendship following Alexander Wendt Social Theory of International Politics Cambridge Cambridge UP 1999 pp 297ndash 308

14 La Nacion Economıa y Negocios Buenos Aires lsquoBrasil en la vida cotidiana argentinarsquo 22 May 2011 p 1

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ber

2014

Journal of Iberian and Latin American Research 265

15 On China ndash Latin America relations at the beginning of the XXI Century see Juan G Tokatlian lsquoA view from Latin Americarsquo in R Roett and G Paz (eds) Chinarsquos Expansion into the Western Hemisphere Implications for Latin America and the United States Washington DC Brookings Institution Press 2008

16 According toMark P Sullivan a specialist on Latin American affairs at theUS Congressional Research Service lsquoThe balance of opinion toward China and the United States in Latin America tend to be roughly comparable according to a (2007) Pew study Two exceptions are Argentina where China is viewed much more favorably than the United States and in Mexico where the United States is viewed much more favorably than Chinarsquo See Thomas Lum (ed) lsquoComparing Global Influence China and US Diplomacy Foreign Aid Trade and Investment in the Developing Worldrsquo in CRS Report to Congress August 15 2008

17 Kevin Gallagher lsquoLatin Americarsquos China challengersquo 2011 Policy Innovations httpwwwase tuftsedugdaePubsrpGallagher_PolicyInnovationsJan11pdf accessed 18 November 2011

18 Pablo Gerchunoff 2010 lsquoCausas y azares en mas de un siglo de historia econo mica argentinarsquo in R Russell (ed) Argentina 1910ndash2010 Balance de un siglo Buenos Aires Taurus p 152

19 See the complete quote in Sergio Cesarin lsquoChina y Argentina Enfoques y recomendaciones para potenciar la relacion bilateralrsquo Serie Aportes 2010 httplibraryfesdepdf-filesbueros argentinien07560pdf accessed 28 November 2011

20 Based on INDEC 2011 and Comercio Exterior Argentino 2010 httpwwwindecgovar accessed 13 November 2011

21 Camara de Exportadores de la Republica Argentina En Contcto China No 43 November 2011 p 16

22 In October 2009 President Cristina Fernandez de Kirchner visited India It was her first trip to an Asian country after her inauguration in December 2007 and it was the first visit of an Argentine president to India since 1994

23 It is important to mention the cases of Indonesia and Vietnam for two reasons the growth of trade in the last decade and the fact Argentine exports to these two countries are mainly nonshytraditional commodities For example exports to Indonesia jumped fromUS$43million in 2001 to US$852 million in 2010 while exports to Vietnam grew from US$60 million in 2001 to US $654 million in 2010 Cların iEco Buenos Aires lsquoArgentina en mas puertosrsquo 28 August 2011

24 La Nacion Economıa y Negocios Buenos Aires lsquoLa soja argentina ahora apunta a la Indiarsquo 15 September 2011 p 3

25 China Daily lsquoArgentina China sign tentative swap dealrsquo 31 March 2009 httpwww chinadailycomcnchina2009-0331content_7635007htm accessed 11 November 2011

26 Argenpress (Buenos Aires) lsquoInversiones chinas en la Argentina Claves del nuevo escenario energeticorsquo 14 June 2011 httpwwwargenpressinfo201106inversiones-chinas-enshyargentina-claveshtml accessed 19 November 2011

27 See text of the agreement at httpwwwgrrorgarrionegro-chinaacuerdo-saiz-chinapdf accessed 26 Nov 2011 and El Cronista Buenos Aires lsquoChina invierte 1500 millones en Rıo Negro para asegurarse alimentosrsquo 9 June 2011 httpwwwcronistacomnegocios China-invierte-us-1500-millones-en-Rio-Negro-para-asegurarse-alimentos-20110609-0033 html accessed 19 November 2011

28 On other actual and potential Chinese investments in Argentine provinces see Camara Argentino China Negocios con China 2011 httpwwwargenchinaorgarticulos_2010 NegociosConChinapdf accessed 14 November 2011 and FUNDAMIN lsquoChina invierte en las 23 provincias argentinasrsquo httpfundamincomaresinfo36-exportaciones-e-importaciones 299-china-invierte-en-las-23-provincias-argentinashtml accessed 19 November 2011

29 httpwwwnoalaminaorgmineria-informacion-generalgeneralargentina-china-recreacionshyde-la-vieja-qrelacion-especialq-con-gran-bretana accessed 20 January 2012

30 lsquoLas relaciones entre China y Argentinarsquo httpespanolcricn1161201211281s264119 htm accessed 17 November 2011

31 lsquoRailway rapprochement China invests in Argentinarsquo 2010 httpwwwas-coaorgarticles 2528Railway_Rapprochement_China_Invests_in_Argentina accessed 17 Nov 2011

32 Silvia Simonit lsquoLas empresas chinas en Argentinarsquo Chinese Studies Working Paper Series (Universitat Pompeu Fabra) No 1 2011

33 Loro Horta lsquoIn Uncle Samrsquos Backyard Chinarsquos Military Influence in Latin Americarsquo Military Review September-October 2008 p 48

Dow

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ovem

ber

2014

266 R Russell and J G Tokatlian

34 As are the cases of Brazil Chile Colombia and Venezuela 35 Seguridad y Defensa lsquoEl Ejercito Negocia con China la compra de helico pterosrsquo 10 October

2010 httpwwwseguridadydefensacomarnoticiasejercito-negocia-con-china-la-comprashyde-helicopteros-25059html accessed 10 November 2011

36 httpwwwelmetroonlinecomarindexphpoption frac14com_k2ampviewfrac14 itemampidfrac141067 purishycelli-firmC3B3-convenio-de-defensa-con-chinaampItemid frac14238 accessed 12 September 2012

37 China Military Online lsquoChang Wanquan holds talks with Argentine deputy Defense ministerrsquo 28 November 2011 httpengchinamilcomcnnews-channelschina-militaryshynews2011-1128content_4725893htm accessed 29 November 2011

38 T Wang et lsquoNew SRL station running in San Juan of Argentinarsquo Crustal Dynamics Data Information System nd httpcddisgsfcnasagovlw15docspapersNew20SLR20Station 20Running20in20San20Juan20of20Argentinapdf accessed 9 November 2011

39 Chinese Academy of Sciences lsquoChina Argentina to strengthen cooperation on Antarctic expeditionrsquo 16 August 2010 httpenglishbiccascnNE201008t20100816_57510html accessed 29 November 2011

40 Janie Hulse lsquoChinarsquos Expansion into and US withdrawal from Argentinarsquos telecommunicashytions and space industries and the implications for US national securityrsquo Strategic Studies Institute September 2007 httpwwwstrategicstudiesinstitutearmymilpdffilespub806pdf accessed 7 November 2011

41 Ministry of Science and Technology lsquoChina y la Argentina se reu nen para desarrollar un Centro Binacionalrsquo 2011 httpwwwmincytgovaragendaagenda_detalle phpid_ agendafrac1435 accessed 16 November 2011

42 httpwwwlmneuquencomarnoticias201282avanza-instalacion-de-una-estacion-satel ital-de-china-en-la-provincia_156999 accessed 14 October 2012

43 httpwwwstrategicstudiesinstitutearmymilpubssummarycfmqfrac14 806 accessed 29 November 2011 httpenergyseenewscomnewsargentina-china-sign-nuclear-coop eration-agreement-306141 accessed 3 November 2012

44 For the major reasons that motivated this interest see Lyle Goldstein lsquoChinarsquos Falklands Lessonsrsquo Survival 503 2008 pp 65-66

45 UKNDA Inconvenient Truths Threats Justify Prioritising Defence London UKNDA 2011 p 24

46 La Nacion Buenos Aires lsquoVivir en la Argentina estudiar en Chinarsquo 11 October 2011 http wwwlanacioncomar1413556-vivir-en-la-argentina-estudiar-en-china accessed 9 Novemshyber 2011

47 G M Calderon lsquoInmigracion china en las Americas Comparacion de las experiencias en Canada y Argentinarsquo Revista Argentina de Estudios Canadienses No 2 2008 p 30

48 La Nacion Buenos Aires lsquoChina Una oportunidad histo ricarsquo 26 July 2011 49 Juan Tokatlian lsquoLatin America China and the United States A Hopeful Trianglersquo 2007

Open Democracy httpwwwopendemocracynetdemocracy-protesthopeful_triangle_ 4336jsp accessed 4 November 2011

50 La Nacion Buenos Aires lsquoUna nueva estrategia hacia Chinarsquo 29 August 2011 51 Brantley Womack lsquoBeyond Win-Win Rethinking International Relationships in an Era of

Economic Uncertaintyrsquo Paper presented to the International Conference on the Chinese Models of Development Domestic and Global Aspects Taipei Taiwan September 2011

52 Joseph Tulchin Argentina and the United States A Conflicted Relationship New York Macmillan 1990

53 Russell and Tokatlian lsquoBeyond Orthodoxyrsquo 54 According to the latest report of Latinobaro metro 52 of the Argentines consider Brazil as

the main leader of Latin America while only 2 gives that condition to the United States http wwwlatinobarometroorglatinoLATContenidosjsp accessed 23 November 2011

55 Osvaldo Rosales lsquoLa Republica Popular China y America Latina y el Caribe Hacia una nueva fase en el vınculo econo mico comercialrsquo 2011 ECLAC httpwwweclacorgpubl icacionesxml643666La_Republica_Popular _China_y_America_Latina_y_el_Caribe _ tradepdf accessed 10 November 2011

56 Eric Farnsworth 2011 lsquoThe New Mercantilism Chinarsquos Emerging Role in the Americasrsquo Current History February Available at httpwwwas coaorgarticles2982The_New_shyMercantilism_Chinas_Emerging_Role_in_the_Americas accessed 28 November 2011

Dow

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ded

by [

FU B

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02

37 0

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ovem

ber

2014

Journal of Iberian and Latin American Research 267

Appendix 1

Table 1

Argentinean trade with Brazil in millions of dollars 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Exports 6206 4828 4666 5587 6335 8141 10498 13272 11374 14420 Imports 5230 2517 4700 7567 10187 11749 14523 17687 11822 17658 Trade 975 2310 233 21980 23852 23608 24025 24415 2448 23238 balance

Argentinean trade with the United States in millions of dollars 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Exports 2840 2869 3364 3733 4493 4025 4153 5095 3465 3656 Imports 3737 1789 2238 3389 3998 4247 5264 6894 5106 6125 Trade 2897 1080 1126 344 495 2222 21111 21799 21641 22469 balance

Argentinean trade with China in millions of dollars 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Exports 1123 1092 2483 2628 3193 3476 5170 6355 3668 6117 Imports 1066 330 721 1402 2237 3122 5093 7104 4823 7678 Trade 56 762 1762 1227 956 354 77 2 749 2 1155 2 1561 balance

Source INDEC and UNCTAD

Table 2

FDI stock in Argentina by country of origin in millions of dollars (selected countries) 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

USA 16422 7476 7989 10277 11689 12208 13601 13930 14012 14814 of total 238 231 208 182 187 176 175 172 175 168

Brazil 1953 2108 3280 1773 2488 2810 3659 4969 4319 5367 of total 283 651 856 314 397 406 470 614 539 608

China no data no data no data 13 11 45 120 141 123 5500 of total no data no data no data 002 002 006 015 017 015 623

Total 68935 32403 38323 56554 62639 69292 77899 80941 80144 88249

for the years 2001 2002 and 2003 the data for Brazil includes all FDI from South America excluding ChileFrom 2003 onwards the data is exclusively for BrazilSource INDEC and UNCTAD

Table 3

Argentinean trade with the European Union in millions of dollars 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Exports 4698 5309 6079 6209 6844 8010 9901 13173 10278 11026 Imports 4717 2107 2814 4237 4830 5811 7442 9043 6434 7587 Trade 219 3201 3265 1972 2013 2199 2458 4130 3845 3439 balance

FDI from the European Union in Argentina in millions of dollars 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

FDI 38279 18284 21273 33001 36848 40408 45159 45070 44963 47605 of total 5553 5643 5551 5835 5883 5832 5797 5568 5610 5394 Total 68935 32403 38323 56554 62639 69292 77899 80941 80144 88249

Source INDEC and UNCTAD

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  • Abstract
  • The United States and Brazil Losing and Gaining Centrality
  • Relations with China (and Asia) A Historic and Challenging Opportunity
  • Looking Ahead
  • Notes
  • Appendix
Page 2: Implications of the Global and Regional Changes for Argentina's Foreign Relations

Journal of Iberian and Latin American Research 2013 Vol 19 No 2 251ndash267 httpdxdoiorg101080132602192013853356

Implications of the Global and Regional Changes for Argentinarsquos Foreign Relations

Roberto Russell and Juan Gabriel Tokatliandagger

Universidad Torcuato Di Tella Argentina

The article examines the implications of global power redistribution processes for Argentinarsquos foreign relations focusing on the relative loss of centrality of the United States in the Southern Cone the ongoing consolidation of a South American system with Brazil as the main power and the re-emergence of China and its growing interest in South America The period studied extends from the turn of the century until 2012 Argentina responded to these changes in a complex and distinct manner A strategy of lsquocouplingrsquo with the United States was replaced with that of lsquolimited oppositionrsquo Towards Brazil Argentina has pursued a strategy of accommodation seeking to maximize benefits while retaining as much autonomy as possible Finally with China Argentina has practiced a strategy of lsquoreliable engagementrsquo which has provided clear dividends but appears to be reaching exhaustion We conclude by putting Argentine relations with these three countries into broader perspective

Keywords Argentina foreign policy Brazil USA China South America coupling limited opposition

Latin America has always been a peripheral region in the world system This condition has

made the area both vulnerable and sensitive to international circumstances and global

changes Therefore external variables have been decisive in the way that Latin American

countries have defined and oriented their insertion into the world throughout their entire

life as independent nations Argentina for example could extract extraordinary benefits

from the complementary links it established with Great Britain over the half-century from

1880 to 1930 When global conditions changed Argentina was forced to develop a new

international strategy and spent many years muddling through by trying to respond and

adapt to a changing and less favourable international context

During the nineties under President Carlos Saul Menem Argentina put into practice a

foreign policy model which we have called lsquopragmatic acquiescencersquo as a response to the

global change that resulted from the Western victory in the Cold War and the advancement

and extension of globalization1 As no other country in the region Argentina decided to

lsquojoin the Northrsquo assuming that the onset of a new era in international and inter-American

relations would be dominated by US hegemony resulting in the expansion of liberal

democracy market reforms and free trade agreements

These examples help us understand the implications of systemic changes in the

international insertion of countries like Argentina2 Each of these changes (1914 1945 and

1989) determined the end of a cycle of foreign policy and unleashed strong internal

debates about the degree of openness of the economy to foreign trade the development of

the domestic market industrialization strategies and the external alliances that should be

Email russellrobertogmailcom daggerEmail jtokatlianutdtedu

q 2013 Association of Iberian and Latin American Studies of Australasia (AILASA)

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252 R Russell and J G Tokatlian

favoured3 In each cycle the nature and strategic meaning of relations between Argentina

and the United States and the neighbouring countries of South America were the main

topic of discussion At present and in contrast to the Cold War years and the nineties

relations with both counterparts are developing in a context marked by a novel process that

has two visible faces the erosion of the United States hegemony in South America and the

progressive consolidation of a specific South American subsystem mainly in the Southern

Cone characterized by the emergence of Brazil as a sub-regional power In this scheme

the previous dominant power the United States is no longer central to Argentina while the

emerging power Brazil plays an increasingly important role for the countryrsquos

international relations In both cases asymmetry defines bilateral relations4 The greater

asymmetry of power with the United States weighs less in the relationship due to

Washingtonrsquos declining interest attention and influence in Argentina Indeed the most

powerful actor has lost a great part of its structural power to shape the structure of the

relationship As a consequence its relational power has also weakened that is its capacity

to make Argentina follow its desires and interests has waned significantly5 The minor

asymmetry with Brazil has become a structural feature of bilateral relations and exercises

on Argentina a different effect than the classic asymmetry with the United States for two

main reasons it does not have the magnitude of the former and it occurs in a geographical

area ndash South America ndash that has unique characteristics regarding interstate cooperation and

competence The sub-regionhas someof the features that define a subsystemofhierarchy a) a

main power that is expected to help order the system and to use its power judiciously and b) a

set of shared expectations about state behaviour based on updated information about state

preferences and intentions shared experiences as well as a deep history that reduces

the security dilemma6 At the same time it exhibits elements which distinguish it from

the hierarchic model These are mainly the absence of a central dominant nation and a set

of shared expectations of rights and responsibilities for both the major and the secondary

powers

The sub-region also has a long and distinctive history of interstate peace and

pacific resolution of conflicts that has been fundamental for mitigating the security

dilemma The countries that comprise it are showing remarkable levels of cooperation

Moreover the main power (Brazil) has good relations with all its neighbours and

there are no foreseeable state threats coming from them Within this context and

under this particular form of asymmetry Argentina and Brazil have found a way not

always easily to accommodate each other At the same time and as in other moments

of redistribution of global wealth and power relations with new regions or countries

also occupy an important place in Argentinarsquos foreign policy agenda After World

War II and throughout the Cold War the Soviet Union and the socialist bloc were

important partners They offered the country technology and key markets for

Argentine exports that faced increasing access restrictions with traditional clients

particularly in Europe Today the focus is Asia especially China as a new and

essential counterpart for Argentina For its part the European Union continues to lose

ground as a key partner a process that has been intensified in recent years by the

EUrsquos relative loss of power international prestige and influence

The question that guides this paper is the following What are the implications of three

particular and key aspects of the overall process of redistribution of power and diffusion of

wealth for Argentinarsquos foreign relations We refer to the relative loss of centrality of the

United States in the Southern Cone the ongoing consolidation of a South American

system with Brazil as the main power and the re-emergence of China and its growing

interest in South America The period under study extends from the beginning of the

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Journal of Iberian and Latin American Research 253

century to the present Argentina has responded to each of these developments in a distinct

manner With the United States it has abandoned the strategy of lsquocouplingrsquo and has

implemented a strategy of lsquolimited oppositionrsquo 7 Towards Brazil Argentina has pursued a

strategy of accommodation seeking to gain benefits but also to retain as much autonomy as

possible Finally vis-a-vis China Argentina has practiced a strategy of lsquoreliable engagementrsquo

that has provided clear benefits but which also seems to be exhausting

Relations with the United States Brazil and China are analysed respectively in the two

following sections The focus of our work is placed on the implications of global and

regional changes in the foreign relations of Argentina It is important to note that these

changes do not fall into Gilpinrsquos category of lsquosystemic changesrsquo The changes to which we

refer here belong to a long duration historical cycle that is still in progress and which is

marked by the redistribution of power and wealth from West to East and from North to

South in the context of globalization8 The resultant changes offer unprecedented

opportunities and challenges to most Latin American countries and demand to a large

extent a rethinking of foreign policy its priorities and exercise The paper concludes with

a section in which we try to put into perspective Argentinarsquos relations with the three above

mentioned countries

The United States and Brazil Losing and Gaining Centrality

Argentina-United States relations have experienced significant changes since the

beginning of the twenty-first century The events of 911 in the United States relegated

Argentina to an even less important position from that it had occupied in the George

W Bush administrationrsquos already reduced Latin American agenda Moreover

Washingtonrsquos decision not to support Argentina when the country defaulted on its debt

in late 2001 was read in Buenos Aires and other Latin American capitals as a clear sign

that lsquocouplingrsquo with the United States goes unrewarded and that the time of the

Washington Consensus was coming to an end Most of the Peronists back in government

after the financial crisis found fresh arguments to criticize Washingtonrsquos coldness as well

as the recipes of the IMF and the neoliberal policies pursued by the country in the nineties

From this moment onwards bilateral relations were gradually dominated by two main

trends the loss of US centrality in the foreign policy of Argentina and the growing

indifference of Washington vis-a-vis Buenos Aires

During the first months that followed the crisis Argentina opted for a lsquoselective

rapprochementrsquo with the Unites States rather than merely band wagoning At that time

Washingtonrsquos role was considered central for overcoming the crisis because of its

influence in the multilateral lending institutions Emboldened by the first signs of

economic recovery Eduardo Duhaldersquos transition government (2002 ndash 2003) began to

voice its opposition to some policies of Washington at the end of his short administration

for example to the US military intervention in Iraq The rapid and even startling recovery

from the crisis and the high growth of Argentinarsquos economy in subsequent years

strengthened the idea in Buenos Aires that the country could grow and develop without

Washington and certainly against its economic prescriptions This notion was reinforced

after the March 2005 agreement with private creditors of the debt in default (76 of the

bondholders) and the cancelation in January 2006 of the US$98 billion debt with the IMF

in a single payment using reserves of the Central Bank Thus over a period of around three

years the United States ceased to be seen as an lsquoindispensable nationrsquo for Argentina

The idea that Argentina could do for the most part without strong ties to Washington

had clear ideological components that came from the inner circle of the Nestor Kirchnerrsquos

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254 R Russell and J G Tokatlian

administration (2003 ndash 2007) However it found its greatest support in the material

conditions offered by a global and regional scenario that opened new and extraordinary

opportunities to the country China became a key trading partner and Brazil behaved as the

closest country to Argentina during and in the years following the crisis Meanwhile the

United States did not devote much time to Argentina let alone the wider South America

This fact was much more than the mere repetition of the United States tendency to put

Latin America in a secondary position in its foreign policy concerns It has to be situated in

the context of the long-term process of U S hegemonic decline in South America

especially in the Southern Cone countries

More specifically the low strategic relevance of Argentina for the United States helps

explain the growing indifference of Washington towards the country This fact is not new

but has intensified during this century Argentina does not have a prominent place in any of

the priority issues on the United Statesrsquo Latin American agenda trade migration drugs

terrorism and public safety and energy A second factor that also explains Washingtonrsquos

estrangement from Buenos Aires is a sequence of bilateral conflictive episodes of high-

voltage in which Argentina played or was seen to play the role of the actor less open to

dialogue and more prone to overacting Vocal criticism on the Argentine side first to the

IMF and later to Washingtonrsquos policies past and present became louder as Argentinarsquos

economy recovered The climax came at the Fourth Summit of the Americas held in Mar

del Plata on November 4 and 5 2005 where the then president of Argentina Nestor

Kirchner firmly opposed lsquoneoliberalismrsquo and the creation of a hemispheric free trade area

(FTAA) and accused the United States of having an lsquoanachronistic viewrsquo of the problems

afflicting developing countries Moreover he called on Bush to have a more responsible

leadership in Latin America by ending his support for policies that had lsquonot only led to

misery and poverty but also the fall of democratically elected governmentsrsquo9 Mar del Plata

marked a turn for the worse in bilateral relations and Washington was left with a bitter taste

that would linger until the end of George W Bushrsquos presidency Moreover while the so

called lsquoArgentine modelrsquo heterodox and lsquoneo-developmentalistrsquo in its economic

orientation did not fit into the category of lsquoLatin American radical populismsrsquo it was

viewed by US officials with suspicion and disgust Although Nestor Kirchner never

subscribed to the tenets of the lsquosocialism of the twenty-first centuryrsquo Washington watched

with dissatisfaction the close links established betweenArgentina and Venezuelarsquos Chavez

After the inauguration of Cristina Fernandez de Kirchner to the presidency of

Argentina in December 2007 new conflicts contributed to deepen lsquomutual detachmentrsquo

Barack Obamarsquos arrival in office in January 2008 was considered by Buenos Aires as an

opportunity to open a new dialogue Moreover the financial crisis in the United States

merely reinforced government beliefs and policies on the role of the state in the economy

and on the need to reform the multilateral lending agencies However with its first

domestic and foreign policies the Obama Administration soon showed that the ideological

affinities world views and purposes were less similar to what at first could have been

imagined at the Casa Rosada President Fernandez de Kirchner rapidly moved from initial

lsquoadmirationrsquo to conclude that President Obama lsquohad not fulfilled the expectationsrsquo and that

his Administration lsquoignores the needs of the Southern Conersquo10

Over the years the distancing on global and regional issues became apparent the threat

and the use of force in the Middle East Central Asia and Northern Africa the conception

and practice of the lsquoResponsibility to Protectrsquo the statehood condition of Palestine the level

and scope of protectionism the promotion and enforcement of stronger financial regulations

worldwide the approach vis-a-vis specific countries such as Iran the half-century old

Cuban blockade the debate and reform over crucial aspects of the Inter-American system

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Journal of Iberian and Latin American Research 255

such as the Inter-American Defence Board and the Inter-American Treaty of Reciprocal

assistance the differences in views and attitudes vis-a-vis a sort of lsquoneo-coupismrsquo

(neogolpismo) in the region such as in Venezuela (2002) Honduras (2009) Ecuador (2010) and Paraguay (2012) and the broadening and militarization of the lsquowar on drugsrsquo However

a simultaneous convergence on important world and continental topics has been evident

acting in favour of nuclear non-proliferation avoiding the presence of transnational

terrorism in the area (for example in the Tri-border zone of Argentina Brazil and

Paraguay) supporting the human rights component of the Inter-American system and

participating in humanitarian missions such as the one in Haiti

In brief by the end of the first year of the second mandate of President Fernandez de

Kirchner and after the re-election of President Obama for a second term the bilateral

relationship remained characterized by little presidential dialogue low shared-

expectations outspoken differences and specific cooperation only on issues of common

interest Key coincidences and several major differences have not been institutionalized in

a general framework by which the mixture of consensus and dissent could be managed On

many occasions first and second-level government officials in Washington and Buenos

Aires overreacted to an incident or underplayed an accord In most cases the perception at

the highest level of each government was one of misunderstanding tiredness and

discomfort

Within this context the fact that Argentina will occupy a non-permanent seat on the

UN Security Council in 2013 ndash 2014 where critical issues will be on the agenda (some of

significance for Buenos Aires including the Malvinas-Falkland question as well as the

lsquovulture fundsrsquo suing Argentina in US courts regarding the 2001 debt default) Requiring

Washington to play a positive role may generate a situation that pushes both countries to

at least devise an improved consultative mechanism in order to handle their relationship

with more maturity and realism

Relations between Argentina and Brazil have been marked by the increase in

asymmetries between the two countries in terms of capabilities as well as in international

projection Since the crisis of 2001 Argentina has undergone a gradual process of

economic and self-esteem recovery whereas Brazil has consolidated its position as an

emerging power both regionally and globally These developments together with the loss

of US centrality in South America and Mexicorsquos growing links and interdependence with

North America have dramatically altered the geopolitical landscape in Latin America

particularly in South America

Three distinct phases can be highlighted in the Argentine-Brazilian relationship

since the beginning of the twenty-first century11 The first extends from the crisis of

2001 through 2003 and is characterized by the growing importance given to Brazil by

the elites and public opinion in Argentina While other governments were abandoning

Argentina the Fernando Henrique Cardoso Administration expressed solidarity with

the government led by Eduardo Duhalde during the time of crisis arguing that the

International Monetary Fund could not be insensitive to the serious situation which

afflicted Argentina and said that Brazil continued to trust in its main Mercosur

trading partner Later with Lula already in the Planalto the idea of Brazil as

lsquoalternative development modelrsquo to the one implemented in the 1990s and as the

lsquomain cardrsquo of Argentinarsquos international insertion became dominant in Buenos Aires

Nestor Kirchner took office in May 2003 stating Brazilrsquos importance for Argentina

and emphasized the need to give more weight and density to a common strategic

project However this positive vision of the bilateral relationship was expressed at the

beginning of a phase in which Argentina was leaving behind the crisis With gradual

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256 R Russell and J G Tokatlian

recovery came the revival in Argentina of an ambiguity vis-a-vis Brazil Although

Brazil was seen as a key player and partner it also raised suspicions and doubts

throughout the whole Argentine political spectrum Its status as an emerging power

produced concerns For the Right in Argentina the Lula presidency gave reasons to

refloat the perception of Brazil as an lsquoincorrigiblersquo country The different assessments of

the strategic condition of South America vis-a-vis Latin America also reappeared and with it

fears of a possible Brazilian hegemony in South America The government of Fernando de la

Rua (1999ndash2001) had had a preventive and defensive attitude about the political idea of South

America proposed by Brazil ndash a political and economic geographic area with its own

peculiarities and different from the lsquoLatin America of the Northrsquo The government of Nestor

Kirchner also adopted a reluctant position An eloquent example of this attitudewas President

Kirchnerrsquos decision not to attend the gestation of the South American Community of Nations

meeting (prior to its transformation into the Union of SouthAmericanNations) in 2004 on the

grounds that it was an instrument created by Brazil to project and ensure its own power in

the region

References to Brazil arose in the context of a stagnating Mercosur Repeated promises

to give the bloc a new birth ndash the so called lsquorelanzamientorsquo ndash could not hide that in terms

of its economic significance Mercosur exhibited clear signs of exhaustion Moreover

similar views in both capitals about the lsquodevelopment modelrsquo did not help to give more

oxygen to the integration process The convergence between Kirchner and Lula on the

need to restore the lsquoindustrialistrsquo vision of integration as opposed to the lsquocommercialrsquo

approach of the nineties gave the impression that the two countries were ready to give its

ties a new strategic perspective However the bilateral agenda of lsquoproductiversquo integration

and Brasiliarsquos acceptance of the importance of the lsquore-industrializationrsquo of Argentina were

interpreted in Buenos Aires as a right to establish protectionist measures for Brazilian

exports that threatened the national industry and even more to ignore certain rules This

propensity for defensive policies not only emphasized the lsquofatiguersquo of Mercosur but also

contributed to the low willingness on the part of Brasilia to accept limits to the

autonomous management of its foreign policy Integration never ceased to be a goal for

Brazil but with time acquired a minor role in the priorities of its foreign policy Its

systematic rejection of a surrender of elements of sovereignty and autonomy to the

Mercosur was one of the determinants of the institutional weakness of the bloc Moreover

as Monica Hirst has put it lsquothe importance of the South American economies as a space for

a larger expansion of the Brazilian companies and the statersquos presence as an investor

(Petrobras) and financier (BNDES) [Brazilian Development Bank] became more

important for Brazilian material and strategic interests that the regional integration

process especially the Mercosurrsquo12 In short ambiguous perceptions coexisted in

Argentina with fluctuating bilateral relations The setting was propitious for the

reappearance of anti-Brazil perceptions in Argentina The pro-Brazilian episodic euphoria

of the years of Duhalde (Brazil as a lsquogreat strategic allyrsquo) turned into doubt and criticism in

the second phase which goes from the beginning of 2004 to the end of 2006 Explicitly

and implicitly by both the Right and the Left an ambivalent feeling towards Brazil

unfolded albeit without the pugnacity of the past but nevertheless highlighting the

difficulties of embedding a culture of friendship between the two countries13

As in other debates in Argentina these visions were remnants of perceptions forged in

the seventies and nineties Kirchnerrsquos own ambiguities style and measures in government

did not help to build a more positive image of the role of Brazil for Argentina Several

groups located in the Ministry of Foreign Affairs the business world think-tanks and the

media encouraged the counterbalancing of Brazil in lsquoSouth Americarsquo by means of a

Dow

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2014

Journal of Iberian and Latin American Research 257

lsquoLatin-Americanrsquo policy in which the role of Mexico was presented as crucial On the

other hand the vision of Chile as a partner for a more balanced South America and as an

economic model also regained strength in a wide spectrum of the Argentine elites covering

the Right to the centre-Left Chilersquos image was contrasted with that of Brazil The first was

seen essentially as lsquopredictablersquo and lsquoreasonablersquo while the second after the triumph of

Lularsquos Workers Party tended to be presented on the opposite side For some closer

relations with Chile would serve to offset the influence of Brazil in the Southern Cone ndash a

Santiago ndash Buenos Aires axis to limit the Brazilian aspiration to lead the area ndash while

others perceived the lsquoChilean wayrsquo as the best manner for taking a safe distance from

Mercosur which was perceived as an obstacle to establishing a flexible dense and fruitful

relationship with the rest of the world Finally the Left identified the relationship with

Venezuela as a balancing factor for restraining the power of Brazil

The third phase of Argentine ndash Brazilian relations started at the end of 2006 and

extends to the present An interesting twist can be observed in the direction of a more

positive perception of Brazil that clearly puts it in a central place for Argentina Two main

factors explain this change The first and most important is the growing international

relevance and regional weight of Brazil This process has led to the formation of a

widespread perception in Argentina that defines Brazil as lsquoinevitablersquo with a predominant

negative and generally pessimistic bias or as a country that is lsquoindispensablersquo in this case

emphasizing the possibility of building a common future and a strong cooperative

relationship The idea of Brazil as a necessary country is widely accepted but has

variously been accepted with resignation disgust and joy alternatively viewed as an

opportunity or severe challenge The lsquosuccessrsquo of Brazil is often contrasted with the

lsquofailuresrsquo of Argentina and generates different feelings such as pain envy nostalgia and

desire for emulation In any case the growth and rise of Brazil has converted it into a

model for almost everyone The second factor is the growing density of bilateral relations

As an example it is interesting to note that Brazil is already the fourth largest foreign

investor in Argentina after the United States Spain and China In 2010 24 of total

exports (42 industrial) and 82 of the cars manufactured in Argentina were directed to

the Brazilian market and 863492 Brazilian tourists visited the country14 At the same

time the expansion of Brazilian companies in Argentinarsquos productive activity and trade

has been impressive in the last decade

The main issue for the future then is how to live and interact with the lsquoinevitablersquo or

lsquoindispensablersquo country This convergence of perceptions regarding the centrality of Brazil

for Argentina only goes so far There is no agreement on the political economic and

strategic interests that should constitute the relationship with Brazil and consequently

about the best ways to put them into practice The transition from an entrenched culture of

rivalry to an incipient culture of friendship has lasted more than a quarter of a century

providing promising dividends for both nations and offering a good platform from which

to renegotiate the growing bilateral ties The world and the region and the national

situation of the two countries especially concerning the distribution of attributes of

economic power are now very different to the 1980s when the two countries took the first

steps to build a positive bilateral relationship The double condition of the Argentine ndash

Brazilian relationship that is its increasingly close and uneven character suggests that

there will be a complex combination of convergence and divergence between the two

nations Argentina and Brazil never were Pakistan and India in terms of antagonism and

sought in the past to jointly become an equivalent to the Franco ndash German axis for the

integration of South America an aspiration that today is unsustainable Circumstances

have changed and the condition of lsquoasymmetric interdependencersquo is recognized and

Dow

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ovem

ber

2014

258 R Russell and J G Tokatlian

accepted in Argentina although not without the suspicions that characterize the attitudes

of the weaker party in a bilateral relationship In this context the main challenge for

Brasilia and Buenos Aires is to forge a realistic and positive lsquonew dealrsquo that contemplates

with its own specificity the bilateral relationship as well as Mercosur

In the end the above-mentioned three phases show the existence of both a changing

and intricate relationship If the theory of asymmetry is taken into consideration the first

move towards re-negotiating an unbalanced relationship should be initiated to a large

extent by the less powerful party In that sense it is yet unclear what the Argentine elites

(civilian and military economic and intellectual state-based and non-governmental) want

from relations with the continent (including the United States) the Spanish-speaking

region South America and finally Brazil Historically it has been quite difficult for

Argentines to have simultaneous positive relations with Washington and Brasilia In the

last two decades different opinions (sometimes personal more than collective) between

the lsquoLatin-Americanistsrsquo and the lsquoSouth-Americanistsrsquo favouring opposite strategic

options have been vocally expressed Currently several other countries in the area have

been increasing their leverage especially those facing the Pacific This phenomenon does

not go unnoticed by Argentine elites and is another source of domestic debate In this

dynamic and changing regional context Argentina has not been able to clearly establish

the goals and ambitions to guide its foreign policy towards the region and Brazil in

particular The response to this situation should be sought in essence in domestic politics

Relations with China (and Asia) A Historic and Challenging Opportunity

Argentine ndash Chinese links should be placed in the larger context of China ndashLatin America

relations15 From a Latin American perspective Chinarsquos growing presence in the region

has been seen at least in the first decade of the twenty-first century as a promising trend

Chinarsquos ties with Latin America from the 1950s to the 1970s were marginal focused

primarily on cultural diplomacy driven by ideological motives and based on

revolutionary rhetoric This diplomatic strategy relied on the dividends of destabilization

was accompanied by anti-US slogans and was geared toward strengthening pro-Chinese

(and anti-Soviet) political parties and movements Chinarsquos international behaviour during

that period was that of a revisionist actor who sought to change the rules of the game

through aggressive means

In contrast Beijingrsquos approach to the region since the 1990s has involved an active

economic diplomacy characterized by pragmatism conciliation and stability Chinarsquos key

goal and main challenge has been to deepen its relations with the countries of Latin America

without irritating Washington Diplomatically China has proceeded in a judicious fashion

which explains in part why regional forces did not emerge to veto a policy of prudent and

consistent engagement toward China In addition Chinarsquos external diplomatic model has

been seductive to Latin America especially during the two administrations of George

W Bush in the United States multipolarism as opposed to unipolarism multilateralism as

opposed to unilateralism non-interference as opposed to interventionism soft power as

opposed to hard power pragmatism as opposed to ideologisation collaboration as opposed

to domination and persuasion as opposed to coercion All have been attractive notions in

Latin America Chinarsquos contemporary approach coincides with strong Latin American

traditions and aspirations and has become more captivating by virtue of the mishandling

disregard and thoughtlessness of US foreign policy towards the region

Nothing indicates that Latin America is geared towards accepting a paternalistic

externally-induced security dilemma with China and the region does not feel insecure visshy

Dow

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37 0

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ovem

ber

2014

Journal of Iberian and Latin American Research 259

a-vis Beijing despite certain ideologically-driven pressure groups in Washington

Moreover the Sino ndash Latin American ndash US triangular relationship has not engendered

major tensions or unmanageable challenges16 There is also nothing to suggest from a

regional viewpoint that Latin America ndash China ndash United States relations are destined to an

apocalyptic geopolitics approach based on an overblown fear of an alleged Chinese

takeover of the region China is not the Soviet Union post 911 is not a rehearsal of the

Cold War Washington is no longer at the pinnacle of world power and Latin America has

not collapsed after the Western economic and financial crisis began in 2008 There is also

no indication that Chinarsquos intention is to challenge the United States in the Western

Hemisphere In fact the Chinese government has actively sought to convince the United

States and the rest of the world that its intentions are benign thus the self-portrayal of a

peaceful rise

Chinarsquos behaviour in Latin America at the outset of the twenty-first century has been

far from that of a revisionist power On the one hand Beijingrsquos strategy has combined

necessity with opportunity and has been put into practice cautiously and diligently

curtailing the likelihood that the region will develop or adopt a policy aimed at rolling

back Chinarsquos presence On the other hand Latin Americarsquos relationship with Beijing is

more dependent on economic facts than political conceptions As there is no major

ideological concern in most countries about dealing with China the crucial element is the

material effect of Sino ndash Latin American linkages the level of dependency of the region

vis-a-vis China the degree of de-industrialization of the area derived from bilateral trade

and the ecological consequences of Chinese investment in Latin America17

This broader framework is essential to understand the dynamics of Argentinarsquos

relations with China in the larger context of Argentinendash Asian links Over the past two

decades the (re)emergence of China and the ascent of Asia have been a blessing for

Argentina Rising demand and higher prices for commodities have made it possible for

Argentina to elevate and diversify its trade flows with the East Since the 1990s and

despite the discernible differences in economic and foreign policies between Carlos

Menem and the Kirchners Argentina has developed a new pattern of production that has

led notwithstanding the crisis of 2001 to a reorganization of the economic base of the

country As noted by Pablo Gerchunoff lsquoIt is not just about the speed of exports there is

also a significant diversification traditional agriculture new agriculture industry energy

and mining concurred to modify the national economic landscapersquo18 In that context and

according to President Nestor Kirchner it was crucial lsquothrough China to search in Asia the

leverage to re-industrialize Argentinarsquo Economy not politics has been the driving force

to improve and extend Argentine relations with the East19

For the first time in more than seven decades Argentina has met a world that eagerly

requires what it produces The key driver of this demand is located in China but covers a

wide range of countries At present China is Argentinarsquos second largest trading partner

both in terms of the origin of imports and recipient of exports ndash in both dimensions after

Brazil and before the United States (See Table 1) Argentina meanwhile ranks third in the

list of the 15 major suppliers of agricultural products which supplied 90 per cent of

Chinese imports in 2010 United States (244) Brazil (136) and Argentina (73)

Other major suppliers were the European Union (6) Australia (5) and Malaysia (5)

By 2001 Argentine exports to China surpassed the US$1 billion barrier to hit US$1123

billion and imports totalled US$1066 billion Thus there was a small surplus of US$56

million in favour of Argentina By 2010 the commercial exchange was worth US$13795

billion totalling US$6117 billion in Argentine exports and US$7678 billion in Chinese

exports The result was a trade balance of US$1561 billion in Chinarsquos favour20 In the

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260 R Russell and J G Tokatlian

period January ndashSeptember 2011 the surplus in favour of China grew While Argentine

exports amounted to US$4746 billion Chinese exports came to US$7569 billion21

India is Argentinarsquos main Asian trading partner after China22 Other important

countries are Indonesia South Korea Malaysia Vietnam and Thailand23 By 2010 when

China implemented barriers to Argentine soybean oil in retaliation for local action that

prevented the entry of Chinese products into the country Argentina reoriented its soybean

exports to India which bought 14 million tons of soybean oil (corresponding to US$12

billion dollars) In September 2011 Indiarsquos ambassador in Argentina said his country

would increase demand for soybean oil over the next ten years from the current 8 million

to 15 million tons representing a significant additional opportunity for Argentine

producers and exporters24

Indeed ties with Asia are not limited to trade Again the paradigmatic case of this

new relationship is China which in recent years has also emerged as an increasingly

important financial actor During 2009 at a high point of the US-originated financial

crisis China and Argentina agreed to swap US$10 billion worth of their currencies in

order to enable Argentina to avoid using dollars in trade between both countries an

agreement that was the first of this sort between China and a South American country25

Beijing simultaneously accelerated its investment in agriculture mining energy and

banking and has become the third largest investor in the country (See Table 2)26 In

addition there is strong Chinese interest for participation in infrastructure development

projects in sectors such as railways roads ports and telecommunications The largest

food company in China Heilonjiang Beida-Huang signed an October 2010 cooperation

agreement with the province of Rıo Negro27 which provides China with twenty-year

leases on provincial lands (20000 hectares at an early stage that may eventually extend

to up to 320000 hectares)28 In return the Chinese company is committed to

undertaking major irrigation and infrastructure works as part of a ten-year investment of

US$15 billion dollars29 Different actors from Argentina are also opening trade offices

in Chinese cities and several twin cities and sister provinces have signed different 30agreements

In the oil sector the China National Offshore Oil Corporation (CNOOC) acquired 50

per cent of Bridas Corporation and Sinopec holds 100 per cent of Argentine assets in

Occidental In addition China controls 50 per cent of the Cerro Dragon field and will

handle major reserves for 40 years in the province of Santa Cruz To sum up Beijingrsquos

growing interest in Argentina has meant that the country is according to Levi J Jordan

from the Americas Society lsquoreceiving almost half of Chinarsquos investment in South America

over the past two yearsrsquo31 In that context the growth of Chinarsquos state corporations is

impressive32 Agreements have also been made in the field of defence the most prominent

is the signing of the Memorandum of Understanding for Strengthening Exchanges and

Cooperation in Defense of 16 May 2007 whereby both countries have committed to

maintain contacts to discuss global and regional security issues to cooperate on military

equipment and logistics and to establish a Defence Joint Commission It is worth

mentioning that officers from Argentina together with military from Chile and Colombia

frequently (more often than counterparts from Cuba and Venezuela) have attended courses

on grand strategy at Beijingrsquos elite national defence university PLANDU33 Even though

Argentina is not a significant South American buyer of military equipment34 has a very

low annual defence budget and that China is not the major supplier of arms to the region

(as it is the case of the United States Russia and the European Union) it has lately

considered the acquisition of Chinese Z-11 helicopters35 Finally after a July 2012 visit to

China by Argentine Defence Minister Arturo Puricelli both countries agreed that

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2014

Journal of Iberian and Latin American Research 261

Argentina will construct a prototype of that helicopter by 201336 In general the level of

bilateral military dialogue is highly positive37

In key scientific and technological areas there has been an on-going improvement of

relations For example a Satellite Laser Raging (SLR) system designed and made in China

was installed in the Observatory of San Juan University38 Both countries plan to conduct

collaborative activities for Antarctic expedition39 There are many contacts and joint

initiatives in the areas of telecommunications and space40 The two countries are also

interested in creating a Bilateral Centre on Science and Technology for Food41

In addition China will install a satellite station in the province of Neuquen42 while

incrementing its presence in the telecommunications sector and establishing cooperation

ties in the nuclear field43

Argentina and China share important interests in their diplomatic agenda with regards

to the defence of the principle of lsquoterritorial integrityrsquo China consistently supports the

Argentine claim of sovereignty over the MalvinasFalklands while Argentina defends the

policy of lsquoone Chinarsquo which implies the non-recognition of the independence of Taiwan

and Tibet The issue of the MalvinasFalklands Islands has been surfacing for two reasons

On the one hand as Lyle Goldstein has remarked lsquoChinese defence analysts take such

intense interest in the Falkland Warrsquo due to the fact that according to Chinese government

officials and experts there are certain similarities between the Malvinas and Taiwan44 As

Taiwan is a vital issue for Beijing the understanding of the 1982 war in the South Atlantic

is extremely relevant On the other hand the potential closeness of China and Argentina

may provoke in the future a vulnerable situation with regards to the islands that could

affect British defence policy45 In times of a major economic crisis in Europe and with

diminishing possibilities of sustaining high defence budgets retired military officers from

Great Britain overemphasize Londonrsquos potential weakness in the South Atlantic

With respect to issues on the global agenda the two countries agree at the level of the

G-20 on the need for greater participation of emerging nations in international financial

organizations as well as the need to implement measures for the avoidance of financial

speculation that causes volatility in the prices of commodities Both countries have been

supporting peacekeeping operations and they both participate militarily in the UN Mission

in Haiti At the International Atomic Energy Agency Beijing and Buenos Aires have been

active in the promotion of non-proliferation

It is important also to mention a relatively new phenomenon in the relation between

Beijing and Buenos Aires namely Chinese immigration to Argentina There are

approximately 120000 Chinese and Chinese-descendants in Argentina mainly in Buenos

Aires46 Their point of origin is mostly Taiwan and Fujian and to a lesser extent Hong

Kong Even though there are no good estimates or different in-depth studies lsquoChinese

immigration to Argentina is assumed to be largely of illegal naturersquo with lsquoremittances an

important flow of capitalrsquo and Argentina being lsquoan intermediate stoprsquo for approximately

half of the Chinese migrants before seeking entry into the United States (mainly) or the

European Union47

To sum up the capabilities willingness and needs of both sides make the relationship

between Argentina and China (and Asia) complementary The East needs raw materials

(energy food and mining) and Argentina needs investments and infrastructure Of course

a link of this nature presents opportunities but also brings risks It has become fashionable

in Argentina to compare the current situation with the golden years of the lsquospecial

relationshiprsquo with Great Britain (and Europe) that was undoubtedly the engine of the great

Argentine take off between 1880 and 1914 It is also noted that the new relationship with

Asia offers great benefits to the neighbouring countries and therefore does not threaten the

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2014

262 R Russell and J G Tokatlian

harmony existing in the sub-region48 While recognizing the historic opportunity offered

to Argentina by the (re)emergence of China and the advancement of several Asian nations

others emphasize the risks especially those coming from China

Within that context it is relevant to mention that the highly optimistic somehow-naive

phase of Chinese ndash Latin American relations is experiencing changes including in

Argentina ndash China relations Most countries in the region and among them Argentina are

slowly moving from a strategy of lsquoreliable engagementrsquo49 to a more mixed strategy based

on a prudent approach that combines strong commercial ties and active damage-control

policies50 Latin American countries are well aware of the importance of key economic

issues and the sensitive security questions that characterize the regionrsquos relations with

China Concerns about de-industrialization via commodity-based export growth (affecting

basically South America) the effect of global lsquocurrency warsrsquo on the region (affecting all

of Latin America) and the impact of a decisive push for rural production within China

(affecting mainly Mexico and Central America) are extremely critical issues from North to

South America

On a broader outlook the fact that the global system is witnessing a period of

uncertainty is generating a new examination of Chinarsquos lsquowin-winrsquo diplomacy51 This is a

time of difficulties that places limits on Beijingrsquos global and regional strategies Not

surprisingly Argentina as well as other countries in Latin America is rethinking its ties

with China under a more nuanced viewpoint The advantages and dividends of more

commercial and financial links with China are superseded by new productive challenges

(for example excessive emphasis on commodities for export) at home and sensible

differences abroad (for example in the case of human rights) Interests and values are now

inextricably intertwined in Argentine ndash Chinese diplomacy In this context the deployment

of a more sophisticated policy vis-a-vis Beijing seems inevitable Necessity more than

willingness is pressing Buenos Aires to design a broader Asian strategy where China will

be a centrepiece but not the only counterpart politically and materially for the country

Looking Ahead

Argentinarsquos foreign policy developed historically from 1880 until the early twenty-first

century around three areas Europe the United States and Latin America especially the

Southern Cone countries Relations with the socialist world particularly with the Soviet

Union for political and commercial reasons were also important in the second half of the

twentieth century but never reached the scale of the other three axes In the decade since

2000 a fourth axis has been added to this traditional pattern with extraordinary strength

and projection the Asia Pacific region dominated by China

Relations with Europe remain important since there are shared interests and values and

a long history of mutual interaction In addition Argentina continues to need European

investments and technology transfers and the EU is still an important trading partner (See

Table 3) But Europe like Japan and the United States is a market in which exports have

shown in the last decade ceilings that are difficult to overcome The most dynamic and

consolidated markets for Argentina are in Latin America and Asia There are also other

developing markets that are growing at a faster pace than the rest of the world and offer

new opportunities for Argentine exports (Australia Canada Russia South Africa and

Turkey) In the next years Europe will focus its attention on domestic issues and other

areas of the world It is unlikely that any significant progress in the relations with

Argentina and Mercosur could be made in the short run A longer-term view suggests that

Dow

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ber

2014

Journal of Iberian and Latin American Research 263

Europe will increasingly lose its relative importance for Argentina and that its historically

privileged position in the countryrsquos foreign relations will be a thing of the past

Argentinarsquos relations with the United States have never been easy Joseph Tulchin

summarizes its nature in the title of his well-known book Argentina and the United States A Conflicted Relationship52 The strategy of lsquocouplingrsquo implemented during the Menem

years was a pragmatic adaptation to the world of the immediate post-Cold War and was

buried as a strategic option for Argentina with the 2001 crisis In the decade of 2000 the

Kirchners went back to the traditional historical pattern that we have called lsquolimited

oppositionrsquo53 This pattern which combines collaboration and disagreement deference

and resistance will continue to guide Argentinarsquos foreign policy toward Washington but

in a framework in which Buenos Airesrsquos concerns about restraining the United States

preponderance and power will tend to decrease Present conditions offer a great lsquoobjectiversquo

opportunity for the development of new areas of selective collaboration between the two

countries at the bilateral and regional levels A new era of relations with the United States

seems to be beginning for the Southern Cone one that is less unequal and perhaps more

cooperative The key challenge for Argentina is coping with a new reality of diminishing

influence of Washington in the sub-region Most of the time power erosion produces two

alternative behaviours adaptation or denial At least for the time being the relative decline

of US hegemony in South America is showing signs of a lsquosoft landingrsquo If this scenario

prevails then Argentina may manage its bilateral relation with the United States in a more

constructive way

In the case of Brazil it seems that we are entering a second long cycle of convergent

views about the place of this country in Argentinarsquos foreign policy54 This cycle may be

compared and opposed to another long period of convergent visions that characterized the

dominant form in which the neighbour country was perceived by the Argentine elites

during most of the twentieth century Today Brazil is defined as a strategic partner while

in the past until the return of both countries to democracy it was seen as a rival As we

have already mentioned the main challenge for Argentina is how to build this strategic

partnership within a framework of growing asymmetry

The link with Argentina although very important does not have today the same value

for Brazil as in the second half of the eighties By contrast the relationship with Brazil is

increasingly relevant for Argentinarsquos foreign relations and one that presents a significant

challenge In the past the relative symmetry between both countries was a constant source

of suspicion and conflict In the future the condition of asymmetric interdependence as a

structural feature of the relationship will not allow for competition but also is no

guarantee of friendship or cooperation Rather it can become a new source of suspicion

distrust and differences Argentina and Brazil will have to learn to live together in this new

reality and develop a broader framework of mutual understanding to manage the major

density of bilateral links and the global issues of common interests The greatest effort

must come from Argentina because it is the country that has a higher interest in the

relationship and more to gain

Finally the emergence of Asia is offering Argentina a unique opportunity for a

dynamic and successful international integration Its most recent economic dynamism is a

direct result of the increased demand from China and other Asian countries for food and

raw materials However Argentinarsquos exports to Asia are highly concentrated in the

soybean complex and to a much smaller extent in a small group of primary and natural

resource intensive products According to the latest ECLAC report five major products

accounted for 92 of total exports from Argentina to China during the years 2007 ndash 2009

(soybean 531 soybean oil 265 crude oil 747 other cattle 248 and meat and

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ber

2014

264 R Russell and J G Tokatlian

poultry offal 233)55 Moreover the trade surplus with China has tended to evaporate

after several years of significant positive balances

This situation raises many questions about the Argentine specialization pattern ndash

beyond issues related to trade with China ndash and the need to reduce an excessive

dependence on the export of commodities Nevertheless as the benefits of trade with

China have been so high and have also enabled Argentina to successfully face and resist

the financial crises in the centres the propensity to do nothing is great As Eric Farnsworth

recently observed lsquoWhen nations are able to sell as much as they can produce of any

particular product the thinking is generally to continue doing so and reap the rewards

When economies are growing there is little political imperative or incentive for reformrsquo56

In consequence a relevant question surrounding this type of relationship is how to avoid

the temptation to inertia The tendency towards passive repetition is appealing The China

lsquochallengersquo in the early twenty-first century for Argentina is how to think and act

differently from what had been the case of Argentine ndash British relations at the beginning of

the twentieth century The framing of a different link with Beijing as well as the positive

handling of an increasingly complex multifaceted multilevel relationship with Brazil

seem to be the major challenges ahead for Argentinarsquos foreign relations

Notes 1 Roberto Russell and Juan G Tokatlian El lugar de Brasil en la polıtica exterior argentina

Buenos Aires Fondo de Cultura Econo mica 2003 pp 45 ndash 59 2 We use the concept lsquosystemic changesrsquo in the same sense as Robert Gilpin See his book War

and Change in World Politics Cambridge Cambridge University Press 1981 pp 42ndash 43 3 For an interesting analysis of these debates see Jose Paradiso Debates y trayectoria de la

polıtica exterior argentina Buenos Aires Grupo Editor Latinoamericano 1993 4 On the concept lsquoasymmetryrsquo and its implications for bilateral relations see Brantley Womack

lsquoAsymmetry and Systemic Misperception China Vietnam and Cambodia during the 1970rsquosrsquo Journal of Strategic Studies 262 June 2003 pp 92ndash 119

5 On structural and relational power see Susan Strange States and Markets An Introduction to International Political Economy London Pinter 1988 pp 25ndash9

6 David C Kang lsquoThe theoretical roots of hierarchy in international relationsrsquo Australian Journal of International Affairs 583 September 2004 p 339

7 Roberto Russell and Juan G Tokatlian lsquoBeyond Orthodoxy Asserting Latin Americarsquos New Strategic Options Toward the United Statesrsquo Latin America Politics and Society 533 Winter 2011 pp 129 ndash 134

8 Eric Hobsbawm lsquoDespues del siglo XX un mundo en transicionrsquo in Ricardo Lagos (ed) America Latina iquestintegracion o fragmentacion Buenos Aires Edhasa 2008 pp 29ndash 47

9 Remarks by the President of the Argentine Republic Nestor Kirchner at the inauguration of the IV Summit of the Americas Mar del Plata httpwwwsummit-ameicasorgDocuments 20del20presidente20de20RepC3BAblica20Argentinapdf

10 La Nacion (Buenos Aires) lsquoCristina Kirchner critico a Obama con duros terminosrsquo 26 February 2010 Available at httpwwwlanacioncomar1237368-cristina-kirchner-criticoshya-obama-con-duros-terminos accessed 17 November 2011

11 For more in depth analysis of the bilateral relations see Russell and Tokatlian El lugar de Brasil pp 45ndash59 and Roberto Russell and Juan G Tokatlian lsquoPercepcoes argentinas sobre o Brasil ambivalencias e expectativasrsquo Polıtica Externa 202 September 2011 pp 43ndash 56

12 Monica Hirst lsquoLa polıtica sudamericana de Brasil entre el peso de las asimetrıas y la incidencia de nuevas coyunturasrsquo in F Calderon (ed) Escenarios polıticos en America Latina Conceptos metodos y Observatorio Regional Cuadernos de Gobernabilidad Democratica 2 Buenos Aires PNUD Siglo XXI 2008 p 257

13 We use the concept of friendship following Alexander Wendt Social Theory of International Politics Cambridge Cambridge UP 1999 pp 297ndash 308

14 La Nacion Economıa y Negocios Buenos Aires lsquoBrasil en la vida cotidiana argentinarsquo 22 May 2011 p 1

Dow

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ber

2014

Journal of Iberian and Latin American Research 265

15 On China ndash Latin America relations at the beginning of the XXI Century see Juan G Tokatlian lsquoA view from Latin Americarsquo in R Roett and G Paz (eds) Chinarsquos Expansion into the Western Hemisphere Implications for Latin America and the United States Washington DC Brookings Institution Press 2008

16 According toMark P Sullivan a specialist on Latin American affairs at theUS Congressional Research Service lsquoThe balance of opinion toward China and the United States in Latin America tend to be roughly comparable according to a (2007) Pew study Two exceptions are Argentina where China is viewed much more favorably than the United States and in Mexico where the United States is viewed much more favorably than Chinarsquo See Thomas Lum (ed) lsquoComparing Global Influence China and US Diplomacy Foreign Aid Trade and Investment in the Developing Worldrsquo in CRS Report to Congress August 15 2008

17 Kevin Gallagher lsquoLatin Americarsquos China challengersquo 2011 Policy Innovations httpwwwase tuftsedugdaePubsrpGallagher_PolicyInnovationsJan11pdf accessed 18 November 2011

18 Pablo Gerchunoff 2010 lsquoCausas y azares en mas de un siglo de historia econo mica argentinarsquo in R Russell (ed) Argentina 1910ndash2010 Balance de un siglo Buenos Aires Taurus p 152

19 See the complete quote in Sergio Cesarin lsquoChina y Argentina Enfoques y recomendaciones para potenciar la relacion bilateralrsquo Serie Aportes 2010 httplibraryfesdepdf-filesbueros argentinien07560pdf accessed 28 November 2011

20 Based on INDEC 2011 and Comercio Exterior Argentino 2010 httpwwwindecgovar accessed 13 November 2011

21 Camara de Exportadores de la Republica Argentina En Contcto China No 43 November 2011 p 16

22 In October 2009 President Cristina Fernandez de Kirchner visited India It was her first trip to an Asian country after her inauguration in December 2007 and it was the first visit of an Argentine president to India since 1994

23 It is important to mention the cases of Indonesia and Vietnam for two reasons the growth of trade in the last decade and the fact Argentine exports to these two countries are mainly nonshytraditional commodities For example exports to Indonesia jumped fromUS$43million in 2001 to US$852 million in 2010 while exports to Vietnam grew from US$60 million in 2001 to US $654 million in 2010 Cların iEco Buenos Aires lsquoArgentina en mas puertosrsquo 28 August 2011

24 La Nacion Economıa y Negocios Buenos Aires lsquoLa soja argentina ahora apunta a la Indiarsquo 15 September 2011 p 3

25 China Daily lsquoArgentina China sign tentative swap dealrsquo 31 March 2009 httpwww chinadailycomcnchina2009-0331content_7635007htm accessed 11 November 2011

26 Argenpress (Buenos Aires) lsquoInversiones chinas en la Argentina Claves del nuevo escenario energeticorsquo 14 June 2011 httpwwwargenpressinfo201106inversiones-chinas-enshyargentina-claveshtml accessed 19 November 2011

27 See text of the agreement at httpwwwgrrorgarrionegro-chinaacuerdo-saiz-chinapdf accessed 26 Nov 2011 and El Cronista Buenos Aires lsquoChina invierte 1500 millones en Rıo Negro para asegurarse alimentosrsquo 9 June 2011 httpwwwcronistacomnegocios China-invierte-us-1500-millones-en-Rio-Negro-para-asegurarse-alimentos-20110609-0033 html accessed 19 November 2011

28 On other actual and potential Chinese investments in Argentine provinces see Camara Argentino China Negocios con China 2011 httpwwwargenchinaorgarticulos_2010 NegociosConChinapdf accessed 14 November 2011 and FUNDAMIN lsquoChina invierte en las 23 provincias argentinasrsquo httpfundamincomaresinfo36-exportaciones-e-importaciones 299-china-invierte-en-las-23-provincias-argentinashtml accessed 19 November 2011

29 httpwwwnoalaminaorgmineria-informacion-generalgeneralargentina-china-recreacionshyde-la-vieja-qrelacion-especialq-con-gran-bretana accessed 20 January 2012

30 lsquoLas relaciones entre China y Argentinarsquo httpespanolcricn1161201211281s264119 htm accessed 17 November 2011

31 lsquoRailway rapprochement China invests in Argentinarsquo 2010 httpwwwas-coaorgarticles 2528Railway_Rapprochement_China_Invests_in_Argentina accessed 17 Nov 2011

32 Silvia Simonit lsquoLas empresas chinas en Argentinarsquo Chinese Studies Working Paper Series (Universitat Pompeu Fabra) No 1 2011

33 Loro Horta lsquoIn Uncle Samrsquos Backyard Chinarsquos Military Influence in Latin Americarsquo Military Review September-October 2008 p 48

Dow

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ovem

ber

2014

266 R Russell and J G Tokatlian

34 As are the cases of Brazil Chile Colombia and Venezuela 35 Seguridad y Defensa lsquoEl Ejercito Negocia con China la compra de helico pterosrsquo 10 October

2010 httpwwwseguridadydefensacomarnoticiasejercito-negocia-con-china-la-comprashyde-helicopteros-25059html accessed 10 November 2011

36 httpwwwelmetroonlinecomarindexphpoption frac14com_k2ampviewfrac14 itemampidfrac141067 purishycelli-firmC3B3-convenio-de-defensa-con-chinaampItemid frac14238 accessed 12 September 2012

37 China Military Online lsquoChang Wanquan holds talks with Argentine deputy Defense ministerrsquo 28 November 2011 httpengchinamilcomcnnews-channelschina-militaryshynews2011-1128content_4725893htm accessed 29 November 2011

38 T Wang et lsquoNew SRL station running in San Juan of Argentinarsquo Crustal Dynamics Data Information System nd httpcddisgsfcnasagovlw15docspapersNew20SLR20Station 20Running20in20San20Juan20of20Argentinapdf accessed 9 November 2011

39 Chinese Academy of Sciences lsquoChina Argentina to strengthen cooperation on Antarctic expeditionrsquo 16 August 2010 httpenglishbiccascnNE201008t20100816_57510html accessed 29 November 2011

40 Janie Hulse lsquoChinarsquos Expansion into and US withdrawal from Argentinarsquos telecommunicashytions and space industries and the implications for US national securityrsquo Strategic Studies Institute September 2007 httpwwwstrategicstudiesinstitutearmymilpdffilespub806pdf accessed 7 November 2011

41 Ministry of Science and Technology lsquoChina y la Argentina se reu nen para desarrollar un Centro Binacionalrsquo 2011 httpwwwmincytgovaragendaagenda_detalle phpid_ agendafrac1435 accessed 16 November 2011

42 httpwwwlmneuquencomarnoticias201282avanza-instalacion-de-una-estacion-satel ital-de-china-en-la-provincia_156999 accessed 14 October 2012

43 httpwwwstrategicstudiesinstitutearmymilpubssummarycfmqfrac14 806 accessed 29 November 2011 httpenergyseenewscomnewsargentina-china-sign-nuclear-coop eration-agreement-306141 accessed 3 November 2012

44 For the major reasons that motivated this interest see Lyle Goldstein lsquoChinarsquos Falklands Lessonsrsquo Survival 503 2008 pp 65-66

45 UKNDA Inconvenient Truths Threats Justify Prioritising Defence London UKNDA 2011 p 24

46 La Nacion Buenos Aires lsquoVivir en la Argentina estudiar en Chinarsquo 11 October 2011 http wwwlanacioncomar1413556-vivir-en-la-argentina-estudiar-en-china accessed 9 Novemshyber 2011

47 G M Calderon lsquoInmigracion china en las Americas Comparacion de las experiencias en Canada y Argentinarsquo Revista Argentina de Estudios Canadienses No 2 2008 p 30

48 La Nacion Buenos Aires lsquoChina Una oportunidad histo ricarsquo 26 July 2011 49 Juan Tokatlian lsquoLatin America China and the United States A Hopeful Trianglersquo 2007

Open Democracy httpwwwopendemocracynetdemocracy-protesthopeful_triangle_ 4336jsp accessed 4 November 2011

50 La Nacion Buenos Aires lsquoUna nueva estrategia hacia Chinarsquo 29 August 2011 51 Brantley Womack lsquoBeyond Win-Win Rethinking International Relationships in an Era of

Economic Uncertaintyrsquo Paper presented to the International Conference on the Chinese Models of Development Domestic and Global Aspects Taipei Taiwan September 2011

52 Joseph Tulchin Argentina and the United States A Conflicted Relationship New York Macmillan 1990

53 Russell and Tokatlian lsquoBeyond Orthodoxyrsquo 54 According to the latest report of Latinobaro metro 52 of the Argentines consider Brazil as

the main leader of Latin America while only 2 gives that condition to the United States http wwwlatinobarometroorglatinoLATContenidosjsp accessed 23 November 2011

55 Osvaldo Rosales lsquoLa Republica Popular China y America Latina y el Caribe Hacia una nueva fase en el vınculo econo mico comercialrsquo 2011 ECLAC httpwwweclacorgpubl icacionesxml643666La_Republica_Popular _China_y_America_Latina_y_el_Caribe _ tradepdf accessed 10 November 2011

56 Eric Farnsworth 2011 lsquoThe New Mercantilism Chinarsquos Emerging Role in the Americasrsquo Current History February Available at httpwwwas coaorgarticles2982The_New_shyMercantilism_Chinas_Emerging_Role_in_the_Americas accessed 28 November 2011

Dow

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ded

by [

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02

37 0

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ovem

ber

2014

Journal of Iberian and Latin American Research 267

Appendix 1

Table 1

Argentinean trade with Brazil in millions of dollars 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Exports 6206 4828 4666 5587 6335 8141 10498 13272 11374 14420 Imports 5230 2517 4700 7567 10187 11749 14523 17687 11822 17658 Trade 975 2310 233 21980 23852 23608 24025 24415 2448 23238 balance

Argentinean trade with the United States in millions of dollars 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Exports 2840 2869 3364 3733 4493 4025 4153 5095 3465 3656 Imports 3737 1789 2238 3389 3998 4247 5264 6894 5106 6125 Trade 2897 1080 1126 344 495 2222 21111 21799 21641 22469 balance

Argentinean trade with China in millions of dollars 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Exports 1123 1092 2483 2628 3193 3476 5170 6355 3668 6117 Imports 1066 330 721 1402 2237 3122 5093 7104 4823 7678 Trade 56 762 1762 1227 956 354 77 2 749 2 1155 2 1561 balance

Source INDEC and UNCTAD

Table 2

FDI stock in Argentina by country of origin in millions of dollars (selected countries) 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

USA 16422 7476 7989 10277 11689 12208 13601 13930 14012 14814 of total 238 231 208 182 187 176 175 172 175 168

Brazil 1953 2108 3280 1773 2488 2810 3659 4969 4319 5367 of total 283 651 856 314 397 406 470 614 539 608

China no data no data no data 13 11 45 120 141 123 5500 of total no data no data no data 002 002 006 015 017 015 623

Total 68935 32403 38323 56554 62639 69292 77899 80941 80144 88249

for the years 2001 2002 and 2003 the data for Brazil includes all FDI from South America excluding ChileFrom 2003 onwards the data is exclusively for BrazilSource INDEC and UNCTAD

Table 3

Argentinean trade with the European Union in millions of dollars 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Exports 4698 5309 6079 6209 6844 8010 9901 13173 10278 11026 Imports 4717 2107 2814 4237 4830 5811 7442 9043 6434 7587 Trade 219 3201 3265 1972 2013 2199 2458 4130 3845 3439 balance

FDI from the European Union in Argentina in millions of dollars 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

FDI 38279 18284 21273 33001 36848 40408 45159 45070 44963 47605 of total 5553 5643 5551 5835 5883 5832 5797 5568 5610 5394 Total 68935 32403 38323 56554 62639 69292 77899 80941 80144 88249

Source INDEC and UNCTAD

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  • Abstract
  • The United States and Brazil Losing and Gaining Centrality
  • Relations with China (and Asia) A Historic and Challenging Opportunity
  • Looking Ahead
  • Notes
  • Appendix
Page 3: Implications of the Global and Regional Changes for Argentina's Foreign Relations

252 R Russell and J G Tokatlian

favoured3 In each cycle the nature and strategic meaning of relations between Argentina

and the United States and the neighbouring countries of South America were the main

topic of discussion At present and in contrast to the Cold War years and the nineties

relations with both counterparts are developing in a context marked by a novel process that

has two visible faces the erosion of the United States hegemony in South America and the

progressive consolidation of a specific South American subsystem mainly in the Southern

Cone characterized by the emergence of Brazil as a sub-regional power In this scheme

the previous dominant power the United States is no longer central to Argentina while the

emerging power Brazil plays an increasingly important role for the countryrsquos

international relations In both cases asymmetry defines bilateral relations4 The greater

asymmetry of power with the United States weighs less in the relationship due to

Washingtonrsquos declining interest attention and influence in Argentina Indeed the most

powerful actor has lost a great part of its structural power to shape the structure of the

relationship As a consequence its relational power has also weakened that is its capacity

to make Argentina follow its desires and interests has waned significantly5 The minor

asymmetry with Brazil has become a structural feature of bilateral relations and exercises

on Argentina a different effect than the classic asymmetry with the United States for two

main reasons it does not have the magnitude of the former and it occurs in a geographical

area ndash South America ndash that has unique characteristics regarding interstate cooperation and

competence The sub-regionhas someof the features that define a subsystemofhierarchy a) a

main power that is expected to help order the system and to use its power judiciously and b) a

set of shared expectations about state behaviour based on updated information about state

preferences and intentions shared experiences as well as a deep history that reduces

the security dilemma6 At the same time it exhibits elements which distinguish it from

the hierarchic model These are mainly the absence of a central dominant nation and a set

of shared expectations of rights and responsibilities for both the major and the secondary

powers

The sub-region also has a long and distinctive history of interstate peace and

pacific resolution of conflicts that has been fundamental for mitigating the security

dilemma The countries that comprise it are showing remarkable levels of cooperation

Moreover the main power (Brazil) has good relations with all its neighbours and

there are no foreseeable state threats coming from them Within this context and

under this particular form of asymmetry Argentina and Brazil have found a way not

always easily to accommodate each other At the same time and as in other moments

of redistribution of global wealth and power relations with new regions or countries

also occupy an important place in Argentinarsquos foreign policy agenda After World

War II and throughout the Cold War the Soviet Union and the socialist bloc were

important partners They offered the country technology and key markets for

Argentine exports that faced increasing access restrictions with traditional clients

particularly in Europe Today the focus is Asia especially China as a new and

essential counterpart for Argentina For its part the European Union continues to lose

ground as a key partner a process that has been intensified in recent years by the

EUrsquos relative loss of power international prestige and influence

The question that guides this paper is the following What are the implications of three

particular and key aspects of the overall process of redistribution of power and diffusion of

wealth for Argentinarsquos foreign relations We refer to the relative loss of centrality of the

United States in the Southern Cone the ongoing consolidation of a South American

system with Brazil as the main power and the re-emergence of China and its growing

interest in South America The period under study extends from the beginning of the

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Journal of Iberian and Latin American Research 253

century to the present Argentina has responded to each of these developments in a distinct

manner With the United States it has abandoned the strategy of lsquocouplingrsquo and has

implemented a strategy of lsquolimited oppositionrsquo 7 Towards Brazil Argentina has pursued a

strategy of accommodation seeking to gain benefits but also to retain as much autonomy as

possible Finally vis-a-vis China Argentina has practiced a strategy of lsquoreliable engagementrsquo

that has provided clear benefits but which also seems to be exhausting

Relations with the United States Brazil and China are analysed respectively in the two

following sections The focus of our work is placed on the implications of global and

regional changes in the foreign relations of Argentina It is important to note that these

changes do not fall into Gilpinrsquos category of lsquosystemic changesrsquo The changes to which we

refer here belong to a long duration historical cycle that is still in progress and which is

marked by the redistribution of power and wealth from West to East and from North to

South in the context of globalization8 The resultant changes offer unprecedented

opportunities and challenges to most Latin American countries and demand to a large

extent a rethinking of foreign policy its priorities and exercise The paper concludes with

a section in which we try to put into perspective Argentinarsquos relations with the three above

mentioned countries

The United States and Brazil Losing and Gaining Centrality

Argentina-United States relations have experienced significant changes since the

beginning of the twenty-first century The events of 911 in the United States relegated

Argentina to an even less important position from that it had occupied in the George

W Bush administrationrsquos already reduced Latin American agenda Moreover

Washingtonrsquos decision not to support Argentina when the country defaulted on its debt

in late 2001 was read in Buenos Aires and other Latin American capitals as a clear sign

that lsquocouplingrsquo with the United States goes unrewarded and that the time of the

Washington Consensus was coming to an end Most of the Peronists back in government

after the financial crisis found fresh arguments to criticize Washingtonrsquos coldness as well

as the recipes of the IMF and the neoliberal policies pursued by the country in the nineties

From this moment onwards bilateral relations were gradually dominated by two main

trends the loss of US centrality in the foreign policy of Argentina and the growing

indifference of Washington vis-a-vis Buenos Aires

During the first months that followed the crisis Argentina opted for a lsquoselective

rapprochementrsquo with the Unites States rather than merely band wagoning At that time

Washingtonrsquos role was considered central for overcoming the crisis because of its

influence in the multilateral lending institutions Emboldened by the first signs of

economic recovery Eduardo Duhaldersquos transition government (2002 ndash 2003) began to

voice its opposition to some policies of Washington at the end of his short administration

for example to the US military intervention in Iraq The rapid and even startling recovery

from the crisis and the high growth of Argentinarsquos economy in subsequent years

strengthened the idea in Buenos Aires that the country could grow and develop without

Washington and certainly against its economic prescriptions This notion was reinforced

after the March 2005 agreement with private creditors of the debt in default (76 of the

bondholders) and the cancelation in January 2006 of the US$98 billion debt with the IMF

in a single payment using reserves of the Central Bank Thus over a period of around three

years the United States ceased to be seen as an lsquoindispensable nationrsquo for Argentina

The idea that Argentina could do for the most part without strong ties to Washington

had clear ideological components that came from the inner circle of the Nestor Kirchnerrsquos

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254 R Russell and J G Tokatlian

administration (2003 ndash 2007) However it found its greatest support in the material

conditions offered by a global and regional scenario that opened new and extraordinary

opportunities to the country China became a key trading partner and Brazil behaved as the

closest country to Argentina during and in the years following the crisis Meanwhile the

United States did not devote much time to Argentina let alone the wider South America

This fact was much more than the mere repetition of the United States tendency to put

Latin America in a secondary position in its foreign policy concerns It has to be situated in

the context of the long-term process of U S hegemonic decline in South America

especially in the Southern Cone countries

More specifically the low strategic relevance of Argentina for the United States helps

explain the growing indifference of Washington towards the country This fact is not new

but has intensified during this century Argentina does not have a prominent place in any of

the priority issues on the United Statesrsquo Latin American agenda trade migration drugs

terrorism and public safety and energy A second factor that also explains Washingtonrsquos

estrangement from Buenos Aires is a sequence of bilateral conflictive episodes of high-

voltage in which Argentina played or was seen to play the role of the actor less open to

dialogue and more prone to overacting Vocal criticism on the Argentine side first to the

IMF and later to Washingtonrsquos policies past and present became louder as Argentinarsquos

economy recovered The climax came at the Fourth Summit of the Americas held in Mar

del Plata on November 4 and 5 2005 where the then president of Argentina Nestor

Kirchner firmly opposed lsquoneoliberalismrsquo and the creation of a hemispheric free trade area

(FTAA) and accused the United States of having an lsquoanachronistic viewrsquo of the problems

afflicting developing countries Moreover he called on Bush to have a more responsible

leadership in Latin America by ending his support for policies that had lsquonot only led to

misery and poverty but also the fall of democratically elected governmentsrsquo9 Mar del Plata

marked a turn for the worse in bilateral relations and Washington was left with a bitter taste

that would linger until the end of George W Bushrsquos presidency Moreover while the so

called lsquoArgentine modelrsquo heterodox and lsquoneo-developmentalistrsquo in its economic

orientation did not fit into the category of lsquoLatin American radical populismsrsquo it was

viewed by US officials with suspicion and disgust Although Nestor Kirchner never

subscribed to the tenets of the lsquosocialism of the twenty-first centuryrsquo Washington watched

with dissatisfaction the close links established betweenArgentina and Venezuelarsquos Chavez

After the inauguration of Cristina Fernandez de Kirchner to the presidency of

Argentina in December 2007 new conflicts contributed to deepen lsquomutual detachmentrsquo

Barack Obamarsquos arrival in office in January 2008 was considered by Buenos Aires as an

opportunity to open a new dialogue Moreover the financial crisis in the United States

merely reinforced government beliefs and policies on the role of the state in the economy

and on the need to reform the multilateral lending agencies However with its first

domestic and foreign policies the Obama Administration soon showed that the ideological

affinities world views and purposes were less similar to what at first could have been

imagined at the Casa Rosada President Fernandez de Kirchner rapidly moved from initial

lsquoadmirationrsquo to conclude that President Obama lsquohad not fulfilled the expectationsrsquo and that

his Administration lsquoignores the needs of the Southern Conersquo10

Over the years the distancing on global and regional issues became apparent the threat

and the use of force in the Middle East Central Asia and Northern Africa the conception

and practice of the lsquoResponsibility to Protectrsquo the statehood condition of Palestine the level

and scope of protectionism the promotion and enforcement of stronger financial regulations

worldwide the approach vis-a-vis specific countries such as Iran the half-century old

Cuban blockade the debate and reform over crucial aspects of the Inter-American system

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Journal of Iberian and Latin American Research 255

such as the Inter-American Defence Board and the Inter-American Treaty of Reciprocal

assistance the differences in views and attitudes vis-a-vis a sort of lsquoneo-coupismrsquo

(neogolpismo) in the region such as in Venezuela (2002) Honduras (2009) Ecuador (2010) and Paraguay (2012) and the broadening and militarization of the lsquowar on drugsrsquo However

a simultaneous convergence on important world and continental topics has been evident

acting in favour of nuclear non-proliferation avoiding the presence of transnational

terrorism in the area (for example in the Tri-border zone of Argentina Brazil and

Paraguay) supporting the human rights component of the Inter-American system and

participating in humanitarian missions such as the one in Haiti

In brief by the end of the first year of the second mandate of President Fernandez de

Kirchner and after the re-election of President Obama for a second term the bilateral

relationship remained characterized by little presidential dialogue low shared-

expectations outspoken differences and specific cooperation only on issues of common

interest Key coincidences and several major differences have not been institutionalized in

a general framework by which the mixture of consensus and dissent could be managed On

many occasions first and second-level government officials in Washington and Buenos

Aires overreacted to an incident or underplayed an accord In most cases the perception at

the highest level of each government was one of misunderstanding tiredness and

discomfort

Within this context the fact that Argentina will occupy a non-permanent seat on the

UN Security Council in 2013 ndash 2014 where critical issues will be on the agenda (some of

significance for Buenos Aires including the Malvinas-Falkland question as well as the

lsquovulture fundsrsquo suing Argentina in US courts regarding the 2001 debt default) Requiring

Washington to play a positive role may generate a situation that pushes both countries to

at least devise an improved consultative mechanism in order to handle their relationship

with more maturity and realism

Relations between Argentina and Brazil have been marked by the increase in

asymmetries between the two countries in terms of capabilities as well as in international

projection Since the crisis of 2001 Argentina has undergone a gradual process of

economic and self-esteem recovery whereas Brazil has consolidated its position as an

emerging power both regionally and globally These developments together with the loss

of US centrality in South America and Mexicorsquos growing links and interdependence with

North America have dramatically altered the geopolitical landscape in Latin America

particularly in South America

Three distinct phases can be highlighted in the Argentine-Brazilian relationship

since the beginning of the twenty-first century11 The first extends from the crisis of

2001 through 2003 and is characterized by the growing importance given to Brazil by

the elites and public opinion in Argentina While other governments were abandoning

Argentina the Fernando Henrique Cardoso Administration expressed solidarity with

the government led by Eduardo Duhalde during the time of crisis arguing that the

International Monetary Fund could not be insensitive to the serious situation which

afflicted Argentina and said that Brazil continued to trust in its main Mercosur

trading partner Later with Lula already in the Planalto the idea of Brazil as

lsquoalternative development modelrsquo to the one implemented in the 1990s and as the

lsquomain cardrsquo of Argentinarsquos international insertion became dominant in Buenos Aires

Nestor Kirchner took office in May 2003 stating Brazilrsquos importance for Argentina

and emphasized the need to give more weight and density to a common strategic

project However this positive vision of the bilateral relationship was expressed at the

beginning of a phase in which Argentina was leaving behind the crisis With gradual

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256 R Russell and J G Tokatlian

recovery came the revival in Argentina of an ambiguity vis-a-vis Brazil Although

Brazil was seen as a key player and partner it also raised suspicions and doubts

throughout the whole Argentine political spectrum Its status as an emerging power

produced concerns For the Right in Argentina the Lula presidency gave reasons to

refloat the perception of Brazil as an lsquoincorrigiblersquo country The different assessments of

the strategic condition of South America vis-a-vis Latin America also reappeared and with it

fears of a possible Brazilian hegemony in South America The government of Fernando de la

Rua (1999ndash2001) had had a preventive and defensive attitude about the political idea of South

America proposed by Brazil ndash a political and economic geographic area with its own

peculiarities and different from the lsquoLatin America of the Northrsquo The government of Nestor

Kirchner also adopted a reluctant position An eloquent example of this attitudewas President

Kirchnerrsquos decision not to attend the gestation of the South American Community of Nations

meeting (prior to its transformation into the Union of SouthAmericanNations) in 2004 on the

grounds that it was an instrument created by Brazil to project and ensure its own power in

the region

References to Brazil arose in the context of a stagnating Mercosur Repeated promises

to give the bloc a new birth ndash the so called lsquorelanzamientorsquo ndash could not hide that in terms

of its economic significance Mercosur exhibited clear signs of exhaustion Moreover

similar views in both capitals about the lsquodevelopment modelrsquo did not help to give more

oxygen to the integration process The convergence between Kirchner and Lula on the

need to restore the lsquoindustrialistrsquo vision of integration as opposed to the lsquocommercialrsquo

approach of the nineties gave the impression that the two countries were ready to give its

ties a new strategic perspective However the bilateral agenda of lsquoproductiversquo integration

and Brasiliarsquos acceptance of the importance of the lsquore-industrializationrsquo of Argentina were

interpreted in Buenos Aires as a right to establish protectionist measures for Brazilian

exports that threatened the national industry and even more to ignore certain rules This

propensity for defensive policies not only emphasized the lsquofatiguersquo of Mercosur but also

contributed to the low willingness on the part of Brasilia to accept limits to the

autonomous management of its foreign policy Integration never ceased to be a goal for

Brazil but with time acquired a minor role in the priorities of its foreign policy Its

systematic rejection of a surrender of elements of sovereignty and autonomy to the

Mercosur was one of the determinants of the institutional weakness of the bloc Moreover

as Monica Hirst has put it lsquothe importance of the South American economies as a space for

a larger expansion of the Brazilian companies and the statersquos presence as an investor

(Petrobras) and financier (BNDES) [Brazilian Development Bank] became more

important for Brazilian material and strategic interests that the regional integration

process especially the Mercosurrsquo12 In short ambiguous perceptions coexisted in

Argentina with fluctuating bilateral relations The setting was propitious for the

reappearance of anti-Brazil perceptions in Argentina The pro-Brazilian episodic euphoria

of the years of Duhalde (Brazil as a lsquogreat strategic allyrsquo) turned into doubt and criticism in

the second phase which goes from the beginning of 2004 to the end of 2006 Explicitly

and implicitly by both the Right and the Left an ambivalent feeling towards Brazil

unfolded albeit without the pugnacity of the past but nevertheless highlighting the

difficulties of embedding a culture of friendship between the two countries13

As in other debates in Argentina these visions were remnants of perceptions forged in

the seventies and nineties Kirchnerrsquos own ambiguities style and measures in government

did not help to build a more positive image of the role of Brazil for Argentina Several

groups located in the Ministry of Foreign Affairs the business world think-tanks and the

media encouraged the counterbalancing of Brazil in lsquoSouth Americarsquo by means of a

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Journal of Iberian and Latin American Research 257

lsquoLatin-Americanrsquo policy in which the role of Mexico was presented as crucial On the

other hand the vision of Chile as a partner for a more balanced South America and as an

economic model also regained strength in a wide spectrum of the Argentine elites covering

the Right to the centre-Left Chilersquos image was contrasted with that of Brazil The first was

seen essentially as lsquopredictablersquo and lsquoreasonablersquo while the second after the triumph of

Lularsquos Workers Party tended to be presented on the opposite side For some closer

relations with Chile would serve to offset the influence of Brazil in the Southern Cone ndash a

Santiago ndash Buenos Aires axis to limit the Brazilian aspiration to lead the area ndash while

others perceived the lsquoChilean wayrsquo as the best manner for taking a safe distance from

Mercosur which was perceived as an obstacle to establishing a flexible dense and fruitful

relationship with the rest of the world Finally the Left identified the relationship with

Venezuela as a balancing factor for restraining the power of Brazil

The third phase of Argentine ndash Brazilian relations started at the end of 2006 and

extends to the present An interesting twist can be observed in the direction of a more

positive perception of Brazil that clearly puts it in a central place for Argentina Two main

factors explain this change The first and most important is the growing international

relevance and regional weight of Brazil This process has led to the formation of a

widespread perception in Argentina that defines Brazil as lsquoinevitablersquo with a predominant

negative and generally pessimistic bias or as a country that is lsquoindispensablersquo in this case

emphasizing the possibility of building a common future and a strong cooperative

relationship The idea of Brazil as a necessary country is widely accepted but has

variously been accepted with resignation disgust and joy alternatively viewed as an

opportunity or severe challenge The lsquosuccessrsquo of Brazil is often contrasted with the

lsquofailuresrsquo of Argentina and generates different feelings such as pain envy nostalgia and

desire for emulation In any case the growth and rise of Brazil has converted it into a

model for almost everyone The second factor is the growing density of bilateral relations

As an example it is interesting to note that Brazil is already the fourth largest foreign

investor in Argentina after the United States Spain and China In 2010 24 of total

exports (42 industrial) and 82 of the cars manufactured in Argentina were directed to

the Brazilian market and 863492 Brazilian tourists visited the country14 At the same

time the expansion of Brazilian companies in Argentinarsquos productive activity and trade

has been impressive in the last decade

The main issue for the future then is how to live and interact with the lsquoinevitablersquo or

lsquoindispensablersquo country This convergence of perceptions regarding the centrality of Brazil

for Argentina only goes so far There is no agreement on the political economic and

strategic interests that should constitute the relationship with Brazil and consequently

about the best ways to put them into practice The transition from an entrenched culture of

rivalry to an incipient culture of friendship has lasted more than a quarter of a century

providing promising dividends for both nations and offering a good platform from which

to renegotiate the growing bilateral ties The world and the region and the national

situation of the two countries especially concerning the distribution of attributes of

economic power are now very different to the 1980s when the two countries took the first

steps to build a positive bilateral relationship The double condition of the Argentine ndash

Brazilian relationship that is its increasingly close and uneven character suggests that

there will be a complex combination of convergence and divergence between the two

nations Argentina and Brazil never were Pakistan and India in terms of antagonism and

sought in the past to jointly become an equivalent to the Franco ndash German axis for the

integration of South America an aspiration that today is unsustainable Circumstances

have changed and the condition of lsquoasymmetric interdependencersquo is recognized and

Dow

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ovem

ber

2014

258 R Russell and J G Tokatlian

accepted in Argentina although not without the suspicions that characterize the attitudes

of the weaker party in a bilateral relationship In this context the main challenge for

Brasilia and Buenos Aires is to forge a realistic and positive lsquonew dealrsquo that contemplates

with its own specificity the bilateral relationship as well as Mercosur

In the end the above-mentioned three phases show the existence of both a changing

and intricate relationship If the theory of asymmetry is taken into consideration the first

move towards re-negotiating an unbalanced relationship should be initiated to a large

extent by the less powerful party In that sense it is yet unclear what the Argentine elites

(civilian and military economic and intellectual state-based and non-governmental) want

from relations with the continent (including the United States) the Spanish-speaking

region South America and finally Brazil Historically it has been quite difficult for

Argentines to have simultaneous positive relations with Washington and Brasilia In the

last two decades different opinions (sometimes personal more than collective) between

the lsquoLatin-Americanistsrsquo and the lsquoSouth-Americanistsrsquo favouring opposite strategic

options have been vocally expressed Currently several other countries in the area have

been increasing their leverage especially those facing the Pacific This phenomenon does

not go unnoticed by Argentine elites and is another source of domestic debate In this

dynamic and changing regional context Argentina has not been able to clearly establish

the goals and ambitions to guide its foreign policy towards the region and Brazil in

particular The response to this situation should be sought in essence in domestic politics

Relations with China (and Asia) A Historic and Challenging Opportunity

Argentine ndash Chinese links should be placed in the larger context of China ndashLatin America

relations15 From a Latin American perspective Chinarsquos growing presence in the region

has been seen at least in the first decade of the twenty-first century as a promising trend

Chinarsquos ties with Latin America from the 1950s to the 1970s were marginal focused

primarily on cultural diplomacy driven by ideological motives and based on

revolutionary rhetoric This diplomatic strategy relied on the dividends of destabilization

was accompanied by anti-US slogans and was geared toward strengthening pro-Chinese

(and anti-Soviet) political parties and movements Chinarsquos international behaviour during

that period was that of a revisionist actor who sought to change the rules of the game

through aggressive means

In contrast Beijingrsquos approach to the region since the 1990s has involved an active

economic diplomacy characterized by pragmatism conciliation and stability Chinarsquos key

goal and main challenge has been to deepen its relations with the countries of Latin America

without irritating Washington Diplomatically China has proceeded in a judicious fashion

which explains in part why regional forces did not emerge to veto a policy of prudent and

consistent engagement toward China In addition Chinarsquos external diplomatic model has

been seductive to Latin America especially during the two administrations of George

W Bush in the United States multipolarism as opposed to unipolarism multilateralism as

opposed to unilateralism non-interference as opposed to interventionism soft power as

opposed to hard power pragmatism as opposed to ideologisation collaboration as opposed

to domination and persuasion as opposed to coercion All have been attractive notions in

Latin America Chinarsquos contemporary approach coincides with strong Latin American

traditions and aspirations and has become more captivating by virtue of the mishandling

disregard and thoughtlessness of US foreign policy towards the region

Nothing indicates that Latin America is geared towards accepting a paternalistic

externally-induced security dilemma with China and the region does not feel insecure visshy

Dow

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ovem

ber

2014

Journal of Iberian and Latin American Research 259

a-vis Beijing despite certain ideologically-driven pressure groups in Washington

Moreover the Sino ndash Latin American ndash US triangular relationship has not engendered

major tensions or unmanageable challenges16 There is also nothing to suggest from a

regional viewpoint that Latin America ndash China ndash United States relations are destined to an

apocalyptic geopolitics approach based on an overblown fear of an alleged Chinese

takeover of the region China is not the Soviet Union post 911 is not a rehearsal of the

Cold War Washington is no longer at the pinnacle of world power and Latin America has

not collapsed after the Western economic and financial crisis began in 2008 There is also

no indication that Chinarsquos intention is to challenge the United States in the Western

Hemisphere In fact the Chinese government has actively sought to convince the United

States and the rest of the world that its intentions are benign thus the self-portrayal of a

peaceful rise

Chinarsquos behaviour in Latin America at the outset of the twenty-first century has been

far from that of a revisionist power On the one hand Beijingrsquos strategy has combined

necessity with opportunity and has been put into practice cautiously and diligently

curtailing the likelihood that the region will develop or adopt a policy aimed at rolling

back Chinarsquos presence On the other hand Latin Americarsquos relationship with Beijing is

more dependent on economic facts than political conceptions As there is no major

ideological concern in most countries about dealing with China the crucial element is the

material effect of Sino ndash Latin American linkages the level of dependency of the region

vis-a-vis China the degree of de-industrialization of the area derived from bilateral trade

and the ecological consequences of Chinese investment in Latin America17

This broader framework is essential to understand the dynamics of Argentinarsquos

relations with China in the larger context of Argentinendash Asian links Over the past two

decades the (re)emergence of China and the ascent of Asia have been a blessing for

Argentina Rising demand and higher prices for commodities have made it possible for

Argentina to elevate and diversify its trade flows with the East Since the 1990s and

despite the discernible differences in economic and foreign policies between Carlos

Menem and the Kirchners Argentina has developed a new pattern of production that has

led notwithstanding the crisis of 2001 to a reorganization of the economic base of the

country As noted by Pablo Gerchunoff lsquoIt is not just about the speed of exports there is

also a significant diversification traditional agriculture new agriculture industry energy

and mining concurred to modify the national economic landscapersquo18 In that context and

according to President Nestor Kirchner it was crucial lsquothrough China to search in Asia the

leverage to re-industrialize Argentinarsquo Economy not politics has been the driving force

to improve and extend Argentine relations with the East19

For the first time in more than seven decades Argentina has met a world that eagerly

requires what it produces The key driver of this demand is located in China but covers a

wide range of countries At present China is Argentinarsquos second largest trading partner

both in terms of the origin of imports and recipient of exports ndash in both dimensions after

Brazil and before the United States (See Table 1) Argentina meanwhile ranks third in the

list of the 15 major suppliers of agricultural products which supplied 90 per cent of

Chinese imports in 2010 United States (244) Brazil (136) and Argentina (73)

Other major suppliers were the European Union (6) Australia (5) and Malaysia (5)

By 2001 Argentine exports to China surpassed the US$1 billion barrier to hit US$1123

billion and imports totalled US$1066 billion Thus there was a small surplus of US$56

million in favour of Argentina By 2010 the commercial exchange was worth US$13795

billion totalling US$6117 billion in Argentine exports and US$7678 billion in Chinese

exports The result was a trade balance of US$1561 billion in Chinarsquos favour20 In the

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260 R Russell and J G Tokatlian

period January ndashSeptember 2011 the surplus in favour of China grew While Argentine

exports amounted to US$4746 billion Chinese exports came to US$7569 billion21

India is Argentinarsquos main Asian trading partner after China22 Other important

countries are Indonesia South Korea Malaysia Vietnam and Thailand23 By 2010 when

China implemented barriers to Argentine soybean oil in retaliation for local action that

prevented the entry of Chinese products into the country Argentina reoriented its soybean

exports to India which bought 14 million tons of soybean oil (corresponding to US$12

billion dollars) In September 2011 Indiarsquos ambassador in Argentina said his country

would increase demand for soybean oil over the next ten years from the current 8 million

to 15 million tons representing a significant additional opportunity for Argentine

producers and exporters24

Indeed ties with Asia are not limited to trade Again the paradigmatic case of this

new relationship is China which in recent years has also emerged as an increasingly

important financial actor During 2009 at a high point of the US-originated financial

crisis China and Argentina agreed to swap US$10 billion worth of their currencies in

order to enable Argentina to avoid using dollars in trade between both countries an

agreement that was the first of this sort between China and a South American country25

Beijing simultaneously accelerated its investment in agriculture mining energy and

banking and has become the third largest investor in the country (See Table 2)26 In

addition there is strong Chinese interest for participation in infrastructure development

projects in sectors such as railways roads ports and telecommunications The largest

food company in China Heilonjiang Beida-Huang signed an October 2010 cooperation

agreement with the province of Rıo Negro27 which provides China with twenty-year

leases on provincial lands (20000 hectares at an early stage that may eventually extend

to up to 320000 hectares)28 In return the Chinese company is committed to

undertaking major irrigation and infrastructure works as part of a ten-year investment of

US$15 billion dollars29 Different actors from Argentina are also opening trade offices

in Chinese cities and several twin cities and sister provinces have signed different 30agreements

In the oil sector the China National Offshore Oil Corporation (CNOOC) acquired 50

per cent of Bridas Corporation and Sinopec holds 100 per cent of Argentine assets in

Occidental In addition China controls 50 per cent of the Cerro Dragon field and will

handle major reserves for 40 years in the province of Santa Cruz To sum up Beijingrsquos

growing interest in Argentina has meant that the country is according to Levi J Jordan

from the Americas Society lsquoreceiving almost half of Chinarsquos investment in South America

over the past two yearsrsquo31 In that context the growth of Chinarsquos state corporations is

impressive32 Agreements have also been made in the field of defence the most prominent

is the signing of the Memorandum of Understanding for Strengthening Exchanges and

Cooperation in Defense of 16 May 2007 whereby both countries have committed to

maintain contacts to discuss global and regional security issues to cooperate on military

equipment and logistics and to establish a Defence Joint Commission It is worth

mentioning that officers from Argentina together with military from Chile and Colombia

frequently (more often than counterparts from Cuba and Venezuela) have attended courses

on grand strategy at Beijingrsquos elite national defence university PLANDU33 Even though

Argentina is not a significant South American buyer of military equipment34 has a very

low annual defence budget and that China is not the major supplier of arms to the region

(as it is the case of the United States Russia and the European Union) it has lately

considered the acquisition of Chinese Z-11 helicopters35 Finally after a July 2012 visit to

China by Argentine Defence Minister Arturo Puricelli both countries agreed that

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2014

Journal of Iberian and Latin American Research 261

Argentina will construct a prototype of that helicopter by 201336 In general the level of

bilateral military dialogue is highly positive37

In key scientific and technological areas there has been an on-going improvement of

relations For example a Satellite Laser Raging (SLR) system designed and made in China

was installed in the Observatory of San Juan University38 Both countries plan to conduct

collaborative activities for Antarctic expedition39 There are many contacts and joint

initiatives in the areas of telecommunications and space40 The two countries are also

interested in creating a Bilateral Centre on Science and Technology for Food41

In addition China will install a satellite station in the province of Neuquen42 while

incrementing its presence in the telecommunications sector and establishing cooperation

ties in the nuclear field43

Argentina and China share important interests in their diplomatic agenda with regards

to the defence of the principle of lsquoterritorial integrityrsquo China consistently supports the

Argentine claim of sovereignty over the MalvinasFalklands while Argentina defends the

policy of lsquoone Chinarsquo which implies the non-recognition of the independence of Taiwan

and Tibet The issue of the MalvinasFalklands Islands has been surfacing for two reasons

On the one hand as Lyle Goldstein has remarked lsquoChinese defence analysts take such

intense interest in the Falkland Warrsquo due to the fact that according to Chinese government

officials and experts there are certain similarities between the Malvinas and Taiwan44 As

Taiwan is a vital issue for Beijing the understanding of the 1982 war in the South Atlantic

is extremely relevant On the other hand the potential closeness of China and Argentina

may provoke in the future a vulnerable situation with regards to the islands that could

affect British defence policy45 In times of a major economic crisis in Europe and with

diminishing possibilities of sustaining high defence budgets retired military officers from

Great Britain overemphasize Londonrsquos potential weakness in the South Atlantic

With respect to issues on the global agenda the two countries agree at the level of the

G-20 on the need for greater participation of emerging nations in international financial

organizations as well as the need to implement measures for the avoidance of financial

speculation that causes volatility in the prices of commodities Both countries have been

supporting peacekeeping operations and they both participate militarily in the UN Mission

in Haiti At the International Atomic Energy Agency Beijing and Buenos Aires have been

active in the promotion of non-proliferation

It is important also to mention a relatively new phenomenon in the relation between

Beijing and Buenos Aires namely Chinese immigration to Argentina There are

approximately 120000 Chinese and Chinese-descendants in Argentina mainly in Buenos

Aires46 Their point of origin is mostly Taiwan and Fujian and to a lesser extent Hong

Kong Even though there are no good estimates or different in-depth studies lsquoChinese

immigration to Argentina is assumed to be largely of illegal naturersquo with lsquoremittances an

important flow of capitalrsquo and Argentina being lsquoan intermediate stoprsquo for approximately

half of the Chinese migrants before seeking entry into the United States (mainly) or the

European Union47

To sum up the capabilities willingness and needs of both sides make the relationship

between Argentina and China (and Asia) complementary The East needs raw materials

(energy food and mining) and Argentina needs investments and infrastructure Of course

a link of this nature presents opportunities but also brings risks It has become fashionable

in Argentina to compare the current situation with the golden years of the lsquospecial

relationshiprsquo with Great Britain (and Europe) that was undoubtedly the engine of the great

Argentine take off between 1880 and 1914 It is also noted that the new relationship with

Asia offers great benefits to the neighbouring countries and therefore does not threaten the

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262 R Russell and J G Tokatlian

harmony existing in the sub-region48 While recognizing the historic opportunity offered

to Argentina by the (re)emergence of China and the advancement of several Asian nations

others emphasize the risks especially those coming from China

Within that context it is relevant to mention that the highly optimistic somehow-naive

phase of Chinese ndash Latin American relations is experiencing changes including in

Argentina ndash China relations Most countries in the region and among them Argentina are

slowly moving from a strategy of lsquoreliable engagementrsquo49 to a more mixed strategy based

on a prudent approach that combines strong commercial ties and active damage-control

policies50 Latin American countries are well aware of the importance of key economic

issues and the sensitive security questions that characterize the regionrsquos relations with

China Concerns about de-industrialization via commodity-based export growth (affecting

basically South America) the effect of global lsquocurrency warsrsquo on the region (affecting all

of Latin America) and the impact of a decisive push for rural production within China

(affecting mainly Mexico and Central America) are extremely critical issues from North to

South America

On a broader outlook the fact that the global system is witnessing a period of

uncertainty is generating a new examination of Chinarsquos lsquowin-winrsquo diplomacy51 This is a

time of difficulties that places limits on Beijingrsquos global and regional strategies Not

surprisingly Argentina as well as other countries in Latin America is rethinking its ties

with China under a more nuanced viewpoint The advantages and dividends of more

commercial and financial links with China are superseded by new productive challenges

(for example excessive emphasis on commodities for export) at home and sensible

differences abroad (for example in the case of human rights) Interests and values are now

inextricably intertwined in Argentine ndash Chinese diplomacy In this context the deployment

of a more sophisticated policy vis-a-vis Beijing seems inevitable Necessity more than

willingness is pressing Buenos Aires to design a broader Asian strategy where China will

be a centrepiece but not the only counterpart politically and materially for the country

Looking Ahead

Argentinarsquos foreign policy developed historically from 1880 until the early twenty-first

century around three areas Europe the United States and Latin America especially the

Southern Cone countries Relations with the socialist world particularly with the Soviet

Union for political and commercial reasons were also important in the second half of the

twentieth century but never reached the scale of the other three axes In the decade since

2000 a fourth axis has been added to this traditional pattern with extraordinary strength

and projection the Asia Pacific region dominated by China

Relations with Europe remain important since there are shared interests and values and

a long history of mutual interaction In addition Argentina continues to need European

investments and technology transfers and the EU is still an important trading partner (See

Table 3) But Europe like Japan and the United States is a market in which exports have

shown in the last decade ceilings that are difficult to overcome The most dynamic and

consolidated markets for Argentina are in Latin America and Asia There are also other

developing markets that are growing at a faster pace than the rest of the world and offer

new opportunities for Argentine exports (Australia Canada Russia South Africa and

Turkey) In the next years Europe will focus its attention on domestic issues and other

areas of the world It is unlikely that any significant progress in the relations with

Argentina and Mercosur could be made in the short run A longer-term view suggests that

Dow

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2014

Journal of Iberian and Latin American Research 263

Europe will increasingly lose its relative importance for Argentina and that its historically

privileged position in the countryrsquos foreign relations will be a thing of the past

Argentinarsquos relations with the United States have never been easy Joseph Tulchin

summarizes its nature in the title of his well-known book Argentina and the United States A Conflicted Relationship52 The strategy of lsquocouplingrsquo implemented during the Menem

years was a pragmatic adaptation to the world of the immediate post-Cold War and was

buried as a strategic option for Argentina with the 2001 crisis In the decade of 2000 the

Kirchners went back to the traditional historical pattern that we have called lsquolimited

oppositionrsquo53 This pattern which combines collaboration and disagreement deference

and resistance will continue to guide Argentinarsquos foreign policy toward Washington but

in a framework in which Buenos Airesrsquos concerns about restraining the United States

preponderance and power will tend to decrease Present conditions offer a great lsquoobjectiversquo

opportunity for the development of new areas of selective collaboration between the two

countries at the bilateral and regional levels A new era of relations with the United States

seems to be beginning for the Southern Cone one that is less unequal and perhaps more

cooperative The key challenge for Argentina is coping with a new reality of diminishing

influence of Washington in the sub-region Most of the time power erosion produces two

alternative behaviours adaptation or denial At least for the time being the relative decline

of US hegemony in South America is showing signs of a lsquosoft landingrsquo If this scenario

prevails then Argentina may manage its bilateral relation with the United States in a more

constructive way

In the case of Brazil it seems that we are entering a second long cycle of convergent

views about the place of this country in Argentinarsquos foreign policy54 This cycle may be

compared and opposed to another long period of convergent visions that characterized the

dominant form in which the neighbour country was perceived by the Argentine elites

during most of the twentieth century Today Brazil is defined as a strategic partner while

in the past until the return of both countries to democracy it was seen as a rival As we

have already mentioned the main challenge for Argentina is how to build this strategic

partnership within a framework of growing asymmetry

The link with Argentina although very important does not have today the same value

for Brazil as in the second half of the eighties By contrast the relationship with Brazil is

increasingly relevant for Argentinarsquos foreign relations and one that presents a significant

challenge In the past the relative symmetry between both countries was a constant source

of suspicion and conflict In the future the condition of asymmetric interdependence as a

structural feature of the relationship will not allow for competition but also is no

guarantee of friendship or cooperation Rather it can become a new source of suspicion

distrust and differences Argentina and Brazil will have to learn to live together in this new

reality and develop a broader framework of mutual understanding to manage the major

density of bilateral links and the global issues of common interests The greatest effort

must come from Argentina because it is the country that has a higher interest in the

relationship and more to gain

Finally the emergence of Asia is offering Argentina a unique opportunity for a

dynamic and successful international integration Its most recent economic dynamism is a

direct result of the increased demand from China and other Asian countries for food and

raw materials However Argentinarsquos exports to Asia are highly concentrated in the

soybean complex and to a much smaller extent in a small group of primary and natural

resource intensive products According to the latest ECLAC report five major products

accounted for 92 of total exports from Argentina to China during the years 2007 ndash 2009

(soybean 531 soybean oil 265 crude oil 747 other cattle 248 and meat and

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2014

264 R Russell and J G Tokatlian

poultry offal 233)55 Moreover the trade surplus with China has tended to evaporate

after several years of significant positive balances

This situation raises many questions about the Argentine specialization pattern ndash

beyond issues related to trade with China ndash and the need to reduce an excessive

dependence on the export of commodities Nevertheless as the benefits of trade with

China have been so high and have also enabled Argentina to successfully face and resist

the financial crises in the centres the propensity to do nothing is great As Eric Farnsworth

recently observed lsquoWhen nations are able to sell as much as they can produce of any

particular product the thinking is generally to continue doing so and reap the rewards

When economies are growing there is little political imperative or incentive for reformrsquo56

In consequence a relevant question surrounding this type of relationship is how to avoid

the temptation to inertia The tendency towards passive repetition is appealing The China

lsquochallengersquo in the early twenty-first century for Argentina is how to think and act

differently from what had been the case of Argentine ndash British relations at the beginning of

the twentieth century The framing of a different link with Beijing as well as the positive

handling of an increasingly complex multifaceted multilevel relationship with Brazil

seem to be the major challenges ahead for Argentinarsquos foreign relations

Notes 1 Roberto Russell and Juan G Tokatlian El lugar de Brasil en la polıtica exterior argentina

Buenos Aires Fondo de Cultura Econo mica 2003 pp 45 ndash 59 2 We use the concept lsquosystemic changesrsquo in the same sense as Robert Gilpin See his book War

and Change in World Politics Cambridge Cambridge University Press 1981 pp 42ndash 43 3 For an interesting analysis of these debates see Jose Paradiso Debates y trayectoria de la

polıtica exterior argentina Buenos Aires Grupo Editor Latinoamericano 1993 4 On the concept lsquoasymmetryrsquo and its implications for bilateral relations see Brantley Womack

lsquoAsymmetry and Systemic Misperception China Vietnam and Cambodia during the 1970rsquosrsquo Journal of Strategic Studies 262 June 2003 pp 92ndash 119

5 On structural and relational power see Susan Strange States and Markets An Introduction to International Political Economy London Pinter 1988 pp 25ndash9

6 David C Kang lsquoThe theoretical roots of hierarchy in international relationsrsquo Australian Journal of International Affairs 583 September 2004 p 339

7 Roberto Russell and Juan G Tokatlian lsquoBeyond Orthodoxy Asserting Latin Americarsquos New Strategic Options Toward the United Statesrsquo Latin America Politics and Society 533 Winter 2011 pp 129 ndash 134

8 Eric Hobsbawm lsquoDespues del siglo XX un mundo en transicionrsquo in Ricardo Lagos (ed) America Latina iquestintegracion o fragmentacion Buenos Aires Edhasa 2008 pp 29ndash 47

9 Remarks by the President of the Argentine Republic Nestor Kirchner at the inauguration of the IV Summit of the Americas Mar del Plata httpwwwsummit-ameicasorgDocuments 20del20presidente20de20RepC3BAblica20Argentinapdf

10 La Nacion (Buenos Aires) lsquoCristina Kirchner critico a Obama con duros terminosrsquo 26 February 2010 Available at httpwwwlanacioncomar1237368-cristina-kirchner-criticoshya-obama-con-duros-terminos accessed 17 November 2011

11 For more in depth analysis of the bilateral relations see Russell and Tokatlian El lugar de Brasil pp 45ndash59 and Roberto Russell and Juan G Tokatlian lsquoPercepcoes argentinas sobre o Brasil ambivalencias e expectativasrsquo Polıtica Externa 202 September 2011 pp 43ndash 56

12 Monica Hirst lsquoLa polıtica sudamericana de Brasil entre el peso de las asimetrıas y la incidencia de nuevas coyunturasrsquo in F Calderon (ed) Escenarios polıticos en America Latina Conceptos metodos y Observatorio Regional Cuadernos de Gobernabilidad Democratica 2 Buenos Aires PNUD Siglo XXI 2008 p 257

13 We use the concept of friendship following Alexander Wendt Social Theory of International Politics Cambridge Cambridge UP 1999 pp 297ndash 308

14 La Nacion Economıa y Negocios Buenos Aires lsquoBrasil en la vida cotidiana argentinarsquo 22 May 2011 p 1

Dow

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ber

2014

Journal of Iberian and Latin American Research 265

15 On China ndash Latin America relations at the beginning of the XXI Century see Juan G Tokatlian lsquoA view from Latin Americarsquo in R Roett and G Paz (eds) Chinarsquos Expansion into the Western Hemisphere Implications for Latin America and the United States Washington DC Brookings Institution Press 2008

16 According toMark P Sullivan a specialist on Latin American affairs at theUS Congressional Research Service lsquoThe balance of opinion toward China and the United States in Latin America tend to be roughly comparable according to a (2007) Pew study Two exceptions are Argentina where China is viewed much more favorably than the United States and in Mexico where the United States is viewed much more favorably than Chinarsquo See Thomas Lum (ed) lsquoComparing Global Influence China and US Diplomacy Foreign Aid Trade and Investment in the Developing Worldrsquo in CRS Report to Congress August 15 2008

17 Kevin Gallagher lsquoLatin Americarsquos China challengersquo 2011 Policy Innovations httpwwwase tuftsedugdaePubsrpGallagher_PolicyInnovationsJan11pdf accessed 18 November 2011

18 Pablo Gerchunoff 2010 lsquoCausas y azares en mas de un siglo de historia econo mica argentinarsquo in R Russell (ed) Argentina 1910ndash2010 Balance de un siglo Buenos Aires Taurus p 152

19 See the complete quote in Sergio Cesarin lsquoChina y Argentina Enfoques y recomendaciones para potenciar la relacion bilateralrsquo Serie Aportes 2010 httplibraryfesdepdf-filesbueros argentinien07560pdf accessed 28 November 2011

20 Based on INDEC 2011 and Comercio Exterior Argentino 2010 httpwwwindecgovar accessed 13 November 2011

21 Camara de Exportadores de la Republica Argentina En Contcto China No 43 November 2011 p 16

22 In October 2009 President Cristina Fernandez de Kirchner visited India It was her first trip to an Asian country after her inauguration in December 2007 and it was the first visit of an Argentine president to India since 1994

23 It is important to mention the cases of Indonesia and Vietnam for two reasons the growth of trade in the last decade and the fact Argentine exports to these two countries are mainly nonshytraditional commodities For example exports to Indonesia jumped fromUS$43million in 2001 to US$852 million in 2010 while exports to Vietnam grew from US$60 million in 2001 to US $654 million in 2010 Cların iEco Buenos Aires lsquoArgentina en mas puertosrsquo 28 August 2011

24 La Nacion Economıa y Negocios Buenos Aires lsquoLa soja argentina ahora apunta a la Indiarsquo 15 September 2011 p 3

25 China Daily lsquoArgentina China sign tentative swap dealrsquo 31 March 2009 httpwww chinadailycomcnchina2009-0331content_7635007htm accessed 11 November 2011

26 Argenpress (Buenos Aires) lsquoInversiones chinas en la Argentina Claves del nuevo escenario energeticorsquo 14 June 2011 httpwwwargenpressinfo201106inversiones-chinas-enshyargentina-claveshtml accessed 19 November 2011

27 See text of the agreement at httpwwwgrrorgarrionegro-chinaacuerdo-saiz-chinapdf accessed 26 Nov 2011 and El Cronista Buenos Aires lsquoChina invierte 1500 millones en Rıo Negro para asegurarse alimentosrsquo 9 June 2011 httpwwwcronistacomnegocios China-invierte-us-1500-millones-en-Rio-Negro-para-asegurarse-alimentos-20110609-0033 html accessed 19 November 2011

28 On other actual and potential Chinese investments in Argentine provinces see Camara Argentino China Negocios con China 2011 httpwwwargenchinaorgarticulos_2010 NegociosConChinapdf accessed 14 November 2011 and FUNDAMIN lsquoChina invierte en las 23 provincias argentinasrsquo httpfundamincomaresinfo36-exportaciones-e-importaciones 299-china-invierte-en-las-23-provincias-argentinashtml accessed 19 November 2011

29 httpwwwnoalaminaorgmineria-informacion-generalgeneralargentina-china-recreacionshyde-la-vieja-qrelacion-especialq-con-gran-bretana accessed 20 January 2012

30 lsquoLas relaciones entre China y Argentinarsquo httpespanolcricn1161201211281s264119 htm accessed 17 November 2011

31 lsquoRailway rapprochement China invests in Argentinarsquo 2010 httpwwwas-coaorgarticles 2528Railway_Rapprochement_China_Invests_in_Argentina accessed 17 Nov 2011

32 Silvia Simonit lsquoLas empresas chinas en Argentinarsquo Chinese Studies Working Paper Series (Universitat Pompeu Fabra) No 1 2011

33 Loro Horta lsquoIn Uncle Samrsquos Backyard Chinarsquos Military Influence in Latin Americarsquo Military Review September-October 2008 p 48

Dow

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ovem

ber

2014

266 R Russell and J G Tokatlian

34 As are the cases of Brazil Chile Colombia and Venezuela 35 Seguridad y Defensa lsquoEl Ejercito Negocia con China la compra de helico pterosrsquo 10 October

2010 httpwwwseguridadydefensacomarnoticiasejercito-negocia-con-china-la-comprashyde-helicopteros-25059html accessed 10 November 2011

36 httpwwwelmetroonlinecomarindexphpoption frac14com_k2ampviewfrac14 itemampidfrac141067 purishycelli-firmC3B3-convenio-de-defensa-con-chinaampItemid frac14238 accessed 12 September 2012

37 China Military Online lsquoChang Wanquan holds talks with Argentine deputy Defense ministerrsquo 28 November 2011 httpengchinamilcomcnnews-channelschina-militaryshynews2011-1128content_4725893htm accessed 29 November 2011

38 T Wang et lsquoNew SRL station running in San Juan of Argentinarsquo Crustal Dynamics Data Information System nd httpcddisgsfcnasagovlw15docspapersNew20SLR20Station 20Running20in20San20Juan20of20Argentinapdf accessed 9 November 2011

39 Chinese Academy of Sciences lsquoChina Argentina to strengthen cooperation on Antarctic expeditionrsquo 16 August 2010 httpenglishbiccascnNE201008t20100816_57510html accessed 29 November 2011

40 Janie Hulse lsquoChinarsquos Expansion into and US withdrawal from Argentinarsquos telecommunicashytions and space industries and the implications for US national securityrsquo Strategic Studies Institute September 2007 httpwwwstrategicstudiesinstitutearmymilpdffilespub806pdf accessed 7 November 2011

41 Ministry of Science and Technology lsquoChina y la Argentina se reu nen para desarrollar un Centro Binacionalrsquo 2011 httpwwwmincytgovaragendaagenda_detalle phpid_ agendafrac1435 accessed 16 November 2011

42 httpwwwlmneuquencomarnoticias201282avanza-instalacion-de-una-estacion-satel ital-de-china-en-la-provincia_156999 accessed 14 October 2012

43 httpwwwstrategicstudiesinstitutearmymilpubssummarycfmqfrac14 806 accessed 29 November 2011 httpenergyseenewscomnewsargentina-china-sign-nuclear-coop eration-agreement-306141 accessed 3 November 2012

44 For the major reasons that motivated this interest see Lyle Goldstein lsquoChinarsquos Falklands Lessonsrsquo Survival 503 2008 pp 65-66

45 UKNDA Inconvenient Truths Threats Justify Prioritising Defence London UKNDA 2011 p 24

46 La Nacion Buenos Aires lsquoVivir en la Argentina estudiar en Chinarsquo 11 October 2011 http wwwlanacioncomar1413556-vivir-en-la-argentina-estudiar-en-china accessed 9 Novemshyber 2011

47 G M Calderon lsquoInmigracion china en las Americas Comparacion de las experiencias en Canada y Argentinarsquo Revista Argentina de Estudios Canadienses No 2 2008 p 30

48 La Nacion Buenos Aires lsquoChina Una oportunidad histo ricarsquo 26 July 2011 49 Juan Tokatlian lsquoLatin America China and the United States A Hopeful Trianglersquo 2007

Open Democracy httpwwwopendemocracynetdemocracy-protesthopeful_triangle_ 4336jsp accessed 4 November 2011

50 La Nacion Buenos Aires lsquoUna nueva estrategia hacia Chinarsquo 29 August 2011 51 Brantley Womack lsquoBeyond Win-Win Rethinking International Relationships in an Era of

Economic Uncertaintyrsquo Paper presented to the International Conference on the Chinese Models of Development Domestic and Global Aspects Taipei Taiwan September 2011

52 Joseph Tulchin Argentina and the United States A Conflicted Relationship New York Macmillan 1990

53 Russell and Tokatlian lsquoBeyond Orthodoxyrsquo 54 According to the latest report of Latinobaro metro 52 of the Argentines consider Brazil as

the main leader of Latin America while only 2 gives that condition to the United States http wwwlatinobarometroorglatinoLATContenidosjsp accessed 23 November 2011

55 Osvaldo Rosales lsquoLa Republica Popular China y America Latina y el Caribe Hacia una nueva fase en el vınculo econo mico comercialrsquo 2011 ECLAC httpwwweclacorgpubl icacionesxml643666La_Republica_Popular _China_y_America_Latina_y_el_Caribe _ tradepdf accessed 10 November 2011

56 Eric Farnsworth 2011 lsquoThe New Mercantilism Chinarsquos Emerging Role in the Americasrsquo Current History February Available at httpwwwas coaorgarticles2982The_New_shyMercantilism_Chinas_Emerging_Role_in_the_Americas accessed 28 November 2011

Dow

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ded

by [

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02

37 0

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ovem

ber

2014

Journal of Iberian and Latin American Research 267

Appendix 1

Table 1

Argentinean trade with Brazil in millions of dollars 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Exports 6206 4828 4666 5587 6335 8141 10498 13272 11374 14420 Imports 5230 2517 4700 7567 10187 11749 14523 17687 11822 17658 Trade 975 2310 233 21980 23852 23608 24025 24415 2448 23238 balance

Argentinean trade with the United States in millions of dollars 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Exports 2840 2869 3364 3733 4493 4025 4153 5095 3465 3656 Imports 3737 1789 2238 3389 3998 4247 5264 6894 5106 6125 Trade 2897 1080 1126 344 495 2222 21111 21799 21641 22469 balance

Argentinean trade with China in millions of dollars 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Exports 1123 1092 2483 2628 3193 3476 5170 6355 3668 6117 Imports 1066 330 721 1402 2237 3122 5093 7104 4823 7678 Trade 56 762 1762 1227 956 354 77 2 749 2 1155 2 1561 balance

Source INDEC and UNCTAD

Table 2

FDI stock in Argentina by country of origin in millions of dollars (selected countries) 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

USA 16422 7476 7989 10277 11689 12208 13601 13930 14012 14814 of total 238 231 208 182 187 176 175 172 175 168

Brazil 1953 2108 3280 1773 2488 2810 3659 4969 4319 5367 of total 283 651 856 314 397 406 470 614 539 608

China no data no data no data 13 11 45 120 141 123 5500 of total no data no data no data 002 002 006 015 017 015 623

Total 68935 32403 38323 56554 62639 69292 77899 80941 80144 88249

for the years 2001 2002 and 2003 the data for Brazil includes all FDI from South America excluding ChileFrom 2003 onwards the data is exclusively for BrazilSource INDEC and UNCTAD

Table 3

Argentinean trade with the European Union in millions of dollars 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Exports 4698 5309 6079 6209 6844 8010 9901 13173 10278 11026 Imports 4717 2107 2814 4237 4830 5811 7442 9043 6434 7587 Trade 219 3201 3265 1972 2013 2199 2458 4130 3845 3439 balance

FDI from the European Union in Argentina in millions of dollars 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

FDI 38279 18284 21273 33001 36848 40408 45159 45070 44963 47605 of total 5553 5643 5551 5835 5883 5832 5797 5568 5610 5394 Total 68935 32403 38323 56554 62639 69292 77899 80941 80144 88249

Source INDEC and UNCTAD

Dow

nloa

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by [

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erlin

] at

02

37 0

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ovem

ber

2014

  • Abstract
  • The United States and Brazil Losing and Gaining Centrality
  • Relations with China (and Asia) A Historic and Challenging Opportunity
  • Looking Ahead
  • Notes
  • Appendix
Page 4: Implications of the Global and Regional Changes for Argentina's Foreign Relations

Journal of Iberian and Latin American Research 253

century to the present Argentina has responded to each of these developments in a distinct

manner With the United States it has abandoned the strategy of lsquocouplingrsquo and has

implemented a strategy of lsquolimited oppositionrsquo 7 Towards Brazil Argentina has pursued a

strategy of accommodation seeking to gain benefits but also to retain as much autonomy as

possible Finally vis-a-vis China Argentina has practiced a strategy of lsquoreliable engagementrsquo

that has provided clear benefits but which also seems to be exhausting

Relations with the United States Brazil and China are analysed respectively in the two

following sections The focus of our work is placed on the implications of global and

regional changes in the foreign relations of Argentina It is important to note that these

changes do not fall into Gilpinrsquos category of lsquosystemic changesrsquo The changes to which we

refer here belong to a long duration historical cycle that is still in progress and which is

marked by the redistribution of power and wealth from West to East and from North to

South in the context of globalization8 The resultant changes offer unprecedented

opportunities and challenges to most Latin American countries and demand to a large

extent a rethinking of foreign policy its priorities and exercise The paper concludes with

a section in which we try to put into perspective Argentinarsquos relations with the three above

mentioned countries

The United States and Brazil Losing and Gaining Centrality

Argentina-United States relations have experienced significant changes since the

beginning of the twenty-first century The events of 911 in the United States relegated

Argentina to an even less important position from that it had occupied in the George

W Bush administrationrsquos already reduced Latin American agenda Moreover

Washingtonrsquos decision not to support Argentina when the country defaulted on its debt

in late 2001 was read in Buenos Aires and other Latin American capitals as a clear sign

that lsquocouplingrsquo with the United States goes unrewarded and that the time of the

Washington Consensus was coming to an end Most of the Peronists back in government

after the financial crisis found fresh arguments to criticize Washingtonrsquos coldness as well

as the recipes of the IMF and the neoliberal policies pursued by the country in the nineties

From this moment onwards bilateral relations were gradually dominated by two main

trends the loss of US centrality in the foreign policy of Argentina and the growing

indifference of Washington vis-a-vis Buenos Aires

During the first months that followed the crisis Argentina opted for a lsquoselective

rapprochementrsquo with the Unites States rather than merely band wagoning At that time

Washingtonrsquos role was considered central for overcoming the crisis because of its

influence in the multilateral lending institutions Emboldened by the first signs of

economic recovery Eduardo Duhaldersquos transition government (2002 ndash 2003) began to

voice its opposition to some policies of Washington at the end of his short administration

for example to the US military intervention in Iraq The rapid and even startling recovery

from the crisis and the high growth of Argentinarsquos economy in subsequent years

strengthened the idea in Buenos Aires that the country could grow and develop without

Washington and certainly against its economic prescriptions This notion was reinforced

after the March 2005 agreement with private creditors of the debt in default (76 of the

bondholders) and the cancelation in January 2006 of the US$98 billion debt with the IMF

in a single payment using reserves of the Central Bank Thus over a period of around three

years the United States ceased to be seen as an lsquoindispensable nationrsquo for Argentina

The idea that Argentina could do for the most part without strong ties to Washington

had clear ideological components that came from the inner circle of the Nestor Kirchnerrsquos

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254 R Russell and J G Tokatlian

administration (2003 ndash 2007) However it found its greatest support in the material

conditions offered by a global and regional scenario that opened new and extraordinary

opportunities to the country China became a key trading partner and Brazil behaved as the

closest country to Argentina during and in the years following the crisis Meanwhile the

United States did not devote much time to Argentina let alone the wider South America

This fact was much more than the mere repetition of the United States tendency to put

Latin America in a secondary position in its foreign policy concerns It has to be situated in

the context of the long-term process of U S hegemonic decline in South America

especially in the Southern Cone countries

More specifically the low strategic relevance of Argentina for the United States helps

explain the growing indifference of Washington towards the country This fact is not new

but has intensified during this century Argentina does not have a prominent place in any of

the priority issues on the United Statesrsquo Latin American agenda trade migration drugs

terrorism and public safety and energy A second factor that also explains Washingtonrsquos

estrangement from Buenos Aires is a sequence of bilateral conflictive episodes of high-

voltage in which Argentina played or was seen to play the role of the actor less open to

dialogue and more prone to overacting Vocal criticism on the Argentine side first to the

IMF and later to Washingtonrsquos policies past and present became louder as Argentinarsquos

economy recovered The climax came at the Fourth Summit of the Americas held in Mar

del Plata on November 4 and 5 2005 where the then president of Argentina Nestor

Kirchner firmly opposed lsquoneoliberalismrsquo and the creation of a hemispheric free trade area

(FTAA) and accused the United States of having an lsquoanachronistic viewrsquo of the problems

afflicting developing countries Moreover he called on Bush to have a more responsible

leadership in Latin America by ending his support for policies that had lsquonot only led to

misery and poverty but also the fall of democratically elected governmentsrsquo9 Mar del Plata

marked a turn for the worse in bilateral relations and Washington was left with a bitter taste

that would linger until the end of George W Bushrsquos presidency Moreover while the so

called lsquoArgentine modelrsquo heterodox and lsquoneo-developmentalistrsquo in its economic

orientation did not fit into the category of lsquoLatin American radical populismsrsquo it was

viewed by US officials with suspicion and disgust Although Nestor Kirchner never

subscribed to the tenets of the lsquosocialism of the twenty-first centuryrsquo Washington watched

with dissatisfaction the close links established betweenArgentina and Venezuelarsquos Chavez

After the inauguration of Cristina Fernandez de Kirchner to the presidency of

Argentina in December 2007 new conflicts contributed to deepen lsquomutual detachmentrsquo

Barack Obamarsquos arrival in office in January 2008 was considered by Buenos Aires as an

opportunity to open a new dialogue Moreover the financial crisis in the United States

merely reinforced government beliefs and policies on the role of the state in the economy

and on the need to reform the multilateral lending agencies However with its first

domestic and foreign policies the Obama Administration soon showed that the ideological

affinities world views and purposes were less similar to what at first could have been

imagined at the Casa Rosada President Fernandez de Kirchner rapidly moved from initial

lsquoadmirationrsquo to conclude that President Obama lsquohad not fulfilled the expectationsrsquo and that

his Administration lsquoignores the needs of the Southern Conersquo10

Over the years the distancing on global and regional issues became apparent the threat

and the use of force in the Middle East Central Asia and Northern Africa the conception

and practice of the lsquoResponsibility to Protectrsquo the statehood condition of Palestine the level

and scope of protectionism the promotion and enforcement of stronger financial regulations

worldwide the approach vis-a-vis specific countries such as Iran the half-century old

Cuban blockade the debate and reform over crucial aspects of the Inter-American system

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Journal of Iberian and Latin American Research 255

such as the Inter-American Defence Board and the Inter-American Treaty of Reciprocal

assistance the differences in views and attitudes vis-a-vis a sort of lsquoneo-coupismrsquo

(neogolpismo) in the region such as in Venezuela (2002) Honduras (2009) Ecuador (2010) and Paraguay (2012) and the broadening and militarization of the lsquowar on drugsrsquo However

a simultaneous convergence on important world and continental topics has been evident

acting in favour of nuclear non-proliferation avoiding the presence of transnational

terrorism in the area (for example in the Tri-border zone of Argentina Brazil and

Paraguay) supporting the human rights component of the Inter-American system and

participating in humanitarian missions such as the one in Haiti

In brief by the end of the first year of the second mandate of President Fernandez de

Kirchner and after the re-election of President Obama for a second term the bilateral

relationship remained characterized by little presidential dialogue low shared-

expectations outspoken differences and specific cooperation only on issues of common

interest Key coincidences and several major differences have not been institutionalized in

a general framework by which the mixture of consensus and dissent could be managed On

many occasions first and second-level government officials in Washington and Buenos

Aires overreacted to an incident or underplayed an accord In most cases the perception at

the highest level of each government was one of misunderstanding tiredness and

discomfort

Within this context the fact that Argentina will occupy a non-permanent seat on the

UN Security Council in 2013 ndash 2014 where critical issues will be on the agenda (some of

significance for Buenos Aires including the Malvinas-Falkland question as well as the

lsquovulture fundsrsquo suing Argentina in US courts regarding the 2001 debt default) Requiring

Washington to play a positive role may generate a situation that pushes both countries to

at least devise an improved consultative mechanism in order to handle their relationship

with more maturity and realism

Relations between Argentina and Brazil have been marked by the increase in

asymmetries between the two countries in terms of capabilities as well as in international

projection Since the crisis of 2001 Argentina has undergone a gradual process of

economic and self-esteem recovery whereas Brazil has consolidated its position as an

emerging power both regionally and globally These developments together with the loss

of US centrality in South America and Mexicorsquos growing links and interdependence with

North America have dramatically altered the geopolitical landscape in Latin America

particularly in South America

Three distinct phases can be highlighted in the Argentine-Brazilian relationship

since the beginning of the twenty-first century11 The first extends from the crisis of

2001 through 2003 and is characterized by the growing importance given to Brazil by

the elites and public opinion in Argentina While other governments were abandoning

Argentina the Fernando Henrique Cardoso Administration expressed solidarity with

the government led by Eduardo Duhalde during the time of crisis arguing that the

International Monetary Fund could not be insensitive to the serious situation which

afflicted Argentina and said that Brazil continued to trust in its main Mercosur

trading partner Later with Lula already in the Planalto the idea of Brazil as

lsquoalternative development modelrsquo to the one implemented in the 1990s and as the

lsquomain cardrsquo of Argentinarsquos international insertion became dominant in Buenos Aires

Nestor Kirchner took office in May 2003 stating Brazilrsquos importance for Argentina

and emphasized the need to give more weight and density to a common strategic

project However this positive vision of the bilateral relationship was expressed at the

beginning of a phase in which Argentina was leaving behind the crisis With gradual

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256 R Russell and J G Tokatlian

recovery came the revival in Argentina of an ambiguity vis-a-vis Brazil Although

Brazil was seen as a key player and partner it also raised suspicions and doubts

throughout the whole Argentine political spectrum Its status as an emerging power

produced concerns For the Right in Argentina the Lula presidency gave reasons to

refloat the perception of Brazil as an lsquoincorrigiblersquo country The different assessments of

the strategic condition of South America vis-a-vis Latin America also reappeared and with it

fears of a possible Brazilian hegemony in South America The government of Fernando de la

Rua (1999ndash2001) had had a preventive and defensive attitude about the political idea of South

America proposed by Brazil ndash a political and economic geographic area with its own

peculiarities and different from the lsquoLatin America of the Northrsquo The government of Nestor

Kirchner also adopted a reluctant position An eloquent example of this attitudewas President

Kirchnerrsquos decision not to attend the gestation of the South American Community of Nations

meeting (prior to its transformation into the Union of SouthAmericanNations) in 2004 on the

grounds that it was an instrument created by Brazil to project and ensure its own power in

the region

References to Brazil arose in the context of a stagnating Mercosur Repeated promises

to give the bloc a new birth ndash the so called lsquorelanzamientorsquo ndash could not hide that in terms

of its economic significance Mercosur exhibited clear signs of exhaustion Moreover

similar views in both capitals about the lsquodevelopment modelrsquo did not help to give more

oxygen to the integration process The convergence between Kirchner and Lula on the

need to restore the lsquoindustrialistrsquo vision of integration as opposed to the lsquocommercialrsquo

approach of the nineties gave the impression that the two countries were ready to give its

ties a new strategic perspective However the bilateral agenda of lsquoproductiversquo integration

and Brasiliarsquos acceptance of the importance of the lsquore-industrializationrsquo of Argentina were

interpreted in Buenos Aires as a right to establish protectionist measures for Brazilian

exports that threatened the national industry and even more to ignore certain rules This

propensity for defensive policies not only emphasized the lsquofatiguersquo of Mercosur but also

contributed to the low willingness on the part of Brasilia to accept limits to the

autonomous management of its foreign policy Integration never ceased to be a goal for

Brazil but with time acquired a minor role in the priorities of its foreign policy Its

systematic rejection of a surrender of elements of sovereignty and autonomy to the

Mercosur was one of the determinants of the institutional weakness of the bloc Moreover

as Monica Hirst has put it lsquothe importance of the South American economies as a space for

a larger expansion of the Brazilian companies and the statersquos presence as an investor

(Petrobras) and financier (BNDES) [Brazilian Development Bank] became more

important for Brazilian material and strategic interests that the regional integration

process especially the Mercosurrsquo12 In short ambiguous perceptions coexisted in

Argentina with fluctuating bilateral relations The setting was propitious for the

reappearance of anti-Brazil perceptions in Argentina The pro-Brazilian episodic euphoria

of the years of Duhalde (Brazil as a lsquogreat strategic allyrsquo) turned into doubt and criticism in

the second phase which goes from the beginning of 2004 to the end of 2006 Explicitly

and implicitly by both the Right and the Left an ambivalent feeling towards Brazil

unfolded albeit without the pugnacity of the past but nevertheless highlighting the

difficulties of embedding a culture of friendship between the two countries13

As in other debates in Argentina these visions were remnants of perceptions forged in

the seventies and nineties Kirchnerrsquos own ambiguities style and measures in government

did not help to build a more positive image of the role of Brazil for Argentina Several

groups located in the Ministry of Foreign Affairs the business world think-tanks and the

media encouraged the counterbalancing of Brazil in lsquoSouth Americarsquo by means of a

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Journal of Iberian and Latin American Research 257

lsquoLatin-Americanrsquo policy in which the role of Mexico was presented as crucial On the

other hand the vision of Chile as a partner for a more balanced South America and as an

economic model also regained strength in a wide spectrum of the Argentine elites covering

the Right to the centre-Left Chilersquos image was contrasted with that of Brazil The first was

seen essentially as lsquopredictablersquo and lsquoreasonablersquo while the second after the triumph of

Lularsquos Workers Party tended to be presented on the opposite side For some closer

relations with Chile would serve to offset the influence of Brazil in the Southern Cone ndash a

Santiago ndash Buenos Aires axis to limit the Brazilian aspiration to lead the area ndash while

others perceived the lsquoChilean wayrsquo as the best manner for taking a safe distance from

Mercosur which was perceived as an obstacle to establishing a flexible dense and fruitful

relationship with the rest of the world Finally the Left identified the relationship with

Venezuela as a balancing factor for restraining the power of Brazil

The third phase of Argentine ndash Brazilian relations started at the end of 2006 and

extends to the present An interesting twist can be observed in the direction of a more

positive perception of Brazil that clearly puts it in a central place for Argentina Two main

factors explain this change The first and most important is the growing international

relevance and regional weight of Brazil This process has led to the formation of a

widespread perception in Argentina that defines Brazil as lsquoinevitablersquo with a predominant

negative and generally pessimistic bias or as a country that is lsquoindispensablersquo in this case

emphasizing the possibility of building a common future and a strong cooperative

relationship The idea of Brazil as a necessary country is widely accepted but has

variously been accepted with resignation disgust and joy alternatively viewed as an

opportunity or severe challenge The lsquosuccessrsquo of Brazil is often contrasted with the

lsquofailuresrsquo of Argentina and generates different feelings such as pain envy nostalgia and

desire for emulation In any case the growth and rise of Brazil has converted it into a

model for almost everyone The second factor is the growing density of bilateral relations

As an example it is interesting to note that Brazil is already the fourth largest foreign

investor in Argentina after the United States Spain and China In 2010 24 of total

exports (42 industrial) and 82 of the cars manufactured in Argentina were directed to

the Brazilian market and 863492 Brazilian tourists visited the country14 At the same

time the expansion of Brazilian companies in Argentinarsquos productive activity and trade

has been impressive in the last decade

The main issue for the future then is how to live and interact with the lsquoinevitablersquo or

lsquoindispensablersquo country This convergence of perceptions regarding the centrality of Brazil

for Argentina only goes so far There is no agreement on the political economic and

strategic interests that should constitute the relationship with Brazil and consequently

about the best ways to put them into practice The transition from an entrenched culture of

rivalry to an incipient culture of friendship has lasted more than a quarter of a century

providing promising dividends for both nations and offering a good platform from which

to renegotiate the growing bilateral ties The world and the region and the national

situation of the two countries especially concerning the distribution of attributes of

economic power are now very different to the 1980s when the two countries took the first

steps to build a positive bilateral relationship The double condition of the Argentine ndash

Brazilian relationship that is its increasingly close and uneven character suggests that

there will be a complex combination of convergence and divergence between the two

nations Argentina and Brazil never were Pakistan and India in terms of antagonism and

sought in the past to jointly become an equivalent to the Franco ndash German axis for the

integration of South America an aspiration that today is unsustainable Circumstances

have changed and the condition of lsquoasymmetric interdependencersquo is recognized and

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ber

2014

258 R Russell and J G Tokatlian

accepted in Argentina although not without the suspicions that characterize the attitudes

of the weaker party in a bilateral relationship In this context the main challenge for

Brasilia and Buenos Aires is to forge a realistic and positive lsquonew dealrsquo that contemplates

with its own specificity the bilateral relationship as well as Mercosur

In the end the above-mentioned three phases show the existence of both a changing

and intricate relationship If the theory of asymmetry is taken into consideration the first

move towards re-negotiating an unbalanced relationship should be initiated to a large

extent by the less powerful party In that sense it is yet unclear what the Argentine elites

(civilian and military economic and intellectual state-based and non-governmental) want

from relations with the continent (including the United States) the Spanish-speaking

region South America and finally Brazil Historically it has been quite difficult for

Argentines to have simultaneous positive relations with Washington and Brasilia In the

last two decades different opinions (sometimes personal more than collective) between

the lsquoLatin-Americanistsrsquo and the lsquoSouth-Americanistsrsquo favouring opposite strategic

options have been vocally expressed Currently several other countries in the area have

been increasing their leverage especially those facing the Pacific This phenomenon does

not go unnoticed by Argentine elites and is another source of domestic debate In this

dynamic and changing regional context Argentina has not been able to clearly establish

the goals and ambitions to guide its foreign policy towards the region and Brazil in

particular The response to this situation should be sought in essence in domestic politics

Relations with China (and Asia) A Historic and Challenging Opportunity

Argentine ndash Chinese links should be placed in the larger context of China ndashLatin America

relations15 From a Latin American perspective Chinarsquos growing presence in the region

has been seen at least in the first decade of the twenty-first century as a promising trend

Chinarsquos ties with Latin America from the 1950s to the 1970s were marginal focused

primarily on cultural diplomacy driven by ideological motives and based on

revolutionary rhetoric This diplomatic strategy relied on the dividends of destabilization

was accompanied by anti-US slogans and was geared toward strengthening pro-Chinese

(and anti-Soviet) political parties and movements Chinarsquos international behaviour during

that period was that of a revisionist actor who sought to change the rules of the game

through aggressive means

In contrast Beijingrsquos approach to the region since the 1990s has involved an active

economic diplomacy characterized by pragmatism conciliation and stability Chinarsquos key

goal and main challenge has been to deepen its relations with the countries of Latin America

without irritating Washington Diplomatically China has proceeded in a judicious fashion

which explains in part why regional forces did not emerge to veto a policy of prudent and

consistent engagement toward China In addition Chinarsquos external diplomatic model has

been seductive to Latin America especially during the two administrations of George

W Bush in the United States multipolarism as opposed to unipolarism multilateralism as

opposed to unilateralism non-interference as opposed to interventionism soft power as

opposed to hard power pragmatism as opposed to ideologisation collaboration as opposed

to domination and persuasion as opposed to coercion All have been attractive notions in

Latin America Chinarsquos contemporary approach coincides with strong Latin American

traditions and aspirations and has become more captivating by virtue of the mishandling

disregard and thoughtlessness of US foreign policy towards the region

Nothing indicates that Latin America is geared towards accepting a paternalistic

externally-induced security dilemma with China and the region does not feel insecure visshy

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2014

Journal of Iberian and Latin American Research 259

a-vis Beijing despite certain ideologically-driven pressure groups in Washington

Moreover the Sino ndash Latin American ndash US triangular relationship has not engendered

major tensions or unmanageable challenges16 There is also nothing to suggest from a

regional viewpoint that Latin America ndash China ndash United States relations are destined to an

apocalyptic geopolitics approach based on an overblown fear of an alleged Chinese

takeover of the region China is not the Soviet Union post 911 is not a rehearsal of the

Cold War Washington is no longer at the pinnacle of world power and Latin America has

not collapsed after the Western economic and financial crisis began in 2008 There is also

no indication that Chinarsquos intention is to challenge the United States in the Western

Hemisphere In fact the Chinese government has actively sought to convince the United

States and the rest of the world that its intentions are benign thus the self-portrayal of a

peaceful rise

Chinarsquos behaviour in Latin America at the outset of the twenty-first century has been

far from that of a revisionist power On the one hand Beijingrsquos strategy has combined

necessity with opportunity and has been put into practice cautiously and diligently

curtailing the likelihood that the region will develop or adopt a policy aimed at rolling

back Chinarsquos presence On the other hand Latin Americarsquos relationship with Beijing is

more dependent on economic facts than political conceptions As there is no major

ideological concern in most countries about dealing with China the crucial element is the

material effect of Sino ndash Latin American linkages the level of dependency of the region

vis-a-vis China the degree of de-industrialization of the area derived from bilateral trade

and the ecological consequences of Chinese investment in Latin America17

This broader framework is essential to understand the dynamics of Argentinarsquos

relations with China in the larger context of Argentinendash Asian links Over the past two

decades the (re)emergence of China and the ascent of Asia have been a blessing for

Argentina Rising demand and higher prices for commodities have made it possible for

Argentina to elevate and diversify its trade flows with the East Since the 1990s and

despite the discernible differences in economic and foreign policies between Carlos

Menem and the Kirchners Argentina has developed a new pattern of production that has

led notwithstanding the crisis of 2001 to a reorganization of the economic base of the

country As noted by Pablo Gerchunoff lsquoIt is not just about the speed of exports there is

also a significant diversification traditional agriculture new agriculture industry energy

and mining concurred to modify the national economic landscapersquo18 In that context and

according to President Nestor Kirchner it was crucial lsquothrough China to search in Asia the

leverage to re-industrialize Argentinarsquo Economy not politics has been the driving force

to improve and extend Argentine relations with the East19

For the first time in more than seven decades Argentina has met a world that eagerly

requires what it produces The key driver of this demand is located in China but covers a

wide range of countries At present China is Argentinarsquos second largest trading partner

both in terms of the origin of imports and recipient of exports ndash in both dimensions after

Brazil and before the United States (See Table 1) Argentina meanwhile ranks third in the

list of the 15 major suppliers of agricultural products which supplied 90 per cent of

Chinese imports in 2010 United States (244) Brazil (136) and Argentina (73)

Other major suppliers were the European Union (6) Australia (5) and Malaysia (5)

By 2001 Argentine exports to China surpassed the US$1 billion barrier to hit US$1123

billion and imports totalled US$1066 billion Thus there was a small surplus of US$56

million in favour of Argentina By 2010 the commercial exchange was worth US$13795

billion totalling US$6117 billion in Argentine exports and US$7678 billion in Chinese

exports The result was a trade balance of US$1561 billion in Chinarsquos favour20 In the

Dow

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ber

2014

260 R Russell and J G Tokatlian

period January ndashSeptember 2011 the surplus in favour of China grew While Argentine

exports amounted to US$4746 billion Chinese exports came to US$7569 billion21

India is Argentinarsquos main Asian trading partner after China22 Other important

countries are Indonesia South Korea Malaysia Vietnam and Thailand23 By 2010 when

China implemented barriers to Argentine soybean oil in retaliation for local action that

prevented the entry of Chinese products into the country Argentina reoriented its soybean

exports to India which bought 14 million tons of soybean oil (corresponding to US$12

billion dollars) In September 2011 Indiarsquos ambassador in Argentina said his country

would increase demand for soybean oil over the next ten years from the current 8 million

to 15 million tons representing a significant additional opportunity for Argentine

producers and exporters24

Indeed ties with Asia are not limited to trade Again the paradigmatic case of this

new relationship is China which in recent years has also emerged as an increasingly

important financial actor During 2009 at a high point of the US-originated financial

crisis China and Argentina agreed to swap US$10 billion worth of their currencies in

order to enable Argentina to avoid using dollars in trade between both countries an

agreement that was the first of this sort between China and a South American country25

Beijing simultaneously accelerated its investment in agriculture mining energy and

banking and has become the third largest investor in the country (See Table 2)26 In

addition there is strong Chinese interest for participation in infrastructure development

projects in sectors such as railways roads ports and telecommunications The largest

food company in China Heilonjiang Beida-Huang signed an October 2010 cooperation

agreement with the province of Rıo Negro27 which provides China with twenty-year

leases on provincial lands (20000 hectares at an early stage that may eventually extend

to up to 320000 hectares)28 In return the Chinese company is committed to

undertaking major irrigation and infrastructure works as part of a ten-year investment of

US$15 billion dollars29 Different actors from Argentina are also opening trade offices

in Chinese cities and several twin cities and sister provinces have signed different 30agreements

In the oil sector the China National Offshore Oil Corporation (CNOOC) acquired 50

per cent of Bridas Corporation and Sinopec holds 100 per cent of Argentine assets in

Occidental In addition China controls 50 per cent of the Cerro Dragon field and will

handle major reserves for 40 years in the province of Santa Cruz To sum up Beijingrsquos

growing interest in Argentina has meant that the country is according to Levi J Jordan

from the Americas Society lsquoreceiving almost half of Chinarsquos investment in South America

over the past two yearsrsquo31 In that context the growth of Chinarsquos state corporations is

impressive32 Agreements have also been made in the field of defence the most prominent

is the signing of the Memorandum of Understanding for Strengthening Exchanges and

Cooperation in Defense of 16 May 2007 whereby both countries have committed to

maintain contacts to discuss global and regional security issues to cooperate on military

equipment and logistics and to establish a Defence Joint Commission It is worth

mentioning that officers from Argentina together with military from Chile and Colombia

frequently (more often than counterparts from Cuba and Venezuela) have attended courses

on grand strategy at Beijingrsquos elite national defence university PLANDU33 Even though

Argentina is not a significant South American buyer of military equipment34 has a very

low annual defence budget and that China is not the major supplier of arms to the region

(as it is the case of the United States Russia and the European Union) it has lately

considered the acquisition of Chinese Z-11 helicopters35 Finally after a July 2012 visit to

China by Argentine Defence Minister Arturo Puricelli both countries agreed that

Dow

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2014

Journal of Iberian and Latin American Research 261

Argentina will construct a prototype of that helicopter by 201336 In general the level of

bilateral military dialogue is highly positive37

In key scientific and technological areas there has been an on-going improvement of

relations For example a Satellite Laser Raging (SLR) system designed and made in China

was installed in the Observatory of San Juan University38 Both countries plan to conduct

collaborative activities for Antarctic expedition39 There are many contacts and joint

initiatives in the areas of telecommunications and space40 The two countries are also

interested in creating a Bilateral Centre on Science and Technology for Food41

In addition China will install a satellite station in the province of Neuquen42 while

incrementing its presence in the telecommunications sector and establishing cooperation

ties in the nuclear field43

Argentina and China share important interests in their diplomatic agenda with regards

to the defence of the principle of lsquoterritorial integrityrsquo China consistently supports the

Argentine claim of sovereignty over the MalvinasFalklands while Argentina defends the

policy of lsquoone Chinarsquo which implies the non-recognition of the independence of Taiwan

and Tibet The issue of the MalvinasFalklands Islands has been surfacing for two reasons

On the one hand as Lyle Goldstein has remarked lsquoChinese defence analysts take such

intense interest in the Falkland Warrsquo due to the fact that according to Chinese government

officials and experts there are certain similarities between the Malvinas and Taiwan44 As

Taiwan is a vital issue for Beijing the understanding of the 1982 war in the South Atlantic

is extremely relevant On the other hand the potential closeness of China and Argentina

may provoke in the future a vulnerable situation with regards to the islands that could

affect British defence policy45 In times of a major economic crisis in Europe and with

diminishing possibilities of sustaining high defence budgets retired military officers from

Great Britain overemphasize Londonrsquos potential weakness in the South Atlantic

With respect to issues on the global agenda the two countries agree at the level of the

G-20 on the need for greater participation of emerging nations in international financial

organizations as well as the need to implement measures for the avoidance of financial

speculation that causes volatility in the prices of commodities Both countries have been

supporting peacekeeping operations and they both participate militarily in the UN Mission

in Haiti At the International Atomic Energy Agency Beijing and Buenos Aires have been

active in the promotion of non-proliferation

It is important also to mention a relatively new phenomenon in the relation between

Beijing and Buenos Aires namely Chinese immigration to Argentina There are

approximately 120000 Chinese and Chinese-descendants in Argentina mainly in Buenos

Aires46 Their point of origin is mostly Taiwan and Fujian and to a lesser extent Hong

Kong Even though there are no good estimates or different in-depth studies lsquoChinese

immigration to Argentina is assumed to be largely of illegal naturersquo with lsquoremittances an

important flow of capitalrsquo and Argentina being lsquoan intermediate stoprsquo for approximately

half of the Chinese migrants before seeking entry into the United States (mainly) or the

European Union47

To sum up the capabilities willingness and needs of both sides make the relationship

between Argentina and China (and Asia) complementary The East needs raw materials

(energy food and mining) and Argentina needs investments and infrastructure Of course

a link of this nature presents opportunities but also brings risks It has become fashionable

in Argentina to compare the current situation with the golden years of the lsquospecial

relationshiprsquo with Great Britain (and Europe) that was undoubtedly the engine of the great

Argentine take off between 1880 and 1914 It is also noted that the new relationship with

Asia offers great benefits to the neighbouring countries and therefore does not threaten the

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262 R Russell and J G Tokatlian

harmony existing in the sub-region48 While recognizing the historic opportunity offered

to Argentina by the (re)emergence of China and the advancement of several Asian nations

others emphasize the risks especially those coming from China

Within that context it is relevant to mention that the highly optimistic somehow-naive

phase of Chinese ndash Latin American relations is experiencing changes including in

Argentina ndash China relations Most countries in the region and among them Argentina are

slowly moving from a strategy of lsquoreliable engagementrsquo49 to a more mixed strategy based

on a prudent approach that combines strong commercial ties and active damage-control

policies50 Latin American countries are well aware of the importance of key economic

issues and the sensitive security questions that characterize the regionrsquos relations with

China Concerns about de-industrialization via commodity-based export growth (affecting

basically South America) the effect of global lsquocurrency warsrsquo on the region (affecting all

of Latin America) and the impact of a decisive push for rural production within China

(affecting mainly Mexico and Central America) are extremely critical issues from North to

South America

On a broader outlook the fact that the global system is witnessing a period of

uncertainty is generating a new examination of Chinarsquos lsquowin-winrsquo diplomacy51 This is a

time of difficulties that places limits on Beijingrsquos global and regional strategies Not

surprisingly Argentina as well as other countries in Latin America is rethinking its ties

with China under a more nuanced viewpoint The advantages and dividends of more

commercial and financial links with China are superseded by new productive challenges

(for example excessive emphasis on commodities for export) at home and sensible

differences abroad (for example in the case of human rights) Interests and values are now

inextricably intertwined in Argentine ndash Chinese diplomacy In this context the deployment

of a more sophisticated policy vis-a-vis Beijing seems inevitable Necessity more than

willingness is pressing Buenos Aires to design a broader Asian strategy where China will

be a centrepiece but not the only counterpart politically and materially for the country

Looking Ahead

Argentinarsquos foreign policy developed historically from 1880 until the early twenty-first

century around three areas Europe the United States and Latin America especially the

Southern Cone countries Relations with the socialist world particularly with the Soviet

Union for political and commercial reasons were also important in the second half of the

twentieth century but never reached the scale of the other three axes In the decade since

2000 a fourth axis has been added to this traditional pattern with extraordinary strength

and projection the Asia Pacific region dominated by China

Relations with Europe remain important since there are shared interests and values and

a long history of mutual interaction In addition Argentina continues to need European

investments and technology transfers and the EU is still an important trading partner (See

Table 3) But Europe like Japan and the United States is a market in which exports have

shown in the last decade ceilings that are difficult to overcome The most dynamic and

consolidated markets for Argentina are in Latin America and Asia There are also other

developing markets that are growing at a faster pace than the rest of the world and offer

new opportunities for Argentine exports (Australia Canada Russia South Africa and

Turkey) In the next years Europe will focus its attention on domestic issues and other

areas of the world It is unlikely that any significant progress in the relations with

Argentina and Mercosur could be made in the short run A longer-term view suggests that

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2014

Journal of Iberian and Latin American Research 263

Europe will increasingly lose its relative importance for Argentina and that its historically

privileged position in the countryrsquos foreign relations will be a thing of the past

Argentinarsquos relations with the United States have never been easy Joseph Tulchin

summarizes its nature in the title of his well-known book Argentina and the United States A Conflicted Relationship52 The strategy of lsquocouplingrsquo implemented during the Menem

years was a pragmatic adaptation to the world of the immediate post-Cold War and was

buried as a strategic option for Argentina with the 2001 crisis In the decade of 2000 the

Kirchners went back to the traditional historical pattern that we have called lsquolimited

oppositionrsquo53 This pattern which combines collaboration and disagreement deference

and resistance will continue to guide Argentinarsquos foreign policy toward Washington but

in a framework in which Buenos Airesrsquos concerns about restraining the United States

preponderance and power will tend to decrease Present conditions offer a great lsquoobjectiversquo

opportunity for the development of new areas of selective collaboration between the two

countries at the bilateral and regional levels A new era of relations with the United States

seems to be beginning for the Southern Cone one that is less unequal and perhaps more

cooperative The key challenge for Argentina is coping with a new reality of diminishing

influence of Washington in the sub-region Most of the time power erosion produces two

alternative behaviours adaptation or denial At least for the time being the relative decline

of US hegemony in South America is showing signs of a lsquosoft landingrsquo If this scenario

prevails then Argentina may manage its bilateral relation with the United States in a more

constructive way

In the case of Brazil it seems that we are entering a second long cycle of convergent

views about the place of this country in Argentinarsquos foreign policy54 This cycle may be

compared and opposed to another long period of convergent visions that characterized the

dominant form in which the neighbour country was perceived by the Argentine elites

during most of the twentieth century Today Brazil is defined as a strategic partner while

in the past until the return of both countries to democracy it was seen as a rival As we

have already mentioned the main challenge for Argentina is how to build this strategic

partnership within a framework of growing asymmetry

The link with Argentina although very important does not have today the same value

for Brazil as in the second half of the eighties By contrast the relationship with Brazil is

increasingly relevant for Argentinarsquos foreign relations and one that presents a significant

challenge In the past the relative symmetry between both countries was a constant source

of suspicion and conflict In the future the condition of asymmetric interdependence as a

structural feature of the relationship will not allow for competition but also is no

guarantee of friendship or cooperation Rather it can become a new source of suspicion

distrust and differences Argentina and Brazil will have to learn to live together in this new

reality and develop a broader framework of mutual understanding to manage the major

density of bilateral links and the global issues of common interests The greatest effort

must come from Argentina because it is the country that has a higher interest in the

relationship and more to gain

Finally the emergence of Asia is offering Argentina a unique opportunity for a

dynamic and successful international integration Its most recent economic dynamism is a

direct result of the increased demand from China and other Asian countries for food and

raw materials However Argentinarsquos exports to Asia are highly concentrated in the

soybean complex and to a much smaller extent in a small group of primary and natural

resource intensive products According to the latest ECLAC report five major products

accounted for 92 of total exports from Argentina to China during the years 2007 ndash 2009

(soybean 531 soybean oil 265 crude oil 747 other cattle 248 and meat and

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264 R Russell and J G Tokatlian

poultry offal 233)55 Moreover the trade surplus with China has tended to evaporate

after several years of significant positive balances

This situation raises many questions about the Argentine specialization pattern ndash

beyond issues related to trade with China ndash and the need to reduce an excessive

dependence on the export of commodities Nevertheless as the benefits of trade with

China have been so high and have also enabled Argentina to successfully face and resist

the financial crises in the centres the propensity to do nothing is great As Eric Farnsworth

recently observed lsquoWhen nations are able to sell as much as they can produce of any

particular product the thinking is generally to continue doing so and reap the rewards

When economies are growing there is little political imperative or incentive for reformrsquo56

In consequence a relevant question surrounding this type of relationship is how to avoid

the temptation to inertia The tendency towards passive repetition is appealing The China

lsquochallengersquo in the early twenty-first century for Argentina is how to think and act

differently from what had been the case of Argentine ndash British relations at the beginning of

the twentieth century The framing of a different link with Beijing as well as the positive

handling of an increasingly complex multifaceted multilevel relationship with Brazil

seem to be the major challenges ahead for Argentinarsquos foreign relations

Notes 1 Roberto Russell and Juan G Tokatlian El lugar de Brasil en la polıtica exterior argentina

Buenos Aires Fondo de Cultura Econo mica 2003 pp 45 ndash 59 2 We use the concept lsquosystemic changesrsquo in the same sense as Robert Gilpin See his book War

and Change in World Politics Cambridge Cambridge University Press 1981 pp 42ndash 43 3 For an interesting analysis of these debates see Jose Paradiso Debates y trayectoria de la

polıtica exterior argentina Buenos Aires Grupo Editor Latinoamericano 1993 4 On the concept lsquoasymmetryrsquo and its implications for bilateral relations see Brantley Womack

lsquoAsymmetry and Systemic Misperception China Vietnam and Cambodia during the 1970rsquosrsquo Journal of Strategic Studies 262 June 2003 pp 92ndash 119

5 On structural and relational power see Susan Strange States and Markets An Introduction to International Political Economy London Pinter 1988 pp 25ndash9

6 David C Kang lsquoThe theoretical roots of hierarchy in international relationsrsquo Australian Journal of International Affairs 583 September 2004 p 339

7 Roberto Russell and Juan G Tokatlian lsquoBeyond Orthodoxy Asserting Latin Americarsquos New Strategic Options Toward the United Statesrsquo Latin America Politics and Society 533 Winter 2011 pp 129 ndash 134

8 Eric Hobsbawm lsquoDespues del siglo XX un mundo en transicionrsquo in Ricardo Lagos (ed) America Latina iquestintegracion o fragmentacion Buenos Aires Edhasa 2008 pp 29ndash 47

9 Remarks by the President of the Argentine Republic Nestor Kirchner at the inauguration of the IV Summit of the Americas Mar del Plata httpwwwsummit-ameicasorgDocuments 20del20presidente20de20RepC3BAblica20Argentinapdf

10 La Nacion (Buenos Aires) lsquoCristina Kirchner critico a Obama con duros terminosrsquo 26 February 2010 Available at httpwwwlanacioncomar1237368-cristina-kirchner-criticoshya-obama-con-duros-terminos accessed 17 November 2011

11 For more in depth analysis of the bilateral relations see Russell and Tokatlian El lugar de Brasil pp 45ndash59 and Roberto Russell and Juan G Tokatlian lsquoPercepcoes argentinas sobre o Brasil ambivalencias e expectativasrsquo Polıtica Externa 202 September 2011 pp 43ndash 56

12 Monica Hirst lsquoLa polıtica sudamericana de Brasil entre el peso de las asimetrıas y la incidencia de nuevas coyunturasrsquo in F Calderon (ed) Escenarios polıticos en America Latina Conceptos metodos y Observatorio Regional Cuadernos de Gobernabilidad Democratica 2 Buenos Aires PNUD Siglo XXI 2008 p 257

13 We use the concept of friendship following Alexander Wendt Social Theory of International Politics Cambridge Cambridge UP 1999 pp 297ndash 308

14 La Nacion Economıa y Negocios Buenos Aires lsquoBrasil en la vida cotidiana argentinarsquo 22 May 2011 p 1

Dow

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2014

Journal of Iberian and Latin American Research 265

15 On China ndash Latin America relations at the beginning of the XXI Century see Juan G Tokatlian lsquoA view from Latin Americarsquo in R Roett and G Paz (eds) Chinarsquos Expansion into the Western Hemisphere Implications for Latin America and the United States Washington DC Brookings Institution Press 2008

16 According toMark P Sullivan a specialist on Latin American affairs at theUS Congressional Research Service lsquoThe balance of opinion toward China and the United States in Latin America tend to be roughly comparable according to a (2007) Pew study Two exceptions are Argentina where China is viewed much more favorably than the United States and in Mexico where the United States is viewed much more favorably than Chinarsquo See Thomas Lum (ed) lsquoComparing Global Influence China and US Diplomacy Foreign Aid Trade and Investment in the Developing Worldrsquo in CRS Report to Congress August 15 2008

17 Kevin Gallagher lsquoLatin Americarsquos China challengersquo 2011 Policy Innovations httpwwwase tuftsedugdaePubsrpGallagher_PolicyInnovationsJan11pdf accessed 18 November 2011

18 Pablo Gerchunoff 2010 lsquoCausas y azares en mas de un siglo de historia econo mica argentinarsquo in R Russell (ed) Argentina 1910ndash2010 Balance de un siglo Buenos Aires Taurus p 152

19 See the complete quote in Sergio Cesarin lsquoChina y Argentina Enfoques y recomendaciones para potenciar la relacion bilateralrsquo Serie Aportes 2010 httplibraryfesdepdf-filesbueros argentinien07560pdf accessed 28 November 2011

20 Based on INDEC 2011 and Comercio Exterior Argentino 2010 httpwwwindecgovar accessed 13 November 2011

21 Camara de Exportadores de la Republica Argentina En Contcto China No 43 November 2011 p 16

22 In October 2009 President Cristina Fernandez de Kirchner visited India It was her first trip to an Asian country after her inauguration in December 2007 and it was the first visit of an Argentine president to India since 1994

23 It is important to mention the cases of Indonesia and Vietnam for two reasons the growth of trade in the last decade and the fact Argentine exports to these two countries are mainly nonshytraditional commodities For example exports to Indonesia jumped fromUS$43million in 2001 to US$852 million in 2010 while exports to Vietnam grew from US$60 million in 2001 to US $654 million in 2010 Cların iEco Buenos Aires lsquoArgentina en mas puertosrsquo 28 August 2011

24 La Nacion Economıa y Negocios Buenos Aires lsquoLa soja argentina ahora apunta a la Indiarsquo 15 September 2011 p 3

25 China Daily lsquoArgentina China sign tentative swap dealrsquo 31 March 2009 httpwww chinadailycomcnchina2009-0331content_7635007htm accessed 11 November 2011

26 Argenpress (Buenos Aires) lsquoInversiones chinas en la Argentina Claves del nuevo escenario energeticorsquo 14 June 2011 httpwwwargenpressinfo201106inversiones-chinas-enshyargentina-claveshtml accessed 19 November 2011

27 See text of the agreement at httpwwwgrrorgarrionegro-chinaacuerdo-saiz-chinapdf accessed 26 Nov 2011 and El Cronista Buenos Aires lsquoChina invierte 1500 millones en Rıo Negro para asegurarse alimentosrsquo 9 June 2011 httpwwwcronistacomnegocios China-invierte-us-1500-millones-en-Rio-Negro-para-asegurarse-alimentos-20110609-0033 html accessed 19 November 2011

28 On other actual and potential Chinese investments in Argentine provinces see Camara Argentino China Negocios con China 2011 httpwwwargenchinaorgarticulos_2010 NegociosConChinapdf accessed 14 November 2011 and FUNDAMIN lsquoChina invierte en las 23 provincias argentinasrsquo httpfundamincomaresinfo36-exportaciones-e-importaciones 299-china-invierte-en-las-23-provincias-argentinashtml accessed 19 November 2011

29 httpwwwnoalaminaorgmineria-informacion-generalgeneralargentina-china-recreacionshyde-la-vieja-qrelacion-especialq-con-gran-bretana accessed 20 January 2012

30 lsquoLas relaciones entre China y Argentinarsquo httpespanolcricn1161201211281s264119 htm accessed 17 November 2011

31 lsquoRailway rapprochement China invests in Argentinarsquo 2010 httpwwwas-coaorgarticles 2528Railway_Rapprochement_China_Invests_in_Argentina accessed 17 Nov 2011

32 Silvia Simonit lsquoLas empresas chinas en Argentinarsquo Chinese Studies Working Paper Series (Universitat Pompeu Fabra) No 1 2011

33 Loro Horta lsquoIn Uncle Samrsquos Backyard Chinarsquos Military Influence in Latin Americarsquo Military Review September-October 2008 p 48

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ber

2014

266 R Russell and J G Tokatlian

34 As are the cases of Brazil Chile Colombia and Venezuela 35 Seguridad y Defensa lsquoEl Ejercito Negocia con China la compra de helico pterosrsquo 10 October

2010 httpwwwseguridadydefensacomarnoticiasejercito-negocia-con-china-la-comprashyde-helicopteros-25059html accessed 10 November 2011

36 httpwwwelmetroonlinecomarindexphpoption frac14com_k2ampviewfrac14 itemampidfrac141067 purishycelli-firmC3B3-convenio-de-defensa-con-chinaampItemid frac14238 accessed 12 September 2012

37 China Military Online lsquoChang Wanquan holds talks with Argentine deputy Defense ministerrsquo 28 November 2011 httpengchinamilcomcnnews-channelschina-militaryshynews2011-1128content_4725893htm accessed 29 November 2011

38 T Wang et lsquoNew SRL station running in San Juan of Argentinarsquo Crustal Dynamics Data Information System nd httpcddisgsfcnasagovlw15docspapersNew20SLR20Station 20Running20in20San20Juan20of20Argentinapdf accessed 9 November 2011

39 Chinese Academy of Sciences lsquoChina Argentina to strengthen cooperation on Antarctic expeditionrsquo 16 August 2010 httpenglishbiccascnNE201008t20100816_57510html accessed 29 November 2011

40 Janie Hulse lsquoChinarsquos Expansion into and US withdrawal from Argentinarsquos telecommunicashytions and space industries and the implications for US national securityrsquo Strategic Studies Institute September 2007 httpwwwstrategicstudiesinstitutearmymilpdffilespub806pdf accessed 7 November 2011

41 Ministry of Science and Technology lsquoChina y la Argentina se reu nen para desarrollar un Centro Binacionalrsquo 2011 httpwwwmincytgovaragendaagenda_detalle phpid_ agendafrac1435 accessed 16 November 2011

42 httpwwwlmneuquencomarnoticias201282avanza-instalacion-de-una-estacion-satel ital-de-china-en-la-provincia_156999 accessed 14 October 2012

43 httpwwwstrategicstudiesinstitutearmymilpubssummarycfmqfrac14 806 accessed 29 November 2011 httpenergyseenewscomnewsargentina-china-sign-nuclear-coop eration-agreement-306141 accessed 3 November 2012

44 For the major reasons that motivated this interest see Lyle Goldstein lsquoChinarsquos Falklands Lessonsrsquo Survival 503 2008 pp 65-66

45 UKNDA Inconvenient Truths Threats Justify Prioritising Defence London UKNDA 2011 p 24

46 La Nacion Buenos Aires lsquoVivir en la Argentina estudiar en Chinarsquo 11 October 2011 http wwwlanacioncomar1413556-vivir-en-la-argentina-estudiar-en-china accessed 9 Novemshyber 2011

47 G M Calderon lsquoInmigracion china en las Americas Comparacion de las experiencias en Canada y Argentinarsquo Revista Argentina de Estudios Canadienses No 2 2008 p 30

48 La Nacion Buenos Aires lsquoChina Una oportunidad histo ricarsquo 26 July 2011 49 Juan Tokatlian lsquoLatin America China and the United States A Hopeful Trianglersquo 2007

Open Democracy httpwwwopendemocracynetdemocracy-protesthopeful_triangle_ 4336jsp accessed 4 November 2011

50 La Nacion Buenos Aires lsquoUna nueva estrategia hacia Chinarsquo 29 August 2011 51 Brantley Womack lsquoBeyond Win-Win Rethinking International Relationships in an Era of

Economic Uncertaintyrsquo Paper presented to the International Conference on the Chinese Models of Development Domestic and Global Aspects Taipei Taiwan September 2011

52 Joseph Tulchin Argentina and the United States A Conflicted Relationship New York Macmillan 1990

53 Russell and Tokatlian lsquoBeyond Orthodoxyrsquo 54 According to the latest report of Latinobaro metro 52 of the Argentines consider Brazil as

the main leader of Latin America while only 2 gives that condition to the United States http wwwlatinobarometroorglatinoLATContenidosjsp accessed 23 November 2011

55 Osvaldo Rosales lsquoLa Republica Popular China y America Latina y el Caribe Hacia una nueva fase en el vınculo econo mico comercialrsquo 2011 ECLAC httpwwweclacorgpubl icacionesxml643666La_Republica_Popular _China_y_America_Latina_y_el_Caribe _ tradepdf accessed 10 November 2011

56 Eric Farnsworth 2011 lsquoThe New Mercantilism Chinarsquos Emerging Role in the Americasrsquo Current History February Available at httpwwwas coaorgarticles2982The_New_shyMercantilism_Chinas_Emerging_Role_in_the_Americas accessed 28 November 2011

Dow

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ovem

ber

2014

Journal of Iberian and Latin American Research 267

Appendix 1

Table 1

Argentinean trade with Brazil in millions of dollars 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Exports 6206 4828 4666 5587 6335 8141 10498 13272 11374 14420 Imports 5230 2517 4700 7567 10187 11749 14523 17687 11822 17658 Trade 975 2310 233 21980 23852 23608 24025 24415 2448 23238 balance

Argentinean trade with the United States in millions of dollars 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Exports 2840 2869 3364 3733 4493 4025 4153 5095 3465 3656 Imports 3737 1789 2238 3389 3998 4247 5264 6894 5106 6125 Trade 2897 1080 1126 344 495 2222 21111 21799 21641 22469 balance

Argentinean trade with China in millions of dollars 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Exports 1123 1092 2483 2628 3193 3476 5170 6355 3668 6117 Imports 1066 330 721 1402 2237 3122 5093 7104 4823 7678 Trade 56 762 1762 1227 956 354 77 2 749 2 1155 2 1561 balance

Source INDEC and UNCTAD

Table 2

FDI stock in Argentina by country of origin in millions of dollars (selected countries) 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

USA 16422 7476 7989 10277 11689 12208 13601 13930 14012 14814 of total 238 231 208 182 187 176 175 172 175 168

Brazil 1953 2108 3280 1773 2488 2810 3659 4969 4319 5367 of total 283 651 856 314 397 406 470 614 539 608

China no data no data no data 13 11 45 120 141 123 5500 of total no data no data no data 002 002 006 015 017 015 623

Total 68935 32403 38323 56554 62639 69292 77899 80941 80144 88249

for the years 2001 2002 and 2003 the data for Brazil includes all FDI from South America excluding ChileFrom 2003 onwards the data is exclusively for BrazilSource INDEC and UNCTAD

Table 3

Argentinean trade with the European Union in millions of dollars 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Exports 4698 5309 6079 6209 6844 8010 9901 13173 10278 11026 Imports 4717 2107 2814 4237 4830 5811 7442 9043 6434 7587 Trade 219 3201 3265 1972 2013 2199 2458 4130 3845 3439 balance

FDI from the European Union in Argentina in millions of dollars 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

FDI 38279 18284 21273 33001 36848 40408 45159 45070 44963 47605 of total 5553 5643 5551 5835 5883 5832 5797 5568 5610 5394 Total 68935 32403 38323 56554 62639 69292 77899 80941 80144 88249

Source INDEC and UNCTAD

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ber

2014

  • Abstract
  • The United States and Brazil Losing and Gaining Centrality
  • Relations with China (and Asia) A Historic and Challenging Opportunity
  • Looking Ahead
  • Notes
  • Appendix
Page 5: Implications of the Global and Regional Changes for Argentina's Foreign Relations

254 R Russell and J G Tokatlian

administration (2003 ndash 2007) However it found its greatest support in the material

conditions offered by a global and regional scenario that opened new and extraordinary

opportunities to the country China became a key trading partner and Brazil behaved as the

closest country to Argentina during and in the years following the crisis Meanwhile the

United States did not devote much time to Argentina let alone the wider South America

This fact was much more than the mere repetition of the United States tendency to put

Latin America in a secondary position in its foreign policy concerns It has to be situated in

the context of the long-term process of U S hegemonic decline in South America

especially in the Southern Cone countries

More specifically the low strategic relevance of Argentina for the United States helps

explain the growing indifference of Washington towards the country This fact is not new

but has intensified during this century Argentina does not have a prominent place in any of

the priority issues on the United Statesrsquo Latin American agenda trade migration drugs

terrorism and public safety and energy A second factor that also explains Washingtonrsquos

estrangement from Buenos Aires is a sequence of bilateral conflictive episodes of high-

voltage in which Argentina played or was seen to play the role of the actor less open to

dialogue and more prone to overacting Vocal criticism on the Argentine side first to the

IMF and later to Washingtonrsquos policies past and present became louder as Argentinarsquos

economy recovered The climax came at the Fourth Summit of the Americas held in Mar

del Plata on November 4 and 5 2005 where the then president of Argentina Nestor

Kirchner firmly opposed lsquoneoliberalismrsquo and the creation of a hemispheric free trade area

(FTAA) and accused the United States of having an lsquoanachronistic viewrsquo of the problems

afflicting developing countries Moreover he called on Bush to have a more responsible

leadership in Latin America by ending his support for policies that had lsquonot only led to

misery and poverty but also the fall of democratically elected governmentsrsquo9 Mar del Plata

marked a turn for the worse in bilateral relations and Washington was left with a bitter taste

that would linger until the end of George W Bushrsquos presidency Moreover while the so

called lsquoArgentine modelrsquo heterodox and lsquoneo-developmentalistrsquo in its economic

orientation did not fit into the category of lsquoLatin American radical populismsrsquo it was

viewed by US officials with suspicion and disgust Although Nestor Kirchner never

subscribed to the tenets of the lsquosocialism of the twenty-first centuryrsquo Washington watched

with dissatisfaction the close links established betweenArgentina and Venezuelarsquos Chavez

After the inauguration of Cristina Fernandez de Kirchner to the presidency of

Argentina in December 2007 new conflicts contributed to deepen lsquomutual detachmentrsquo

Barack Obamarsquos arrival in office in January 2008 was considered by Buenos Aires as an

opportunity to open a new dialogue Moreover the financial crisis in the United States

merely reinforced government beliefs and policies on the role of the state in the economy

and on the need to reform the multilateral lending agencies However with its first

domestic and foreign policies the Obama Administration soon showed that the ideological

affinities world views and purposes were less similar to what at first could have been

imagined at the Casa Rosada President Fernandez de Kirchner rapidly moved from initial

lsquoadmirationrsquo to conclude that President Obama lsquohad not fulfilled the expectationsrsquo and that

his Administration lsquoignores the needs of the Southern Conersquo10

Over the years the distancing on global and regional issues became apparent the threat

and the use of force in the Middle East Central Asia and Northern Africa the conception

and practice of the lsquoResponsibility to Protectrsquo the statehood condition of Palestine the level

and scope of protectionism the promotion and enforcement of stronger financial regulations

worldwide the approach vis-a-vis specific countries such as Iran the half-century old

Cuban blockade the debate and reform over crucial aspects of the Inter-American system

Dow

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ovem

ber

2014

Journal of Iberian and Latin American Research 255

such as the Inter-American Defence Board and the Inter-American Treaty of Reciprocal

assistance the differences in views and attitudes vis-a-vis a sort of lsquoneo-coupismrsquo

(neogolpismo) in the region such as in Venezuela (2002) Honduras (2009) Ecuador (2010) and Paraguay (2012) and the broadening and militarization of the lsquowar on drugsrsquo However

a simultaneous convergence on important world and continental topics has been evident

acting in favour of nuclear non-proliferation avoiding the presence of transnational

terrorism in the area (for example in the Tri-border zone of Argentina Brazil and

Paraguay) supporting the human rights component of the Inter-American system and

participating in humanitarian missions such as the one in Haiti

In brief by the end of the first year of the second mandate of President Fernandez de

Kirchner and after the re-election of President Obama for a second term the bilateral

relationship remained characterized by little presidential dialogue low shared-

expectations outspoken differences and specific cooperation only on issues of common

interest Key coincidences and several major differences have not been institutionalized in

a general framework by which the mixture of consensus and dissent could be managed On

many occasions first and second-level government officials in Washington and Buenos

Aires overreacted to an incident or underplayed an accord In most cases the perception at

the highest level of each government was one of misunderstanding tiredness and

discomfort

Within this context the fact that Argentina will occupy a non-permanent seat on the

UN Security Council in 2013 ndash 2014 where critical issues will be on the agenda (some of

significance for Buenos Aires including the Malvinas-Falkland question as well as the

lsquovulture fundsrsquo suing Argentina in US courts regarding the 2001 debt default) Requiring

Washington to play a positive role may generate a situation that pushes both countries to

at least devise an improved consultative mechanism in order to handle their relationship

with more maturity and realism

Relations between Argentina and Brazil have been marked by the increase in

asymmetries between the two countries in terms of capabilities as well as in international

projection Since the crisis of 2001 Argentina has undergone a gradual process of

economic and self-esteem recovery whereas Brazil has consolidated its position as an

emerging power both regionally and globally These developments together with the loss

of US centrality in South America and Mexicorsquos growing links and interdependence with

North America have dramatically altered the geopolitical landscape in Latin America

particularly in South America

Three distinct phases can be highlighted in the Argentine-Brazilian relationship

since the beginning of the twenty-first century11 The first extends from the crisis of

2001 through 2003 and is characterized by the growing importance given to Brazil by

the elites and public opinion in Argentina While other governments were abandoning

Argentina the Fernando Henrique Cardoso Administration expressed solidarity with

the government led by Eduardo Duhalde during the time of crisis arguing that the

International Monetary Fund could not be insensitive to the serious situation which

afflicted Argentina and said that Brazil continued to trust in its main Mercosur

trading partner Later with Lula already in the Planalto the idea of Brazil as

lsquoalternative development modelrsquo to the one implemented in the 1990s and as the

lsquomain cardrsquo of Argentinarsquos international insertion became dominant in Buenos Aires

Nestor Kirchner took office in May 2003 stating Brazilrsquos importance for Argentina

and emphasized the need to give more weight and density to a common strategic

project However this positive vision of the bilateral relationship was expressed at the

beginning of a phase in which Argentina was leaving behind the crisis With gradual

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256 R Russell and J G Tokatlian

recovery came the revival in Argentina of an ambiguity vis-a-vis Brazil Although

Brazil was seen as a key player and partner it also raised suspicions and doubts

throughout the whole Argentine political spectrum Its status as an emerging power

produced concerns For the Right in Argentina the Lula presidency gave reasons to

refloat the perception of Brazil as an lsquoincorrigiblersquo country The different assessments of

the strategic condition of South America vis-a-vis Latin America also reappeared and with it

fears of a possible Brazilian hegemony in South America The government of Fernando de la

Rua (1999ndash2001) had had a preventive and defensive attitude about the political idea of South

America proposed by Brazil ndash a political and economic geographic area with its own

peculiarities and different from the lsquoLatin America of the Northrsquo The government of Nestor

Kirchner also adopted a reluctant position An eloquent example of this attitudewas President

Kirchnerrsquos decision not to attend the gestation of the South American Community of Nations

meeting (prior to its transformation into the Union of SouthAmericanNations) in 2004 on the

grounds that it was an instrument created by Brazil to project and ensure its own power in

the region

References to Brazil arose in the context of a stagnating Mercosur Repeated promises

to give the bloc a new birth ndash the so called lsquorelanzamientorsquo ndash could not hide that in terms

of its economic significance Mercosur exhibited clear signs of exhaustion Moreover

similar views in both capitals about the lsquodevelopment modelrsquo did not help to give more

oxygen to the integration process The convergence between Kirchner and Lula on the

need to restore the lsquoindustrialistrsquo vision of integration as opposed to the lsquocommercialrsquo

approach of the nineties gave the impression that the two countries were ready to give its

ties a new strategic perspective However the bilateral agenda of lsquoproductiversquo integration

and Brasiliarsquos acceptance of the importance of the lsquore-industrializationrsquo of Argentina were

interpreted in Buenos Aires as a right to establish protectionist measures for Brazilian

exports that threatened the national industry and even more to ignore certain rules This

propensity for defensive policies not only emphasized the lsquofatiguersquo of Mercosur but also

contributed to the low willingness on the part of Brasilia to accept limits to the

autonomous management of its foreign policy Integration never ceased to be a goal for

Brazil but with time acquired a minor role in the priorities of its foreign policy Its

systematic rejection of a surrender of elements of sovereignty and autonomy to the

Mercosur was one of the determinants of the institutional weakness of the bloc Moreover

as Monica Hirst has put it lsquothe importance of the South American economies as a space for

a larger expansion of the Brazilian companies and the statersquos presence as an investor

(Petrobras) and financier (BNDES) [Brazilian Development Bank] became more

important for Brazilian material and strategic interests that the regional integration

process especially the Mercosurrsquo12 In short ambiguous perceptions coexisted in

Argentina with fluctuating bilateral relations The setting was propitious for the

reappearance of anti-Brazil perceptions in Argentina The pro-Brazilian episodic euphoria

of the years of Duhalde (Brazil as a lsquogreat strategic allyrsquo) turned into doubt and criticism in

the second phase which goes from the beginning of 2004 to the end of 2006 Explicitly

and implicitly by both the Right and the Left an ambivalent feeling towards Brazil

unfolded albeit without the pugnacity of the past but nevertheless highlighting the

difficulties of embedding a culture of friendship between the two countries13

As in other debates in Argentina these visions were remnants of perceptions forged in

the seventies and nineties Kirchnerrsquos own ambiguities style and measures in government

did not help to build a more positive image of the role of Brazil for Argentina Several

groups located in the Ministry of Foreign Affairs the business world think-tanks and the

media encouraged the counterbalancing of Brazil in lsquoSouth Americarsquo by means of a

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Journal of Iberian and Latin American Research 257

lsquoLatin-Americanrsquo policy in which the role of Mexico was presented as crucial On the

other hand the vision of Chile as a partner for a more balanced South America and as an

economic model also regained strength in a wide spectrum of the Argentine elites covering

the Right to the centre-Left Chilersquos image was contrasted with that of Brazil The first was

seen essentially as lsquopredictablersquo and lsquoreasonablersquo while the second after the triumph of

Lularsquos Workers Party tended to be presented on the opposite side For some closer

relations with Chile would serve to offset the influence of Brazil in the Southern Cone ndash a

Santiago ndash Buenos Aires axis to limit the Brazilian aspiration to lead the area ndash while

others perceived the lsquoChilean wayrsquo as the best manner for taking a safe distance from

Mercosur which was perceived as an obstacle to establishing a flexible dense and fruitful

relationship with the rest of the world Finally the Left identified the relationship with

Venezuela as a balancing factor for restraining the power of Brazil

The third phase of Argentine ndash Brazilian relations started at the end of 2006 and

extends to the present An interesting twist can be observed in the direction of a more

positive perception of Brazil that clearly puts it in a central place for Argentina Two main

factors explain this change The first and most important is the growing international

relevance and regional weight of Brazil This process has led to the formation of a

widespread perception in Argentina that defines Brazil as lsquoinevitablersquo with a predominant

negative and generally pessimistic bias or as a country that is lsquoindispensablersquo in this case

emphasizing the possibility of building a common future and a strong cooperative

relationship The idea of Brazil as a necessary country is widely accepted but has

variously been accepted with resignation disgust and joy alternatively viewed as an

opportunity or severe challenge The lsquosuccessrsquo of Brazil is often contrasted with the

lsquofailuresrsquo of Argentina and generates different feelings such as pain envy nostalgia and

desire for emulation In any case the growth and rise of Brazil has converted it into a

model for almost everyone The second factor is the growing density of bilateral relations

As an example it is interesting to note that Brazil is already the fourth largest foreign

investor in Argentina after the United States Spain and China In 2010 24 of total

exports (42 industrial) and 82 of the cars manufactured in Argentina were directed to

the Brazilian market and 863492 Brazilian tourists visited the country14 At the same

time the expansion of Brazilian companies in Argentinarsquos productive activity and trade

has been impressive in the last decade

The main issue for the future then is how to live and interact with the lsquoinevitablersquo or

lsquoindispensablersquo country This convergence of perceptions regarding the centrality of Brazil

for Argentina only goes so far There is no agreement on the political economic and

strategic interests that should constitute the relationship with Brazil and consequently

about the best ways to put them into practice The transition from an entrenched culture of

rivalry to an incipient culture of friendship has lasted more than a quarter of a century

providing promising dividends for both nations and offering a good platform from which

to renegotiate the growing bilateral ties The world and the region and the national

situation of the two countries especially concerning the distribution of attributes of

economic power are now very different to the 1980s when the two countries took the first

steps to build a positive bilateral relationship The double condition of the Argentine ndash

Brazilian relationship that is its increasingly close and uneven character suggests that

there will be a complex combination of convergence and divergence between the two

nations Argentina and Brazil never were Pakistan and India in terms of antagonism and

sought in the past to jointly become an equivalent to the Franco ndash German axis for the

integration of South America an aspiration that today is unsustainable Circumstances

have changed and the condition of lsquoasymmetric interdependencersquo is recognized and

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2014

258 R Russell and J G Tokatlian

accepted in Argentina although not without the suspicions that characterize the attitudes

of the weaker party in a bilateral relationship In this context the main challenge for

Brasilia and Buenos Aires is to forge a realistic and positive lsquonew dealrsquo that contemplates

with its own specificity the bilateral relationship as well as Mercosur

In the end the above-mentioned three phases show the existence of both a changing

and intricate relationship If the theory of asymmetry is taken into consideration the first

move towards re-negotiating an unbalanced relationship should be initiated to a large

extent by the less powerful party In that sense it is yet unclear what the Argentine elites

(civilian and military economic and intellectual state-based and non-governmental) want

from relations with the continent (including the United States) the Spanish-speaking

region South America and finally Brazil Historically it has been quite difficult for

Argentines to have simultaneous positive relations with Washington and Brasilia In the

last two decades different opinions (sometimes personal more than collective) between

the lsquoLatin-Americanistsrsquo and the lsquoSouth-Americanistsrsquo favouring opposite strategic

options have been vocally expressed Currently several other countries in the area have

been increasing their leverage especially those facing the Pacific This phenomenon does

not go unnoticed by Argentine elites and is another source of domestic debate In this

dynamic and changing regional context Argentina has not been able to clearly establish

the goals and ambitions to guide its foreign policy towards the region and Brazil in

particular The response to this situation should be sought in essence in domestic politics

Relations with China (and Asia) A Historic and Challenging Opportunity

Argentine ndash Chinese links should be placed in the larger context of China ndashLatin America

relations15 From a Latin American perspective Chinarsquos growing presence in the region

has been seen at least in the first decade of the twenty-first century as a promising trend

Chinarsquos ties with Latin America from the 1950s to the 1970s were marginal focused

primarily on cultural diplomacy driven by ideological motives and based on

revolutionary rhetoric This diplomatic strategy relied on the dividends of destabilization

was accompanied by anti-US slogans and was geared toward strengthening pro-Chinese

(and anti-Soviet) political parties and movements Chinarsquos international behaviour during

that period was that of a revisionist actor who sought to change the rules of the game

through aggressive means

In contrast Beijingrsquos approach to the region since the 1990s has involved an active

economic diplomacy characterized by pragmatism conciliation and stability Chinarsquos key

goal and main challenge has been to deepen its relations with the countries of Latin America

without irritating Washington Diplomatically China has proceeded in a judicious fashion

which explains in part why regional forces did not emerge to veto a policy of prudent and

consistent engagement toward China In addition Chinarsquos external diplomatic model has

been seductive to Latin America especially during the two administrations of George

W Bush in the United States multipolarism as opposed to unipolarism multilateralism as

opposed to unilateralism non-interference as opposed to interventionism soft power as

opposed to hard power pragmatism as opposed to ideologisation collaboration as opposed

to domination and persuasion as opposed to coercion All have been attractive notions in

Latin America Chinarsquos contemporary approach coincides with strong Latin American

traditions and aspirations and has become more captivating by virtue of the mishandling

disregard and thoughtlessness of US foreign policy towards the region

Nothing indicates that Latin America is geared towards accepting a paternalistic

externally-induced security dilemma with China and the region does not feel insecure visshy

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2014

Journal of Iberian and Latin American Research 259

a-vis Beijing despite certain ideologically-driven pressure groups in Washington

Moreover the Sino ndash Latin American ndash US triangular relationship has not engendered

major tensions or unmanageable challenges16 There is also nothing to suggest from a

regional viewpoint that Latin America ndash China ndash United States relations are destined to an

apocalyptic geopolitics approach based on an overblown fear of an alleged Chinese

takeover of the region China is not the Soviet Union post 911 is not a rehearsal of the

Cold War Washington is no longer at the pinnacle of world power and Latin America has

not collapsed after the Western economic and financial crisis began in 2008 There is also

no indication that Chinarsquos intention is to challenge the United States in the Western

Hemisphere In fact the Chinese government has actively sought to convince the United

States and the rest of the world that its intentions are benign thus the self-portrayal of a

peaceful rise

Chinarsquos behaviour in Latin America at the outset of the twenty-first century has been

far from that of a revisionist power On the one hand Beijingrsquos strategy has combined

necessity with opportunity and has been put into practice cautiously and diligently

curtailing the likelihood that the region will develop or adopt a policy aimed at rolling

back Chinarsquos presence On the other hand Latin Americarsquos relationship with Beijing is

more dependent on economic facts than political conceptions As there is no major

ideological concern in most countries about dealing with China the crucial element is the

material effect of Sino ndash Latin American linkages the level of dependency of the region

vis-a-vis China the degree of de-industrialization of the area derived from bilateral trade

and the ecological consequences of Chinese investment in Latin America17

This broader framework is essential to understand the dynamics of Argentinarsquos

relations with China in the larger context of Argentinendash Asian links Over the past two

decades the (re)emergence of China and the ascent of Asia have been a blessing for

Argentina Rising demand and higher prices for commodities have made it possible for

Argentina to elevate and diversify its trade flows with the East Since the 1990s and

despite the discernible differences in economic and foreign policies between Carlos

Menem and the Kirchners Argentina has developed a new pattern of production that has

led notwithstanding the crisis of 2001 to a reorganization of the economic base of the

country As noted by Pablo Gerchunoff lsquoIt is not just about the speed of exports there is

also a significant diversification traditional agriculture new agriculture industry energy

and mining concurred to modify the national economic landscapersquo18 In that context and

according to President Nestor Kirchner it was crucial lsquothrough China to search in Asia the

leverage to re-industrialize Argentinarsquo Economy not politics has been the driving force

to improve and extend Argentine relations with the East19

For the first time in more than seven decades Argentina has met a world that eagerly

requires what it produces The key driver of this demand is located in China but covers a

wide range of countries At present China is Argentinarsquos second largest trading partner

both in terms of the origin of imports and recipient of exports ndash in both dimensions after

Brazil and before the United States (See Table 1) Argentina meanwhile ranks third in the

list of the 15 major suppliers of agricultural products which supplied 90 per cent of

Chinese imports in 2010 United States (244) Brazil (136) and Argentina (73)

Other major suppliers were the European Union (6) Australia (5) and Malaysia (5)

By 2001 Argentine exports to China surpassed the US$1 billion barrier to hit US$1123

billion and imports totalled US$1066 billion Thus there was a small surplus of US$56

million in favour of Argentina By 2010 the commercial exchange was worth US$13795

billion totalling US$6117 billion in Argentine exports and US$7678 billion in Chinese

exports The result was a trade balance of US$1561 billion in Chinarsquos favour20 In the

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ber

2014

260 R Russell and J G Tokatlian

period January ndashSeptember 2011 the surplus in favour of China grew While Argentine

exports amounted to US$4746 billion Chinese exports came to US$7569 billion21

India is Argentinarsquos main Asian trading partner after China22 Other important

countries are Indonesia South Korea Malaysia Vietnam and Thailand23 By 2010 when

China implemented barriers to Argentine soybean oil in retaliation for local action that

prevented the entry of Chinese products into the country Argentina reoriented its soybean

exports to India which bought 14 million tons of soybean oil (corresponding to US$12

billion dollars) In September 2011 Indiarsquos ambassador in Argentina said his country

would increase demand for soybean oil over the next ten years from the current 8 million

to 15 million tons representing a significant additional opportunity for Argentine

producers and exporters24

Indeed ties with Asia are not limited to trade Again the paradigmatic case of this

new relationship is China which in recent years has also emerged as an increasingly

important financial actor During 2009 at a high point of the US-originated financial

crisis China and Argentina agreed to swap US$10 billion worth of their currencies in

order to enable Argentina to avoid using dollars in trade between both countries an

agreement that was the first of this sort between China and a South American country25

Beijing simultaneously accelerated its investment in agriculture mining energy and

banking and has become the third largest investor in the country (See Table 2)26 In

addition there is strong Chinese interest for participation in infrastructure development

projects in sectors such as railways roads ports and telecommunications The largest

food company in China Heilonjiang Beida-Huang signed an October 2010 cooperation

agreement with the province of Rıo Negro27 which provides China with twenty-year

leases on provincial lands (20000 hectares at an early stage that may eventually extend

to up to 320000 hectares)28 In return the Chinese company is committed to

undertaking major irrigation and infrastructure works as part of a ten-year investment of

US$15 billion dollars29 Different actors from Argentina are also opening trade offices

in Chinese cities and several twin cities and sister provinces have signed different 30agreements

In the oil sector the China National Offshore Oil Corporation (CNOOC) acquired 50

per cent of Bridas Corporation and Sinopec holds 100 per cent of Argentine assets in

Occidental In addition China controls 50 per cent of the Cerro Dragon field and will

handle major reserves for 40 years in the province of Santa Cruz To sum up Beijingrsquos

growing interest in Argentina has meant that the country is according to Levi J Jordan

from the Americas Society lsquoreceiving almost half of Chinarsquos investment in South America

over the past two yearsrsquo31 In that context the growth of Chinarsquos state corporations is

impressive32 Agreements have also been made in the field of defence the most prominent

is the signing of the Memorandum of Understanding for Strengthening Exchanges and

Cooperation in Defense of 16 May 2007 whereby both countries have committed to

maintain contacts to discuss global and regional security issues to cooperate on military

equipment and logistics and to establish a Defence Joint Commission It is worth

mentioning that officers from Argentina together with military from Chile and Colombia

frequently (more often than counterparts from Cuba and Venezuela) have attended courses

on grand strategy at Beijingrsquos elite national defence university PLANDU33 Even though

Argentina is not a significant South American buyer of military equipment34 has a very

low annual defence budget and that China is not the major supplier of arms to the region

(as it is the case of the United States Russia and the European Union) it has lately

considered the acquisition of Chinese Z-11 helicopters35 Finally after a July 2012 visit to

China by Argentine Defence Minister Arturo Puricelli both countries agreed that

Dow

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2014

Journal of Iberian and Latin American Research 261

Argentina will construct a prototype of that helicopter by 201336 In general the level of

bilateral military dialogue is highly positive37

In key scientific and technological areas there has been an on-going improvement of

relations For example a Satellite Laser Raging (SLR) system designed and made in China

was installed in the Observatory of San Juan University38 Both countries plan to conduct

collaborative activities for Antarctic expedition39 There are many contacts and joint

initiatives in the areas of telecommunications and space40 The two countries are also

interested in creating a Bilateral Centre on Science and Technology for Food41

In addition China will install a satellite station in the province of Neuquen42 while

incrementing its presence in the telecommunications sector and establishing cooperation

ties in the nuclear field43

Argentina and China share important interests in their diplomatic agenda with regards

to the defence of the principle of lsquoterritorial integrityrsquo China consistently supports the

Argentine claim of sovereignty over the MalvinasFalklands while Argentina defends the

policy of lsquoone Chinarsquo which implies the non-recognition of the independence of Taiwan

and Tibet The issue of the MalvinasFalklands Islands has been surfacing for two reasons

On the one hand as Lyle Goldstein has remarked lsquoChinese defence analysts take such

intense interest in the Falkland Warrsquo due to the fact that according to Chinese government

officials and experts there are certain similarities between the Malvinas and Taiwan44 As

Taiwan is a vital issue for Beijing the understanding of the 1982 war in the South Atlantic

is extremely relevant On the other hand the potential closeness of China and Argentina

may provoke in the future a vulnerable situation with regards to the islands that could

affect British defence policy45 In times of a major economic crisis in Europe and with

diminishing possibilities of sustaining high defence budgets retired military officers from

Great Britain overemphasize Londonrsquos potential weakness in the South Atlantic

With respect to issues on the global agenda the two countries agree at the level of the

G-20 on the need for greater participation of emerging nations in international financial

organizations as well as the need to implement measures for the avoidance of financial

speculation that causes volatility in the prices of commodities Both countries have been

supporting peacekeeping operations and they both participate militarily in the UN Mission

in Haiti At the International Atomic Energy Agency Beijing and Buenos Aires have been

active in the promotion of non-proliferation

It is important also to mention a relatively new phenomenon in the relation between

Beijing and Buenos Aires namely Chinese immigration to Argentina There are

approximately 120000 Chinese and Chinese-descendants in Argentina mainly in Buenos

Aires46 Their point of origin is mostly Taiwan and Fujian and to a lesser extent Hong

Kong Even though there are no good estimates or different in-depth studies lsquoChinese

immigration to Argentina is assumed to be largely of illegal naturersquo with lsquoremittances an

important flow of capitalrsquo and Argentina being lsquoan intermediate stoprsquo for approximately

half of the Chinese migrants before seeking entry into the United States (mainly) or the

European Union47

To sum up the capabilities willingness and needs of both sides make the relationship

between Argentina and China (and Asia) complementary The East needs raw materials

(energy food and mining) and Argentina needs investments and infrastructure Of course

a link of this nature presents opportunities but also brings risks It has become fashionable

in Argentina to compare the current situation with the golden years of the lsquospecial

relationshiprsquo with Great Britain (and Europe) that was undoubtedly the engine of the great

Argentine take off between 1880 and 1914 It is also noted that the new relationship with

Asia offers great benefits to the neighbouring countries and therefore does not threaten the

Dow

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ber

2014

262 R Russell and J G Tokatlian

harmony existing in the sub-region48 While recognizing the historic opportunity offered

to Argentina by the (re)emergence of China and the advancement of several Asian nations

others emphasize the risks especially those coming from China

Within that context it is relevant to mention that the highly optimistic somehow-naive

phase of Chinese ndash Latin American relations is experiencing changes including in

Argentina ndash China relations Most countries in the region and among them Argentina are

slowly moving from a strategy of lsquoreliable engagementrsquo49 to a more mixed strategy based

on a prudent approach that combines strong commercial ties and active damage-control

policies50 Latin American countries are well aware of the importance of key economic

issues and the sensitive security questions that characterize the regionrsquos relations with

China Concerns about de-industrialization via commodity-based export growth (affecting

basically South America) the effect of global lsquocurrency warsrsquo on the region (affecting all

of Latin America) and the impact of a decisive push for rural production within China

(affecting mainly Mexico and Central America) are extremely critical issues from North to

South America

On a broader outlook the fact that the global system is witnessing a period of

uncertainty is generating a new examination of Chinarsquos lsquowin-winrsquo diplomacy51 This is a

time of difficulties that places limits on Beijingrsquos global and regional strategies Not

surprisingly Argentina as well as other countries in Latin America is rethinking its ties

with China under a more nuanced viewpoint The advantages and dividends of more

commercial and financial links with China are superseded by new productive challenges

(for example excessive emphasis on commodities for export) at home and sensible

differences abroad (for example in the case of human rights) Interests and values are now

inextricably intertwined in Argentine ndash Chinese diplomacy In this context the deployment

of a more sophisticated policy vis-a-vis Beijing seems inevitable Necessity more than

willingness is pressing Buenos Aires to design a broader Asian strategy where China will

be a centrepiece but not the only counterpart politically and materially for the country

Looking Ahead

Argentinarsquos foreign policy developed historically from 1880 until the early twenty-first

century around three areas Europe the United States and Latin America especially the

Southern Cone countries Relations with the socialist world particularly with the Soviet

Union for political and commercial reasons were also important in the second half of the

twentieth century but never reached the scale of the other three axes In the decade since

2000 a fourth axis has been added to this traditional pattern with extraordinary strength

and projection the Asia Pacific region dominated by China

Relations with Europe remain important since there are shared interests and values and

a long history of mutual interaction In addition Argentina continues to need European

investments and technology transfers and the EU is still an important trading partner (See

Table 3) But Europe like Japan and the United States is a market in which exports have

shown in the last decade ceilings that are difficult to overcome The most dynamic and

consolidated markets for Argentina are in Latin America and Asia There are also other

developing markets that are growing at a faster pace than the rest of the world and offer

new opportunities for Argentine exports (Australia Canada Russia South Africa and

Turkey) In the next years Europe will focus its attention on domestic issues and other

areas of the world It is unlikely that any significant progress in the relations with

Argentina and Mercosur could be made in the short run A longer-term view suggests that

Dow

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ber

2014

Journal of Iberian and Latin American Research 263

Europe will increasingly lose its relative importance for Argentina and that its historically

privileged position in the countryrsquos foreign relations will be a thing of the past

Argentinarsquos relations with the United States have never been easy Joseph Tulchin

summarizes its nature in the title of his well-known book Argentina and the United States A Conflicted Relationship52 The strategy of lsquocouplingrsquo implemented during the Menem

years was a pragmatic adaptation to the world of the immediate post-Cold War and was

buried as a strategic option for Argentina with the 2001 crisis In the decade of 2000 the

Kirchners went back to the traditional historical pattern that we have called lsquolimited

oppositionrsquo53 This pattern which combines collaboration and disagreement deference

and resistance will continue to guide Argentinarsquos foreign policy toward Washington but

in a framework in which Buenos Airesrsquos concerns about restraining the United States

preponderance and power will tend to decrease Present conditions offer a great lsquoobjectiversquo

opportunity for the development of new areas of selective collaboration between the two

countries at the bilateral and regional levels A new era of relations with the United States

seems to be beginning for the Southern Cone one that is less unequal and perhaps more

cooperative The key challenge for Argentina is coping with a new reality of diminishing

influence of Washington in the sub-region Most of the time power erosion produces two

alternative behaviours adaptation or denial At least for the time being the relative decline

of US hegemony in South America is showing signs of a lsquosoft landingrsquo If this scenario

prevails then Argentina may manage its bilateral relation with the United States in a more

constructive way

In the case of Brazil it seems that we are entering a second long cycle of convergent

views about the place of this country in Argentinarsquos foreign policy54 This cycle may be

compared and opposed to another long period of convergent visions that characterized the

dominant form in which the neighbour country was perceived by the Argentine elites

during most of the twentieth century Today Brazil is defined as a strategic partner while

in the past until the return of both countries to democracy it was seen as a rival As we

have already mentioned the main challenge for Argentina is how to build this strategic

partnership within a framework of growing asymmetry

The link with Argentina although very important does not have today the same value

for Brazil as in the second half of the eighties By contrast the relationship with Brazil is

increasingly relevant for Argentinarsquos foreign relations and one that presents a significant

challenge In the past the relative symmetry between both countries was a constant source

of suspicion and conflict In the future the condition of asymmetric interdependence as a

structural feature of the relationship will not allow for competition but also is no

guarantee of friendship or cooperation Rather it can become a new source of suspicion

distrust and differences Argentina and Brazil will have to learn to live together in this new

reality and develop a broader framework of mutual understanding to manage the major

density of bilateral links and the global issues of common interests The greatest effort

must come from Argentina because it is the country that has a higher interest in the

relationship and more to gain

Finally the emergence of Asia is offering Argentina a unique opportunity for a

dynamic and successful international integration Its most recent economic dynamism is a

direct result of the increased demand from China and other Asian countries for food and

raw materials However Argentinarsquos exports to Asia are highly concentrated in the

soybean complex and to a much smaller extent in a small group of primary and natural

resource intensive products According to the latest ECLAC report five major products

accounted for 92 of total exports from Argentina to China during the years 2007 ndash 2009

(soybean 531 soybean oil 265 crude oil 747 other cattle 248 and meat and

Dow

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ber

2014

264 R Russell and J G Tokatlian

poultry offal 233)55 Moreover the trade surplus with China has tended to evaporate

after several years of significant positive balances

This situation raises many questions about the Argentine specialization pattern ndash

beyond issues related to trade with China ndash and the need to reduce an excessive

dependence on the export of commodities Nevertheless as the benefits of trade with

China have been so high and have also enabled Argentina to successfully face and resist

the financial crises in the centres the propensity to do nothing is great As Eric Farnsworth

recently observed lsquoWhen nations are able to sell as much as they can produce of any

particular product the thinking is generally to continue doing so and reap the rewards

When economies are growing there is little political imperative or incentive for reformrsquo56

In consequence a relevant question surrounding this type of relationship is how to avoid

the temptation to inertia The tendency towards passive repetition is appealing The China

lsquochallengersquo in the early twenty-first century for Argentina is how to think and act

differently from what had been the case of Argentine ndash British relations at the beginning of

the twentieth century The framing of a different link with Beijing as well as the positive

handling of an increasingly complex multifaceted multilevel relationship with Brazil

seem to be the major challenges ahead for Argentinarsquos foreign relations

Notes 1 Roberto Russell and Juan G Tokatlian El lugar de Brasil en la polıtica exterior argentina

Buenos Aires Fondo de Cultura Econo mica 2003 pp 45 ndash 59 2 We use the concept lsquosystemic changesrsquo in the same sense as Robert Gilpin See his book War

and Change in World Politics Cambridge Cambridge University Press 1981 pp 42ndash 43 3 For an interesting analysis of these debates see Jose Paradiso Debates y trayectoria de la

polıtica exterior argentina Buenos Aires Grupo Editor Latinoamericano 1993 4 On the concept lsquoasymmetryrsquo and its implications for bilateral relations see Brantley Womack

lsquoAsymmetry and Systemic Misperception China Vietnam and Cambodia during the 1970rsquosrsquo Journal of Strategic Studies 262 June 2003 pp 92ndash 119

5 On structural and relational power see Susan Strange States and Markets An Introduction to International Political Economy London Pinter 1988 pp 25ndash9

6 David C Kang lsquoThe theoretical roots of hierarchy in international relationsrsquo Australian Journal of International Affairs 583 September 2004 p 339

7 Roberto Russell and Juan G Tokatlian lsquoBeyond Orthodoxy Asserting Latin Americarsquos New Strategic Options Toward the United Statesrsquo Latin America Politics and Society 533 Winter 2011 pp 129 ndash 134

8 Eric Hobsbawm lsquoDespues del siglo XX un mundo en transicionrsquo in Ricardo Lagos (ed) America Latina iquestintegracion o fragmentacion Buenos Aires Edhasa 2008 pp 29ndash 47

9 Remarks by the President of the Argentine Republic Nestor Kirchner at the inauguration of the IV Summit of the Americas Mar del Plata httpwwwsummit-ameicasorgDocuments 20del20presidente20de20RepC3BAblica20Argentinapdf

10 La Nacion (Buenos Aires) lsquoCristina Kirchner critico a Obama con duros terminosrsquo 26 February 2010 Available at httpwwwlanacioncomar1237368-cristina-kirchner-criticoshya-obama-con-duros-terminos accessed 17 November 2011

11 For more in depth analysis of the bilateral relations see Russell and Tokatlian El lugar de Brasil pp 45ndash59 and Roberto Russell and Juan G Tokatlian lsquoPercepcoes argentinas sobre o Brasil ambivalencias e expectativasrsquo Polıtica Externa 202 September 2011 pp 43ndash 56

12 Monica Hirst lsquoLa polıtica sudamericana de Brasil entre el peso de las asimetrıas y la incidencia de nuevas coyunturasrsquo in F Calderon (ed) Escenarios polıticos en America Latina Conceptos metodos y Observatorio Regional Cuadernos de Gobernabilidad Democratica 2 Buenos Aires PNUD Siglo XXI 2008 p 257

13 We use the concept of friendship following Alexander Wendt Social Theory of International Politics Cambridge Cambridge UP 1999 pp 297ndash 308

14 La Nacion Economıa y Negocios Buenos Aires lsquoBrasil en la vida cotidiana argentinarsquo 22 May 2011 p 1

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] at

02

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ber

2014

Journal of Iberian and Latin American Research 265

15 On China ndash Latin America relations at the beginning of the XXI Century see Juan G Tokatlian lsquoA view from Latin Americarsquo in R Roett and G Paz (eds) Chinarsquos Expansion into the Western Hemisphere Implications for Latin America and the United States Washington DC Brookings Institution Press 2008

16 According toMark P Sullivan a specialist on Latin American affairs at theUS Congressional Research Service lsquoThe balance of opinion toward China and the United States in Latin America tend to be roughly comparable according to a (2007) Pew study Two exceptions are Argentina where China is viewed much more favorably than the United States and in Mexico where the United States is viewed much more favorably than Chinarsquo See Thomas Lum (ed) lsquoComparing Global Influence China and US Diplomacy Foreign Aid Trade and Investment in the Developing Worldrsquo in CRS Report to Congress August 15 2008

17 Kevin Gallagher lsquoLatin Americarsquos China challengersquo 2011 Policy Innovations httpwwwase tuftsedugdaePubsrpGallagher_PolicyInnovationsJan11pdf accessed 18 November 2011

18 Pablo Gerchunoff 2010 lsquoCausas y azares en mas de un siglo de historia econo mica argentinarsquo in R Russell (ed) Argentina 1910ndash2010 Balance de un siglo Buenos Aires Taurus p 152

19 See the complete quote in Sergio Cesarin lsquoChina y Argentina Enfoques y recomendaciones para potenciar la relacion bilateralrsquo Serie Aportes 2010 httplibraryfesdepdf-filesbueros argentinien07560pdf accessed 28 November 2011

20 Based on INDEC 2011 and Comercio Exterior Argentino 2010 httpwwwindecgovar accessed 13 November 2011

21 Camara de Exportadores de la Republica Argentina En Contcto China No 43 November 2011 p 16

22 In October 2009 President Cristina Fernandez de Kirchner visited India It was her first trip to an Asian country after her inauguration in December 2007 and it was the first visit of an Argentine president to India since 1994

23 It is important to mention the cases of Indonesia and Vietnam for two reasons the growth of trade in the last decade and the fact Argentine exports to these two countries are mainly nonshytraditional commodities For example exports to Indonesia jumped fromUS$43million in 2001 to US$852 million in 2010 while exports to Vietnam grew from US$60 million in 2001 to US $654 million in 2010 Cların iEco Buenos Aires lsquoArgentina en mas puertosrsquo 28 August 2011

24 La Nacion Economıa y Negocios Buenos Aires lsquoLa soja argentina ahora apunta a la Indiarsquo 15 September 2011 p 3

25 China Daily lsquoArgentina China sign tentative swap dealrsquo 31 March 2009 httpwww chinadailycomcnchina2009-0331content_7635007htm accessed 11 November 2011

26 Argenpress (Buenos Aires) lsquoInversiones chinas en la Argentina Claves del nuevo escenario energeticorsquo 14 June 2011 httpwwwargenpressinfo201106inversiones-chinas-enshyargentina-claveshtml accessed 19 November 2011

27 See text of the agreement at httpwwwgrrorgarrionegro-chinaacuerdo-saiz-chinapdf accessed 26 Nov 2011 and El Cronista Buenos Aires lsquoChina invierte 1500 millones en Rıo Negro para asegurarse alimentosrsquo 9 June 2011 httpwwwcronistacomnegocios China-invierte-us-1500-millones-en-Rio-Negro-para-asegurarse-alimentos-20110609-0033 html accessed 19 November 2011

28 On other actual and potential Chinese investments in Argentine provinces see Camara Argentino China Negocios con China 2011 httpwwwargenchinaorgarticulos_2010 NegociosConChinapdf accessed 14 November 2011 and FUNDAMIN lsquoChina invierte en las 23 provincias argentinasrsquo httpfundamincomaresinfo36-exportaciones-e-importaciones 299-china-invierte-en-las-23-provincias-argentinashtml accessed 19 November 2011

29 httpwwwnoalaminaorgmineria-informacion-generalgeneralargentina-china-recreacionshyde-la-vieja-qrelacion-especialq-con-gran-bretana accessed 20 January 2012

30 lsquoLas relaciones entre China y Argentinarsquo httpespanolcricn1161201211281s264119 htm accessed 17 November 2011

31 lsquoRailway rapprochement China invests in Argentinarsquo 2010 httpwwwas-coaorgarticles 2528Railway_Rapprochement_China_Invests_in_Argentina accessed 17 Nov 2011

32 Silvia Simonit lsquoLas empresas chinas en Argentinarsquo Chinese Studies Working Paper Series (Universitat Pompeu Fabra) No 1 2011

33 Loro Horta lsquoIn Uncle Samrsquos Backyard Chinarsquos Military Influence in Latin Americarsquo Military Review September-October 2008 p 48

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ovem

ber

2014

266 R Russell and J G Tokatlian

34 As are the cases of Brazil Chile Colombia and Venezuela 35 Seguridad y Defensa lsquoEl Ejercito Negocia con China la compra de helico pterosrsquo 10 October

2010 httpwwwseguridadydefensacomarnoticiasejercito-negocia-con-china-la-comprashyde-helicopteros-25059html accessed 10 November 2011

36 httpwwwelmetroonlinecomarindexphpoption frac14com_k2ampviewfrac14 itemampidfrac141067 purishycelli-firmC3B3-convenio-de-defensa-con-chinaampItemid frac14238 accessed 12 September 2012

37 China Military Online lsquoChang Wanquan holds talks with Argentine deputy Defense ministerrsquo 28 November 2011 httpengchinamilcomcnnews-channelschina-militaryshynews2011-1128content_4725893htm accessed 29 November 2011

38 T Wang et lsquoNew SRL station running in San Juan of Argentinarsquo Crustal Dynamics Data Information System nd httpcddisgsfcnasagovlw15docspapersNew20SLR20Station 20Running20in20San20Juan20of20Argentinapdf accessed 9 November 2011

39 Chinese Academy of Sciences lsquoChina Argentina to strengthen cooperation on Antarctic expeditionrsquo 16 August 2010 httpenglishbiccascnNE201008t20100816_57510html accessed 29 November 2011

40 Janie Hulse lsquoChinarsquos Expansion into and US withdrawal from Argentinarsquos telecommunicashytions and space industries and the implications for US national securityrsquo Strategic Studies Institute September 2007 httpwwwstrategicstudiesinstitutearmymilpdffilespub806pdf accessed 7 November 2011

41 Ministry of Science and Technology lsquoChina y la Argentina se reu nen para desarrollar un Centro Binacionalrsquo 2011 httpwwwmincytgovaragendaagenda_detalle phpid_ agendafrac1435 accessed 16 November 2011

42 httpwwwlmneuquencomarnoticias201282avanza-instalacion-de-una-estacion-satel ital-de-china-en-la-provincia_156999 accessed 14 October 2012

43 httpwwwstrategicstudiesinstitutearmymilpubssummarycfmqfrac14 806 accessed 29 November 2011 httpenergyseenewscomnewsargentina-china-sign-nuclear-coop eration-agreement-306141 accessed 3 November 2012

44 For the major reasons that motivated this interest see Lyle Goldstein lsquoChinarsquos Falklands Lessonsrsquo Survival 503 2008 pp 65-66

45 UKNDA Inconvenient Truths Threats Justify Prioritising Defence London UKNDA 2011 p 24

46 La Nacion Buenos Aires lsquoVivir en la Argentina estudiar en Chinarsquo 11 October 2011 http wwwlanacioncomar1413556-vivir-en-la-argentina-estudiar-en-china accessed 9 Novemshyber 2011

47 G M Calderon lsquoInmigracion china en las Americas Comparacion de las experiencias en Canada y Argentinarsquo Revista Argentina de Estudios Canadienses No 2 2008 p 30

48 La Nacion Buenos Aires lsquoChina Una oportunidad histo ricarsquo 26 July 2011 49 Juan Tokatlian lsquoLatin America China and the United States A Hopeful Trianglersquo 2007

Open Democracy httpwwwopendemocracynetdemocracy-protesthopeful_triangle_ 4336jsp accessed 4 November 2011

50 La Nacion Buenos Aires lsquoUna nueva estrategia hacia Chinarsquo 29 August 2011 51 Brantley Womack lsquoBeyond Win-Win Rethinking International Relationships in an Era of

Economic Uncertaintyrsquo Paper presented to the International Conference on the Chinese Models of Development Domestic and Global Aspects Taipei Taiwan September 2011

52 Joseph Tulchin Argentina and the United States A Conflicted Relationship New York Macmillan 1990

53 Russell and Tokatlian lsquoBeyond Orthodoxyrsquo 54 According to the latest report of Latinobaro metro 52 of the Argentines consider Brazil as

the main leader of Latin America while only 2 gives that condition to the United States http wwwlatinobarometroorglatinoLATContenidosjsp accessed 23 November 2011

55 Osvaldo Rosales lsquoLa Republica Popular China y America Latina y el Caribe Hacia una nueva fase en el vınculo econo mico comercialrsquo 2011 ECLAC httpwwweclacorgpubl icacionesxml643666La_Republica_Popular _China_y_America_Latina_y_el_Caribe _ tradepdf accessed 10 November 2011

56 Eric Farnsworth 2011 lsquoThe New Mercantilism Chinarsquos Emerging Role in the Americasrsquo Current History February Available at httpwwwas coaorgarticles2982The_New_shyMercantilism_Chinas_Emerging_Role_in_the_Americas accessed 28 November 2011

Dow

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ber

2014

Journal of Iberian and Latin American Research 267

Appendix 1

Table 1

Argentinean trade with Brazil in millions of dollars 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Exports 6206 4828 4666 5587 6335 8141 10498 13272 11374 14420 Imports 5230 2517 4700 7567 10187 11749 14523 17687 11822 17658 Trade 975 2310 233 21980 23852 23608 24025 24415 2448 23238 balance

Argentinean trade with the United States in millions of dollars 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Exports 2840 2869 3364 3733 4493 4025 4153 5095 3465 3656 Imports 3737 1789 2238 3389 3998 4247 5264 6894 5106 6125 Trade 2897 1080 1126 344 495 2222 21111 21799 21641 22469 balance

Argentinean trade with China in millions of dollars 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Exports 1123 1092 2483 2628 3193 3476 5170 6355 3668 6117 Imports 1066 330 721 1402 2237 3122 5093 7104 4823 7678 Trade 56 762 1762 1227 956 354 77 2 749 2 1155 2 1561 balance

Source INDEC and UNCTAD

Table 2

FDI stock in Argentina by country of origin in millions of dollars (selected countries) 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

USA 16422 7476 7989 10277 11689 12208 13601 13930 14012 14814 of total 238 231 208 182 187 176 175 172 175 168

Brazil 1953 2108 3280 1773 2488 2810 3659 4969 4319 5367 of total 283 651 856 314 397 406 470 614 539 608

China no data no data no data 13 11 45 120 141 123 5500 of total no data no data no data 002 002 006 015 017 015 623

Total 68935 32403 38323 56554 62639 69292 77899 80941 80144 88249

for the years 2001 2002 and 2003 the data for Brazil includes all FDI from South America excluding ChileFrom 2003 onwards the data is exclusively for BrazilSource INDEC and UNCTAD

Table 3

Argentinean trade with the European Union in millions of dollars 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Exports 4698 5309 6079 6209 6844 8010 9901 13173 10278 11026 Imports 4717 2107 2814 4237 4830 5811 7442 9043 6434 7587 Trade 219 3201 3265 1972 2013 2199 2458 4130 3845 3439 balance

FDI from the European Union in Argentina in millions of dollars 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

FDI 38279 18284 21273 33001 36848 40408 45159 45070 44963 47605 of total 5553 5643 5551 5835 5883 5832 5797 5568 5610 5394 Total 68935 32403 38323 56554 62639 69292 77899 80941 80144 88249

Source INDEC and UNCTAD

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ber

2014

  • Abstract
  • The United States and Brazil Losing and Gaining Centrality
  • Relations with China (and Asia) A Historic and Challenging Opportunity
  • Looking Ahead
  • Notes
  • Appendix
Page 6: Implications of the Global and Regional Changes for Argentina's Foreign Relations

Journal of Iberian and Latin American Research 255

such as the Inter-American Defence Board and the Inter-American Treaty of Reciprocal

assistance the differences in views and attitudes vis-a-vis a sort of lsquoneo-coupismrsquo

(neogolpismo) in the region such as in Venezuela (2002) Honduras (2009) Ecuador (2010) and Paraguay (2012) and the broadening and militarization of the lsquowar on drugsrsquo However

a simultaneous convergence on important world and continental topics has been evident

acting in favour of nuclear non-proliferation avoiding the presence of transnational

terrorism in the area (for example in the Tri-border zone of Argentina Brazil and

Paraguay) supporting the human rights component of the Inter-American system and

participating in humanitarian missions such as the one in Haiti

In brief by the end of the first year of the second mandate of President Fernandez de

Kirchner and after the re-election of President Obama for a second term the bilateral

relationship remained characterized by little presidential dialogue low shared-

expectations outspoken differences and specific cooperation only on issues of common

interest Key coincidences and several major differences have not been institutionalized in

a general framework by which the mixture of consensus and dissent could be managed On

many occasions first and second-level government officials in Washington and Buenos

Aires overreacted to an incident or underplayed an accord In most cases the perception at

the highest level of each government was one of misunderstanding tiredness and

discomfort

Within this context the fact that Argentina will occupy a non-permanent seat on the

UN Security Council in 2013 ndash 2014 where critical issues will be on the agenda (some of

significance for Buenos Aires including the Malvinas-Falkland question as well as the

lsquovulture fundsrsquo suing Argentina in US courts regarding the 2001 debt default) Requiring

Washington to play a positive role may generate a situation that pushes both countries to

at least devise an improved consultative mechanism in order to handle their relationship

with more maturity and realism

Relations between Argentina and Brazil have been marked by the increase in

asymmetries between the two countries in terms of capabilities as well as in international

projection Since the crisis of 2001 Argentina has undergone a gradual process of

economic and self-esteem recovery whereas Brazil has consolidated its position as an

emerging power both regionally and globally These developments together with the loss

of US centrality in South America and Mexicorsquos growing links and interdependence with

North America have dramatically altered the geopolitical landscape in Latin America

particularly in South America

Three distinct phases can be highlighted in the Argentine-Brazilian relationship

since the beginning of the twenty-first century11 The first extends from the crisis of

2001 through 2003 and is characterized by the growing importance given to Brazil by

the elites and public opinion in Argentina While other governments were abandoning

Argentina the Fernando Henrique Cardoso Administration expressed solidarity with

the government led by Eduardo Duhalde during the time of crisis arguing that the

International Monetary Fund could not be insensitive to the serious situation which

afflicted Argentina and said that Brazil continued to trust in its main Mercosur

trading partner Later with Lula already in the Planalto the idea of Brazil as

lsquoalternative development modelrsquo to the one implemented in the 1990s and as the

lsquomain cardrsquo of Argentinarsquos international insertion became dominant in Buenos Aires

Nestor Kirchner took office in May 2003 stating Brazilrsquos importance for Argentina

and emphasized the need to give more weight and density to a common strategic

project However this positive vision of the bilateral relationship was expressed at the

beginning of a phase in which Argentina was leaving behind the crisis With gradual

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ber

2014

256 R Russell and J G Tokatlian

recovery came the revival in Argentina of an ambiguity vis-a-vis Brazil Although

Brazil was seen as a key player and partner it also raised suspicions and doubts

throughout the whole Argentine political spectrum Its status as an emerging power

produced concerns For the Right in Argentina the Lula presidency gave reasons to

refloat the perception of Brazil as an lsquoincorrigiblersquo country The different assessments of

the strategic condition of South America vis-a-vis Latin America also reappeared and with it

fears of a possible Brazilian hegemony in South America The government of Fernando de la

Rua (1999ndash2001) had had a preventive and defensive attitude about the political idea of South

America proposed by Brazil ndash a political and economic geographic area with its own

peculiarities and different from the lsquoLatin America of the Northrsquo The government of Nestor

Kirchner also adopted a reluctant position An eloquent example of this attitudewas President

Kirchnerrsquos decision not to attend the gestation of the South American Community of Nations

meeting (prior to its transformation into the Union of SouthAmericanNations) in 2004 on the

grounds that it was an instrument created by Brazil to project and ensure its own power in

the region

References to Brazil arose in the context of a stagnating Mercosur Repeated promises

to give the bloc a new birth ndash the so called lsquorelanzamientorsquo ndash could not hide that in terms

of its economic significance Mercosur exhibited clear signs of exhaustion Moreover

similar views in both capitals about the lsquodevelopment modelrsquo did not help to give more

oxygen to the integration process The convergence between Kirchner and Lula on the

need to restore the lsquoindustrialistrsquo vision of integration as opposed to the lsquocommercialrsquo

approach of the nineties gave the impression that the two countries were ready to give its

ties a new strategic perspective However the bilateral agenda of lsquoproductiversquo integration

and Brasiliarsquos acceptance of the importance of the lsquore-industrializationrsquo of Argentina were

interpreted in Buenos Aires as a right to establish protectionist measures for Brazilian

exports that threatened the national industry and even more to ignore certain rules This

propensity for defensive policies not only emphasized the lsquofatiguersquo of Mercosur but also

contributed to the low willingness on the part of Brasilia to accept limits to the

autonomous management of its foreign policy Integration never ceased to be a goal for

Brazil but with time acquired a minor role in the priorities of its foreign policy Its

systematic rejection of a surrender of elements of sovereignty and autonomy to the

Mercosur was one of the determinants of the institutional weakness of the bloc Moreover

as Monica Hirst has put it lsquothe importance of the South American economies as a space for

a larger expansion of the Brazilian companies and the statersquos presence as an investor

(Petrobras) and financier (BNDES) [Brazilian Development Bank] became more

important for Brazilian material and strategic interests that the regional integration

process especially the Mercosurrsquo12 In short ambiguous perceptions coexisted in

Argentina with fluctuating bilateral relations The setting was propitious for the

reappearance of anti-Brazil perceptions in Argentina The pro-Brazilian episodic euphoria

of the years of Duhalde (Brazil as a lsquogreat strategic allyrsquo) turned into doubt and criticism in

the second phase which goes from the beginning of 2004 to the end of 2006 Explicitly

and implicitly by both the Right and the Left an ambivalent feeling towards Brazil

unfolded albeit without the pugnacity of the past but nevertheless highlighting the

difficulties of embedding a culture of friendship between the two countries13

As in other debates in Argentina these visions were remnants of perceptions forged in

the seventies and nineties Kirchnerrsquos own ambiguities style and measures in government

did not help to build a more positive image of the role of Brazil for Argentina Several

groups located in the Ministry of Foreign Affairs the business world think-tanks and the

media encouraged the counterbalancing of Brazil in lsquoSouth Americarsquo by means of a

Dow

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02

37 0

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ovem

ber

2014

Journal of Iberian and Latin American Research 257

lsquoLatin-Americanrsquo policy in which the role of Mexico was presented as crucial On the

other hand the vision of Chile as a partner for a more balanced South America and as an

economic model also regained strength in a wide spectrum of the Argentine elites covering

the Right to the centre-Left Chilersquos image was contrasted with that of Brazil The first was

seen essentially as lsquopredictablersquo and lsquoreasonablersquo while the second after the triumph of

Lularsquos Workers Party tended to be presented on the opposite side For some closer

relations with Chile would serve to offset the influence of Brazil in the Southern Cone ndash a

Santiago ndash Buenos Aires axis to limit the Brazilian aspiration to lead the area ndash while

others perceived the lsquoChilean wayrsquo as the best manner for taking a safe distance from

Mercosur which was perceived as an obstacle to establishing a flexible dense and fruitful

relationship with the rest of the world Finally the Left identified the relationship with

Venezuela as a balancing factor for restraining the power of Brazil

The third phase of Argentine ndash Brazilian relations started at the end of 2006 and

extends to the present An interesting twist can be observed in the direction of a more

positive perception of Brazil that clearly puts it in a central place for Argentina Two main

factors explain this change The first and most important is the growing international

relevance and regional weight of Brazil This process has led to the formation of a

widespread perception in Argentina that defines Brazil as lsquoinevitablersquo with a predominant

negative and generally pessimistic bias or as a country that is lsquoindispensablersquo in this case

emphasizing the possibility of building a common future and a strong cooperative

relationship The idea of Brazil as a necessary country is widely accepted but has

variously been accepted with resignation disgust and joy alternatively viewed as an

opportunity or severe challenge The lsquosuccessrsquo of Brazil is often contrasted with the

lsquofailuresrsquo of Argentina and generates different feelings such as pain envy nostalgia and

desire for emulation In any case the growth and rise of Brazil has converted it into a

model for almost everyone The second factor is the growing density of bilateral relations

As an example it is interesting to note that Brazil is already the fourth largest foreign

investor in Argentina after the United States Spain and China In 2010 24 of total

exports (42 industrial) and 82 of the cars manufactured in Argentina were directed to

the Brazilian market and 863492 Brazilian tourists visited the country14 At the same

time the expansion of Brazilian companies in Argentinarsquos productive activity and trade

has been impressive in the last decade

The main issue for the future then is how to live and interact with the lsquoinevitablersquo or

lsquoindispensablersquo country This convergence of perceptions regarding the centrality of Brazil

for Argentina only goes so far There is no agreement on the political economic and

strategic interests that should constitute the relationship with Brazil and consequently

about the best ways to put them into practice The transition from an entrenched culture of

rivalry to an incipient culture of friendship has lasted more than a quarter of a century

providing promising dividends for both nations and offering a good platform from which

to renegotiate the growing bilateral ties The world and the region and the national

situation of the two countries especially concerning the distribution of attributes of

economic power are now very different to the 1980s when the two countries took the first

steps to build a positive bilateral relationship The double condition of the Argentine ndash

Brazilian relationship that is its increasingly close and uneven character suggests that

there will be a complex combination of convergence and divergence between the two

nations Argentina and Brazil never were Pakistan and India in terms of antagonism and

sought in the past to jointly become an equivalent to the Franco ndash German axis for the

integration of South America an aspiration that today is unsustainable Circumstances

have changed and the condition of lsquoasymmetric interdependencersquo is recognized and

Dow

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ovem

ber

2014

258 R Russell and J G Tokatlian

accepted in Argentina although not without the suspicions that characterize the attitudes

of the weaker party in a bilateral relationship In this context the main challenge for

Brasilia and Buenos Aires is to forge a realistic and positive lsquonew dealrsquo that contemplates

with its own specificity the bilateral relationship as well as Mercosur

In the end the above-mentioned three phases show the existence of both a changing

and intricate relationship If the theory of asymmetry is taken into consideration the first

move towards re-negotiating an unbalanced relationship should be initiated to a large

extent by the less powerful party In that sense it is yet unclear what the Argentine elites

(civilian and military economic and intellectual state-based and non-governmental) want

from relations with the continent (including the United States) the Spanish-speaking

region South America and finally Brazil Historically it has been quite difficult for

Argentines to have simultaneous positive relations with Washington and Brasilia In the

last two decades different opinions (sometimes personal more than collective) between

the lsquoLatin-Americanistsrsquo and the lsquoSouth-Americanistsrsquo favouring opposite strategic

options have been vocally expressed Currently several other countries in the area have

been increasing their leverage especially those facing the Pacific This phenomenon does

not go unnoticed by Argentine elites and is another source of domestic debate In this

dynamic and changing regional context Argentina has not been able to clearly establish

the goals and ambitions to guide its foreign policy towards the region and Brazil in

particular The response to this situation should be sought in essence in domestic politics

Relations with China (and Asia) A Historic and Challenging Opportunity

Argentine ndash Chinese links should be placed in the larger context of China ndashLatin America

relations15 From a Latin American perspective Chinarsquos growing presence in the region

has been seen at least in the first decade of the twenty-first century as a promising trend

Chinarsquos ties with Latin America from the 1950s to the 1970s were marginal focused

primarily on cultural diplomacy driven by ideological motives and based on

revolutionary rhetoric This diplomatic strategy relied on the dividends of destabilization

was accompanied by anti-US slogans and was geared toward strengthening pro-Chinese

(and anti-Soviet) political parties and movements Chinarsquos international behaviour during

that period was that of a revisionist actor who sought to change the rules of the game

through aggressive means

In contrast Beijingrsquos approach to the region since the 1990s has involved an active

economic diplomacy characterized by pragmatism conciliation and stability Chinarsquos key

goal and main challenge has been to deepen its relations with the countries of Latin America

without irritating Washington Diplomatically China has proceeded in a judicious fashion

which explains in part why regional forces did not emerge to veto a policy of prudent and

consistent engagement toward China In addition Chinarsquos external diplomatic model has

been seductive to Latin America especially during the two administrations of George

W Bush in the United States multipolarism as opposed to unipolarism multilateralism as

opposed to unilateralism non-interference as opposed to interventionism soft power as

opposed to hard power pragmatism as opposed to ideologisation collaboration as opposed

to domination and persuasion as opposed to coercion All have been attractive notions in

Latin America Chinarsquos contemporary approach coincides with strong Latin American

traditions and aspirations and has become more captivating by virtue of the mishandling

disregard and thoughtlessness of US foreign policy towards the region

Nothing indicates that Latin America is geared towards accepting a paternalistic

externally-induced security dilemma with China and the region does not feel insecure visshy

Dow

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ovem

ber

2014

Journal of Iberian and Latin American Research 259

a-vis Beijing despite certain ideologically-driven pressure groups in Washington

Moreover the Sino ndash Latin American ndash US triangular relationship has not engendered

major tensions or unmanageable challenges16 There is also nothing to suggest from a

regional viewpoint that Latin America ndash China ndash United States relations are destined to an

apocalyptic geopolitics approach based on an overblown fear of an alleged Chinese

takeover of the region China is not the Soviet Union post 911 is not a rehearsal of the

Cold War Washington is no longer at the pinnacle of world power and Latin America has

not collapsed after the Western economic and financial crisis began in 2008 There is also

no indication that Chinarsquos intention is to challenge the United States in the Western

Hemisphere In fact the Chinese government has actively sought to convince the United

States and the rest of the world that its intentions are benign thus the self-portrayal of a

peaceful rise

Chinarsquos behaviour in Latin America at the outset of the twenty-first century has been

far from that of a revisionist power On the one hand Beijingrsquos strategy has combined

necessity with opportunity and has been put into practice cautiously and diligently

curtailing the likelihood that the region will develop or adopt a policy aimed at rolling

back Chinarsquos presence On the other hand Latin Americarsquos relationship with Beijing is

more dependent on economic facts than political conceptions As there is no major

ideological concern in most countries about dealing with China the crucial element is the

material effect of Sino ndash Latin American linkages the level of dependency of the region

vis-a-vis China the degree of de-industrialization of the area derived from bilateral trade

and the ecological consequences of Chinese investment in Latin America17

This broader framework is essential to understand the dynamics of Argentinarsquos

relations with China in the larger context of Argentinendash Asian links Over the past two

decades the (re)emergence of China and the ascent of Asia have been a blessing for

Argentina Rising demand and higher prices for commodities have made it possible for

Argentina to elevate and diversify its trade flows with the East Since the 1990s and

despite the discernible differences in economic and foreign policies between Carlos

Menem and the Kirchners Argentina has developed a new pattern of production that has

led notwithstanding the crisis of 2001 to a reorganization of the economic base of the

country As noted by Pablo Gerchunoff lsquoIt is not just about the speed of exports there is

also a significant diversification traditional agriculture new agriculture industry energy

and mining concurred to modify the national economic landscapersquo18 In that context and

according to President Nestor Kirchner it was crucial lsquothrough China to search in Asia the

leverage to re-industrialize Argentinarsquo Economy not politics has been the driving force

to improve and extend Argentine relations with the East19

For the first time in more than seven decades Argentina has met a world that eagerly

requires what it produces The key driver of this demand is located in China but covers a

wide range of countries At present China is Argentinarsquos second largest trading partner

both in terms of the origin of imports and recipient of exports ndash in both dimensions after

Brazil and before the United States (See Table 1) Argentina meanwhile ranks third in the

list of the 15 major suppliers of agricultural products which supplied 90 per cent of

Chinese imports in 2010 United States (244) Brazil (136) and Argentina (73)

Other major suppliers were the European Union (6) Australia (5) and Malaysia (5)

By 2001 Argentine exports to China surpassed the US$1 billion barrier to hit US$1123

billion and imports totalled US$1066 billion Thus there was a small surplus of US$56

million in favour of Argentina By 2010 the commercial exchange was worth US$13795

billion totalling US$6117 billion in Argentine exports and US$7678 billion in Chinese

exports The result was a trade balance of US$1561 billion in Chinarsquos favour20 In the

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260 R Russell and J G Tokatlian

period January ndashSeptember 2011 the surplus in favour of China grew While Argentine

exports amounted to US$4746 billion Chinese exports came to US$7569 billion21

India is Argentinarsquos main Asian trading partner after China22 Other important

countries are Indonesia South Korea Malaysia Vietnam and Thailand23 By 2010 when

China implemented barriers to Argentine soybean oil in retaliation for local action that

prevented the entry of Chinese products into the country Argentina reoriented its soybean

exports to India which bought 14 million tons of soybean oil (corresponding to US$12

billion dollars) In September 2011 Indiarsquos ambassador in Argentina said his country

would increase demand for soybean oil over the next ten years from the current 8 million

to 15 million tons representing a significant additional opportunity for Argentine

producers and exporters24

Indeed ties with Asia are not limited to trade Again the paradigmatic case of this

new relationship is China which in recent years has also emerged as an increasingly

important financial actor During 2009 at a high point of the US-originated financial

crisis China and Argentina agreed to swap US$10 billion worth of their currencies in

order to enable Argentina to avoid using dollars in trade between both countries an

agreement that was the first of this sort between China and a South American country25

Beijing simultaneously accelerated its investment in agriculture mining energy and

banking and has become the third largest investor in the country (See Table 2)26 In

addition there is strong Chinese interest for participation in infrastructure development

projects in sectors such as railways roads ports and telecommunications The largest

food company in China Heilonjiang Beida-Huang signed an October 2010 cooperation

agreement with the province of Rıo Negro27 which provides China with twenty-year

leases on provincial lands (20000 hectares at an early stage that may eventually extend

to up to 320000 hectares)28 In return the Chinese company is committed to

undertaking major irrigation and infrastructure works as part of a ten-year investment of

US$15 billion dollars29 Different actors from Argentina are also opening trade offices

in Chinese cities and several twin cities and sister provinces have signed different 30agreements

In the oil sector the China National Offshore Oil Corporation (CNOOC) acquired 50

per cent of Bridas Corporation and Sinopec holds 100 per cent of Argentine assets in

Occidental In addition China controls 50 per cent of the Cerro Dragon field and will

handle major reserves for 40 years in the province of Santa Cruz To sum up Beijingrsquos

growing interest in Argentina has meant that the country is according to Levi J Jordan

from the Americas Society lsquoreceiving almost half of Chinarsquos investment in South America

over the past two yearsrsquo31 In that context the growth of Chinarsquos state corporations is

impressive32 Agreements have also been made in the field of defence the most prominent

is the signing of the Memorandum of Understanding for Strengthening Exchanges and

Cooperation in Defense of 16 May 2007 whereby both countries have committed to

maintain contacts to discuss global and regional security issues to cooperate on military

equipment and logistics and to establish a Defence Joint Commission It is worth

mentioning that officers from Argentina together with military from Chile and Colombia

frequently (more often than counterparts from Cuba and Venezuela) have attended courses

on grand strategy at Beijingrsquos elite national defence university PLANDU33 Even though

Argentina is not a significant South American buyer of military equipment34 has a very

low annual defence budget and that China is not the major supplier of arms to the region

(as it is the case of the United States Russia and the European Union) it has lately

considered the acquisition of Chinese Z-11 helicopters35 Finally after a July 2012 visit to

China by Argentine Defence Minister Arturo Puricelli both countries agreed that

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2014

Journal of Iberian and Latin American Research 261

Argentina will construct a prototype of that helicopter by 201336 In general the level of

bilateral military dialogue is highly positive37

In key scientific and technological areas there has been an on-going improvement of

relations For example a Satellite Laser Raging (SLR) system designed and made in China

was installed in the Observatory of San Juan University38 Both countries plan to conduct

collaborative activities for Antarctic expedition39 There are many contacts and joint

initiatives in the areas of telecommunications and space40 The two countries are also

interested in creating a Bilateral Centre on Science and Technology for Food41

In addition China will install a satellite station in the province of Neuquen42 while

incrementing its presence in the telecommunications sector and establishing cooperation

ties in the nuclear field43

Argentina and China share important interests in their diplomatic agenda with regards

to the defence of the principle of lsquoterritorial integrityrsquo China consistently supports the

Argentine claim of sovereignty over the MalvinasFalklands while Argentina defends the

policy of lsquoone Chinarsquo which implies the non-recognition of the independence of Taiwan

and Tibet The issue of the MalvinasFalklands Islands has been surfacing for two reasons

On the one hand as Lyle Goldstein has remarked lsquoChinese defence analysts take such

intense interest in the Falkland Warrsquo due to the fact that according to Chinese government

officials and experts there are certain similarities between the Malvinas and Taiwan44 As

Taiwan is a vital issue for Beijing the understanding of the 1982 war in the South Atlantic

is extremely relevant On the other hand the potential closeness of China and Argentina

may provoke in the future a vulnerable situation with regards to the islands that could

affect British defence policy45 In times of a major economic crisis in Europe and with

diminishing possibilities of sustaining high defence budgets retired military officers from

Great Britain overemphasize Londonrsquos potential weakness in the South Atlantic

With respect to issues on the global agenda the two countries agree at the level of the

G-20 on the need for greater participation of emerging nations in international financial

organizations as well as the need to implement measures for the avoidance of financial

speculation that causes volatility in the prices of commodities Both countries have been

supporting peacekeeping operations and they both participate militarily in the UN Mission

in Haiti At the International Atomic Energy Agency Beijing and Buenos Aires have been

active in the promotion of non-proliferation

It is important also to mention a relatively new phenomenon in the relation between

Beijing and Buenos Aires namely Chinese immigration to Argentina There are

approximately 120000 Chinese and Chinese-descendants in Argentina mainly in Buenos

Aires46 Their point of origin is mostly Taiwan and Fujian and to a lesser extent Hong

Kong Even though there are no good estimates or different in-depth studies lsquoChinese

immigration to Argentina is assumed to be largely of illegal naturersquo with lsquoremittances an

important flow of capitalrsquo and Argentina being lsquoan intermediate stoprsquo for approximately

half of the Chinese migrants before seeking entry into the United States (mainly) or the

European Union47

To sum up the capabilities willingness and needs of both sides make the relationship

between Argentina and China (and Asia) complementary The East needs raw materials

(energy food and mining) and Argentina needs investments and infrastructure Of course

a link of this nature presents opportunities but also brings risks It has become fashionable

in Argentina to compare the current situation with the golden years of the lsquospecial

relationshiprsquo with Great Britain (and Europe) that was undoubtedly the engine of the great

Argentine take off between 1880 and 1914 It is also noted that the new relationship with

Asia offers great benefits to the neighbouring countries and therefore does not threaten the

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2014

262 R Russell and J G Tokatlian

harmony existing in the sub-region48 While recognizing the historic opportunity offered

to Argentina by the (re)emergence of China and the advancement of several Asian nations

others emphasize the risks especially those coming from China

Within that context it is relevant to mention that the highly optimistic somehow-naive

phase of Chinese ndash Latin American relations is experiencing changes including in

Argentina ndash China relations Most countries in the region and among them Argentina are

slowly moving from a strategy of lsquoreliable engagementrsquo49 to a more mixed strategy based

on a prudent approach that combines strong commercial ties and active damage-control

policies50 Latin American countries are well aware of the importance of key economic

issues and the sensitive security questions that characterize the regionrsquos relations with

China Concerns about de-industrialization via commodity-based export growth (affecting

basically South America) the effect of global lsquocurrency warsrsquo on the region (affecting all

of Latin America) and the impact of a decisive push for rural production within China

(affecting mainly Mexico and Central America) are extremely critical issues from North to

South America

On a broader outlook the fact that the global system is witnessing a period of

uncertainty is generating a new examination of Chinarsquos lsquowin-winrsquo diplomacy51 This is a

time of difficulties that places limits on Beijingrsquos global and regional strategies Not

surprisingly Argentina as well as other countries in Latin America is rethinking its ties

with China under a more nuanced viewpoint The advantages and dividends of more

commercial and financial links with China are superseded by new productive challenges

(for example excessive emphasis on commodities for export) at home and sensible

differences abroad (for example in the case of human rights) Interests and values are now

inextricably intertwined in Argentine ndash Chinese diplomacy In this context the deployment

of a more sophisticated policy vis-a-vis Beijing seems inevitable Necessity more than

willingness is pressing Buenos Aires to design a broader Asian strategy where China will

be a centrepiece but not the only counterpart politically and materially for the country

Looking Ahead

Argentinarsquos foreign policy developed historically from 1880 until the early twenty-first

century around three areas Europe the United States and Latin America especially the

Southern Cone countries Relations with the socialist world particularly with the Soviet

Union for political and commercial reasons were also important in the second half of the

twentieth century but never reached the scale of the other three axes In the decade since

2000 a fourth axis has been added to this traditional pattern with extraordinary strength

and projection the Asia Pacific region dominated by China

Relations with Europe remain important since there are shared interests and values and

a long history of mutual interaction In addition Argentina continues to need European

investments and technology transfers and the EU is still an important trading partner (See

Table 3) But Europe like Japan and the United States is a market in which exports have

shown in the last decade ceilings that are difficult to overcome The most dynamic and

consolidated markets for Argentina are in Latin America and Asia There are also other

developing markets that are growing at a faster pace than the rest of the world and offer

new opportunities for Argentine exports (Australia Canada Russia South Africa and

Turkey) In the next years Europe will focus its attention on domestic issues and other

areas of the world It is unlikely that any significant progress in the relations with

Argentina and Mercosur could be made in the short run A longer-term view suggests that

Dow

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ber

2014

Journal of Iberian and Latin American Research 263

Europe will increasingly lose its relative importance for Argentina and that its historically

privileged position in the countryrsquos foreign relations will be a thing of the past

Argentinarsquos relations with the United States have never been easy Joseph Tulchin

summarizes its nature in the title of his well-known book Argentina and the United States A Conflicted Relationship52 The strategy of lsquocouplingrsquo implemented during the Menem

years was a pragmatic adaptation to the world of the immediate post-Cold War and was

buried as a strategic option for Argentina with the 2001 crisis In the decade of 2000 the

Kirchners went back to the traditional historical pattern that we have called lsquolimited

oppositionrsquo53 This pattern which combines collaboration and disagreement deference

and resistance will continue to guide Argentinarsquos foreign policy toward Washington but

in a framework in which Buenos Airesrsquos concerns about restraining the United States

preponderance and power will tend to decrease Present conditions offer a great lsquoobjectiversquo

opportunity for the development of new areas of selective collaboration between the two

countries at the bilateral and regional levels A new era of relations with the United States

seems to be beginning for the Southern Cone one that is less unequal and perhaps more

cooperative The key challenge for Argentina is coping with a new reality of diminishing

influence of Washington in the sub-region Most of the time power erosion produces two

alternative behaviours adaptation or denial At least for the time being the relative decline

of US hegemony in South America is showing signs of a lsquosoft landingrsquo If this scenario

prevails then Argentina may manage its bilateral relation with the United States in a more

constructive way

In the case of Brazil it seems that we are entering a second long cycle of convergent

views about the place of this country in Argentinarsquos foreign policy54 This cycle may be

compared and opposed to another long period of convergent visions that characterized the

dominant form in which the neighbour country was perceived by the Argentine elites

during most of the twentieth century Today Brazil is defined as a strategic partner while

in the past until the return of both countries to democracy it was seen as a rival As we

have already mentioned the main challenge for Argentina is how to build this strategic

partnership within a framework of growing asymmetry

The link with Argentina although very important does not have today the same value

for Brazil as in the second half of the eighties By contrast the relationship with Brazil is

increasingly relevant for Argentinarsquos foreign relations and one that presents a significant

challenge In the past the relative symmetry between both countries was a constant source

of suspicion and conflict In the future the condition of asymmetric interdependence as a

structural feature of the relationship will not allow for competition but also is no

guarantee of friendship or cooperation Rather it can become a new source of suspicion

distrust and differences Argentina and Brazil will have to learn to live together in this new

reality and develop a broader framework of mutual understanding to manage the major

density of bilateral links and the global issues of common interests The greatest effort

must come from Argentina because it is the country that has a higher interest in the

relationship and more to gain

Finally the emergence of Asia is offering Argentina a unique opportunity for a

dynamic and successful international integration Its most recent economic dynamism is a

direct result of the increased demand from China and other Asian countries for food and

raw materials However Argentinarsquos exports to Asia are highly concentrated in the

soybean complex and to a much smaller extent in a small group of primary and natural

resource intensive products According to the latest ECLAC report five major products

accounted for 92 of total exports from Argentina to China during the years 2007 ndash 2009

(soybean 531 soybean oil 265 crude oil 747 other cattle 248 and meat and

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ber

2014

264 R Russell and J G Tokatlian

poultry offal 233)55 Moreover the trade surplus with China has tended to evaporate

after several years of significant positive balances

This situation raises many questions about the Argentine specialization pattern ndash

beyond issues related to trade with China ndash and the need to reduce an excessive

dependence on the export of commodities Nevertheless as the benefits of trade with

China have been so high and have also enabled Argentina to successfully face and resist

the financial crises in the centres the propensity to do nothing is great As Eric Farnsworth

recently observed lsquoWhen nations are able to sell as much as they can produce of any

particular product the thinking is generally to continue doing so and reap the rewards

When economies are growing there is little political imperative or incentive for reformrsquo56

In consequence a relevant question surrounding this type of relationship is how to avoid

the temptation to inertia The tendency towards passive repetition is appealing The China

lsquochallengersquo in the early twenty-first century for Argentina is how to think and act

differently from what had been the case of Argentine ndash British relations at the beginning of

the twentieth century The framing of a different link with Beijing as well as the positive

handling of an increasingly complex multifaceted multilevel relationship with Brazil

seem to be the major challenges ahead for Argentinarsquos foreign relations

Notes 1 Roberto Russell and Juan G Tokatlian El lugar de Brasil en la polıtica exterior argentina

Buenos Aires Fondo de Cultura Econo mica 2003 pp 45 ndash 59 2 We use the concept lsquosystemic changesrsquo in the same sense as Robert Gilpin See his book War

and Change in World Politics Cambridge Cambridge University Press 1981 pp 42ndash 43 3 For an interesting analysis of these debates see Jose Paradiso Debates y trayectoria de la

polıtica exterior argentina Buenos Aires Grupo Editor Latinoamericano 1993 4 On the concept lsquoasymmetryrsquo and its implications for bilateral relations see Brantley Womack

lsquoAsymmetry and Systemic Misperception China Vietnam and Cambodia during the 1970rsquosrsquo Journal of Strategic Studies 262 June 2003 pp 92ndash 119

5 On structural and relational power see Susan Strange States and Markets An Introduction to International Political Economy London Pinter 1988 pp 25ndash9

6 David C Kang lsquoThe theoretical roots of hierarchy in international relationsrsquo Australian Journal of International Affairs 583 September 2004 p 339

7 Roberto Russell and Juan G Tokatlian lsquoBeyond Orthodoxy Asserting Latin Americarsquos New Strategic Options Toward the United Statesrsquo Latin America Politics and Society 533 Winter 2011 pp 129 ndash 134

8 Eric Hobsbawm lsquoDespues del siglo XX un mundo en transicionrsquo in Ricardo Lagos (ed) America Latina iquestintegracion o fragmentacion Buenos Aires Edhasa 2008 pp 29ndash 47

9 Remarks by the President of the Argentine Republic Nestor Kirchner at the inauguration of the IV Summit of the Americas Mar del Plata httpwwwsummit-ameicasorgDocuments 20del20presidente20de20RepC3BAblica20Argentinapdf

10 La Nacion (Buenos Aires) lsquoCristina Kirchner critico a Obama con duros terminosrsquo 26 February 2010 Available at httpwwwlanacioncomar1237368-cristina-kirchner-criticoshya-obama-con-duros-terminos accessed 17 November 2011

11 For more in depth analysis of the bilateral relations see Russell and Tokatlian El lugar de Brasil pp 45ndash59 and Roberto Russell and Juan G Tokatlian lsquoPercepcoes argentinas sobre o Brasil ambivalencias e expectativasrsquo Polıtica Externa 202 September 2011 pp 43ndash 56

12 Monica Hirst lsquoLa polıtica sudamericana de Brasil entre el peso de las asimetrıas y la incidencia de nuevas coyunturasrsquo in F Calderon (ed) Escenarios polıticos en America Latina Conceptos metodos y Observatorio Regional Cuadernos de Gobernabilidad Democratica 2 Buenos Aires PNUD Siglo XXI 2008 p 257

13 We use the concept of friendship following Alexander Wendt Social Theory of International Politics Cambridge Cambridge UP 1999 pp 297ndash 308

14 La Nacion Economıa y Negocios Buenos Aires lsquoBrasil en la vida cotidiana argentinarsquo 22 May 2011 p 1

Dow

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ber

2014

Journal of Iberian and Latin American Research 265

15 On China ndash Latin America relations at the beginning of the XXI Century see Juan G Tokatlian lsquoA view from Latin Americarsquo in R Roett and G Paz (eds) Chinarsquos Expansion into the Western Hemisphere Implications for Latin America and the United States Washington DC Brookings Institution Press 2008

16 According toMark P Sullivan a specialist on Latin American affairs at theUS Congressional Research Service lsquoThe balance of opinion toward China and the United States in Latin America tend to be roughly comparable according to a (2007) Pew study Two exceptions are Argentina where China is viewed much more favorably than the United States and in Mexico where the United States is viewed much more favorably than Chinarsquo See Thomas Lum (ed) lsquoComparing Global Influence China and US Diplomacy Foreign Aid Trade and Investment in the Developing Worldrsquo in CRS Report to Congress August 15 2008

17 Kevin Gallagher lsquoLatin Americarsquos China challengersquo 2011 Policy Innovations httpwwwase tuftsedugdaePubsrpGallagher_PolicyInnovationsJan11pdf accessed 18 November 2011

18 Pablo Gerchunoff 2010 lsquoCausas y azares en mas de un siglo de historia econo mica argentinarsquo in R Russell (ed) Argentina 1910ndash2010 Balance de un siglo Buenos Aires Taurus p 152

19 See the complete quote in Sergio Cesarin lsquoChina y Argentina Enfoques y recomendaciones para potenciar la relacion bilateralrsquo Serie Aportes 2010 httplibraryfesdepdf-filesbueros argentinien07560pdf accessed 28 November 2011

20 Based on INDEC 2011 and Comercio Exterior Argentino 2010 httpwwwindecgovar accessed 13 November 2011

21 Camara de Exportadores de la Republica Argentina En Contcto China No 43 November 2011 p 16

22 In October 2009 President Cristina Fernandez de Kirchner visited India It was her first trip to an Asian country after her inauguration in December 2007 and it was the first visit of an Argentine president to India since 1994

23 It is important to mention the cases of Indonesia and Vietnam for two reasons the growth of trade in the last decade and the fact Argentine exports to these two countries are mainly nonshytraditional commodities For example exports to Indonesia jumped fromUS$43million in 2001 to US$852 million in 2010 while exports to Vietnam grew from US$60 million in 2001 to US $654 million in 2010 Cların iEco Buenos Aires lsquoArgentina en mas puertosrsquo 28 August 2011

24 La Nacion Economıa y Negocios Buenos Aires lsquoLa soja argentina ahora apunta a la Indiarsquo 15 September 2011 p 3

25 China Daily lsquoArgentina China sign tentative swap dealrsquo 31 March 2009 httpwww chinadailycomcnchina2009-0331content_7635007htm accessed 11 November 2011

26 Argenpress (Buenos Aires) lsquoInversiones chinas en la Argentina Claves del nuevo escenario energeticorsquo 14 June 2011 httpwwwargenpressinfo201106inversiones-chinas-enshyargentina-claveshtml accessed 19 November 2011

27 See text of the agreement at httpwwwgrrorgarrionegro-chinaacuerdo-saiz-chinapdf accessed 26 Nov 2011 and El Cronista Buenos Aires lsquoChina invierte 1500 millones en Rıo Negro para asegurarse alimentosrsquo 9 June 2011 httpwwwcronistacomnegocios China-invierte-us-1500-millones-en-Rio-Negro-para-asegurarse-alimentos-20110609-0033 html accessed 19 November 2011

28 On other actual and potential Chinese investments in Argentine provinces see Camara Argentino China Negocios con China 2011 httpwwwargenchinaorgarticulos_2010 NegociosConChinapdf accessed 14 November 2011 and FUNDAMIN lsquoChina invierte en las 23 provincias argentinasrsquo httpfundamincomaresinfo36-exportaciones-e-importaciones 299-china-invierte-en-las-23-provincias-argentinashtml accessed 19 November 2011

29 httpwwwnoalaminaorgmineria-informacion-generalgeneralargentina-china-recreacionshyde-la-vieja-qrelacion-especialq-con-gran-bretana accessed 20 January 2012

30 lsquoLas relaciones entre China y Argentinarsquo httpespanolcricn1161201211281s264119 htm accessed 17 November 2011

31 lsquoRailway rapprochement China invests in Argentinarsquo 2010 httpwwwas-coaorgarticles 2528Railway_Rapprochement_China_Invests_in_Argentina accessed 17 Nov 2011

32 Silvia Simonit lsquoLas empresas chinas en Argentinarsquo Chinese Studies Working Paper Series (Universitat Pompeu Fabra) No 1 2011

33 Loro Horta lsquoIn Uncle Samrsquos Backyard Chinarsquos Military Influence in Latin Americarsquo Military Review September-October 2008 p 48

Dow

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ovem

ber

2014

266 R Russell and J G Tokatlian

34 As are the cases of Brazil Chile Colombia and Venezuela 35 Seguridad y Defensa lsquoEl Ejercito Negocia con China la compra de helico pterosrsquo 10 October

2010 httpwwwseguridadydefensacomarnoticiasejercito-negocia-con-china-la-comprashyde-helicopteros-25059html accessed 10 November 2011

36 httpwwwelmetroonlinecomarindexphpoption frac14com_k2ampviewfrac14 itemampidfrac141067 purishycelli-firmC3B3-convenio-de-defensa-con-chinaampItemid frac14238 accessed 12 September 2012

37 China Military Online lsquoChang Wanquan holds talks with Argentine deputy Defense ministerrsquo 28 November 2011 httpengchinamilcomcnnews-channelschina-militaryshynews2011-1128content_4725893htm accessed 29 November 2011

38 T Wang et lsquoNew SRL station running in San Juan of Argentinarsquo Crustal Dynamics Data Information System nd httpcddisgsfcnasagovlw15docspapersNew20SLR20Station 20Running20in20San20Juan20of20Argentinapdf accessed 9 November 2011

39 Chinese Academy of Sciences lsquoChina Argentina to strengthen cooperation on Antarctic expeditionrsquo 16 August 2010 httpenglishbiccascnNE201008t20100816_57510html accessed 29 November 2011

40 Janie Hulse lsquoChinarsquos Expansion into and US withdrawal from Argentinarsquos telecommunicashytions and space industries and the implications for US national securityrsquo Strategic Studies Institute September 2007 httpwwwstrategicstudiesinstitutearmymilpdffilespub806pdf accessed 7 November 2011

41 Ministry of Science and Technology lsquoChina y la Argentina se reu nen para desarrollar un Centro Binacionalrsquo 2011 httpwwwmincytgovaragendaagenda_detalle phpid_ agendafrac1435 accessed 16 November 2011

42 httpwwwlmneuquencomarnoticias201282avanza-instalacion-de-una-estacion-satel ital-de-china-en-la-provincia_156999 accessed 14 October 2012

43 httpwwwstrategicstudiesinstitutearmymilpubssummarycfmqfrac14 806 accessed 29 November 2011 httpenergyseenewscomnewsargentina-china-sign-nuclear-coop eration-agreement-306141 accessed 3 November 2012

44 For the major reasons that motivated this interest see Lyle Goldstein lsquoChinarsquos Falklands Lessonsrsquo Survival 503 2008 pp 65-66

45 UKNDA Inconvenient Truths Threats Justify Prioritising Defence London UKNDA 2011 p 24

46 La Nacion Buenos Aires lsquoVivir en la Argentina estudiar en Chinarsquo 11 October 2011 http wwwlanacioncomar1413556-vivir-en-la-argentina-estudiar-en-china accessed 9 Novemshyber 2011

47 G M Calderon lsquoInmigracion china en las Americas Comparacion de las experiencias en Canada y Argentinarsquo Revista Argentina de Estudios Canadienses No 2 2008 p 30

48 La Nacion Buenos Aires lsquoChina Una oportunidad histo ricarsquo 26 July 2011 49 Juan Tokatlian lsquoLatin America China and the United States A Hopeful Trianglersquo 2007

Open Democracy httpwwwopendemocracynetdemocracy-protesthopeful_triangle_ 4336jsp accessed 4 November 2011

50 La Nacion Buenos Aires lsquoUna nueva estrategia hacia Chinarsquo 29 August 2011 51 Brantley Womack lsquoBeyond Win-Win Rethinking International Relationships in an Era of

Economic Uncertaintyrsquo Paper presented to the International Conference on the Chinese Models of Development Domestic and Global Aspects Taipei Taiwan September 2011

52 Joseph Tulchin Argentina and the United States A Conflicted Relationship New York Macmillan 1990

53 Russell and Tokatlian lsquoBeyond Orthodoxyrsquo 54 According to the latest report of Latinobaro metro 52 of the Argentines consider Brazil as

the main leader of Latin America while only 2 gives that condition to the United States http wwwlatinobarometroorglatinoLATContenidosjsp accessed 23 November 2011

55 Osvaldo Rosales lsquoLa Republica Popular China y America Latina y el Caribe Hacia una nueva fase en el vınculo econo mico comercialrsquo 2011 ECLAC httpwwweclacorgpubl icacionesxml643666La_Republica_Popular _China_y_America_Latina_y_el_Caribe _ tradepdf accessed 10 November 2011

56 Eric Farnsworth 2011 lsquoThe New Mercantilism Chinarsquos Emerging Role in the Americasrsquo Current History February Available at httpwwwas coaorgarticles2982The_New_shyMercantilism_Chinas_Emerging_Role_in_the_Americas accessed 28 November 2011

Dow

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ovem

ber

2014

Journal of Iberian and Latin American Research 267

Appendix 1

Table 1

Argentinean trade with Brazil in millions of dollars 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Exports 6206 4828 4666 5587 6335 8141 10498 13272 11374 14420 Imports 5230 2517 4700 7567 10187 11749 14523 17687 11822 17658 Trade 975 2310 233 21980 23852 23608 24025 24415 2448 23238 balance

Argentinean trade with the United States in millions of dollars 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Exports 2840 2869 3364 3733 4493 4025 4153 5095 3465 3656 Imports 3737 1789 2238 3389 3998 4247 5264 6894 5106 6125 Trade 2897 1080 1126 344 495 2222 21111 21799 21641 22469 balance

Argentinean trade with China in millions of dollars 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Exports 1123 1092 2483 2628 3193 3476 5170 6355 3668 6117 Imports 1066 330 721 1402 2237 3122 5093 7104 4823 7678 Trade 56 762 1762 1227 956 354 77 2 749 2 1155 2 1561 balance

Source INDEC and UNCTAD

Table 2

FDI stock in Argentina by country of origin in millions of dollars (selected countries) 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

USA 16422 7476 7989 10277 11689 12208 13601 13930 14012 14814 of total 238 231 208 182 187 176 175 172 175 168

Brazil 1953 2108 3280 1773 2488 2810 3659 4969 4319 5367 of total 283 651 856 314 397 406 470 614 539 608

China no data no data no data 13 11 45 120 141 123 5500 of total no data no data no data 002 002 006 015 017 015 623

Total 68935 32403 38323 56554 62639 69292 77899 80941 80144 88249

for the years 2001 2002 and 2003 the data for Brazil includes all FDI from South America excluding ChileFrom 2003 onwards the data is exclusively for BrazilSource INDEC and UNCTAD

Table 3

Argentinean trade with the European Union in millions of dollars 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Exports 4698 5309 6079 6209 6844 8010 9901 13173 10278 11026 Imports 4717 2107 2814 4237 4830 5811 7442 9043 6434 7587 Trade 219 3201 3265 1972 2013 2199 2458 4130 3845 3439 balance

FDI from the European Union in Argentina in millions of dollars 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

FDI 38279 18284 21273 33001 36848 40408 45159 45070 44963 47605 of total 5553 5643 5551 5835 5883 5832 5797 5568 5610 5394 Total 68935 32403 38323 56554 62639 69292 77899 80941 80144 88249

Source INDEC and UNCTAD

Dow

nloa

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  • Abstract
  • The United States and Brazil Losing and Gaining Centrality
  • Relations with China (and Asia) A Historic and Challenging Opportunity
  • Looking Ahead
  • Notes
  • Appendix
Page 7: Implications of the Global and Regional Changes for Argentina's Foreign Relations

256 R Russell and J G Tokatlian

recovery came the revival in Argentina of an ambiguity vis-a-vis Brazil Although

Brazil was seen as a key player and partner it also raised suspicions and doubts

throughout the whole Argentine political spectrum Its status as an emerging power

produced concerns For the Right in Argentina the Lula presidency gave reasons to

refloat the perception of Brazil as an lsquoincorrigiblersquo country The different assessments of

the strategic condition of South America vis-a-vis Latin America also reappeared and with it

fears of a possible Brazilian hegemony in South America The government of Fernando de la

Rua (1999ndash2001) had had a preventive and defensive attitude about the political idea of South

America proposed by Brazil ndash a political and economic geographic area with its own

peculiarities and different from the lsquoLatin America of the Northrsquo The government of Nestor

Kirchner also adopted a reluctant position An eloquent example of this attitudewas President

Kirchnerrsquos decision not to attend the gestation of the South American Community of Nations

meeting (prior to its transformation into the Union of SouthAmericanNations) in 2004 on the

grounds that it was an instrument created by Brazil to project and ensure its own power in

the region

References to Brazil arose in the context of a stagnating Mercosur Repeated promises

to give the bloc a new birth ndash the so called lsquorelanzamientorsquo ndash could not hide that in terms

of its economic significance Mercosur exhibited clear signs of exhaustion Moreover

similar views in both capitals about the lsquodevelopment modelrsquo did not help to give more

oxygen to the integration process The convergence between Kirchner and Lula on the

need to restore the lsquoindustrialistrsquo vision of integration as opposed to the lsquocommercialrsquo

approach of the nineties gave the impression that the two countries were ready to give its

ties a new strategic perspective However the bilateral agenda of lsquoproductiversquo integration

and Brasiliarsquos acceptance of the importance of the lsquore-industrializationrsquo of Argentina were

interpreted in Buenos Aires as a right to establish protectionist measures for Brazilian

exports that threatened the national industry and even more to ignore certain rules This

propensity for defensive policies not only emphasized the lsquofatiguersquo of Mercosur but also

contributed to the low willingness on the part of Brasilia to accept limits to the

autonomous management of its foreign policy Integration never ceased to be a goal for

Brazil but with time acquired a minor role in the priorities of its foreign policy Its

systematic rejection of a surrender of elements of sovereignty and autonomy to the

Mercosur was one of the determinants of the institutional weakness of the bloc Moreover

as Monica Hirst has put it lsquothe importance of the South American economies as a space for

a larger expansion of the Brazilian companies and the statersquos presence as an investor

(Petrobras) and financier (BNDES) [Brazilian Development Bank] became more

important for Brazilian material and strategic interests that the regional integration

process especially the Mercosurrsquo12 In short ambiguous perceptions coexisted in

Argentina with fluctuating bilateral relations The setting was propitious for the

reappearance of anti-Brazil perceptions in Argentina The pro-Brazilian episodic euphoria

of the years of Duhalde (Brazil as a lsquogreat strategic allyrsquo) turned into doubt and criticism in

the second phase which goes from the beginning of 2004 to the end of 2006 Explicitly

and implicitly by both the Right and the Left an ambivalent feeling towards Brazil

unfolded albeit without the pugnacity of the past but nevertheless highlighting the

difficulties of embedding a culture of friendship between the two countries13

As in other debates in Argentina these visions were remnants of perceptions forged in

the seventies and nineties Kirchnerrsquos own ambiguities style and measures in government

did not help to build a more positive image of the role of Brazil for Argentina Several

groups located in the Ministry of Foreign Affairs the business world think-tanks and the

media encouraged the counterbalancing of Brazil in lsquoSouth Americarsquo by means of a

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Journal of Iberian and Latin American Research 257

lsquoLatin-Americanrsquo policy in which the role of Mexico was presented as crucial On the

other hand the vision of Chile as a partner for a more balanced South America and as an

economic model also regained strength in a wide spectrum of the Argentine elites covering

the Right to the centre-Left Chilersquos image was contrasted with that of Brazil The first was

seen essentially as lsquopredictablersquo and lsquoreasonablersquo while the second after the triumph of

Lularsquos Workers Party tended to be presented on the opposite side For some closer

relations with Chile would serve to offset the influence of Brazil in the Southern Cone ndash a

Santiago ndash Buenos Aires axis to limit the Brazilian aspiration to lead the area ndash while

others perceived the lsquoChilean wayrsquo as the best manner for taking a safe distance from

Mercosur which was perceived as an obstacle to establishing a flexible dense and fruitful

relationship with the rest of the world Finally the Left identified the relationship with

Venezuela as a balancing factor for restraining the power of Brazil

The third phase of Argentine ndash Brazilian relations started at the end of 2006 and

extends to the present An interesting twist can be observed in the direction of a more

positive perception of Brazil that clearly puts it in a central place for Argentina Two main

factors explain this change The first and most important is the growing international

relevance and regional weight of Brazil This process has led to the formation of a

widespread perception in Argentina that defines Brazil as lsquoinevitablersquo with a predominant

negative and generally pessimistic bias or as a country that is lsquoindispensablersquo in this case

emphasizing the possibility of building a common future and a strong cooperative

relationship The idea of Brazil as a necessary country is widely accepted but has

variously been accepted with resignation disgust and joy alternatively viewed as an

opportunity or severe challenge The lsquosuccessrsquo of Brazil is often contrasted with the

lsquofailuresrsquo of Argentina and generates different feelings such as pain envy nostalgia and

desire for emulation In any case the growth and rise of Brazil has converted it into a

model for almost everyone The second factor is the growing density of bilateral relations

As an example it is interesting to note that Brazil is already the fourth largest foreign

investor in Argentina after the United States Spain and China In 2010 24 of total

exports (42 industrial) and 82 of the cars manufactured in Argentina were directed to

the Brazilian market and 863492 Brazilian tourists visited the country14 At the same

time the expansion of Brazilian companies in Argentinarsquos productive activity and trade

has been impressive in the last decade

The main issue for the future then is how to live and interact with the lsquoinevitablersquo or

lsquoindispensablersquo country This convergence of perceptions regarding the centrality of Brazil

for Argentina only goes so far There is no agreement on the political economic and

strategic interests that should constitute the relationship with Brazil and consequently

about the best ways to put them into practice The transition from an entrenched culture of

rivalry to an incipient culture of friendship has lasted more than a quarter of a century

providing promising dividends for both nations and offering a good platform from which

to renegotiate the growing bilateral ties The world and the region and the national

situation of the two countries especially concerning the distribution of attributes of

economic power are now very different to the 1980s when the two countries took the first

steps to build a positive bilateral relationship The double condition of the Argentine ndash

Brazilian relationship that is its increasingly close and uneven character suggests that

there will be a complex combination of convergence and divergence between the two

nations Argentina and Brazil never were Pakistan and India in terms of antagonism and

sought in the past to jointly become an equivalent to the Franco ndash German axis for the

integration of South America an aspiration that today is unsustainable Circumstances

have changed and the condition of lsquoasymmetric interdependencersquo is recognized and

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258 R Russell and J G Tokatlian

accepted in Argentina although not without the suspicions that characterize the attitudes

of the weaker party in a bilateral relationship In this context the main challenge for

Brasilia and Buenos Aires is to forge a realistic and positive lsquonew dealrsquo that contemplates

with its own specificity the bilateral relationship as well as Mercosur

In the end the above-mentioned three phases show the existence of both a changing

and intricate relationship If the theory of asymmetry is taken into consideration the first

move towards re-negotiating an unbalanced relationship should be initiated to a large

extent by the less powerful party In that sense it is yet unclear what the Argentine elites

(civilian and military economic and intellectual state-based and non-governmental) want

from relations with the continent (including the United States) the Spanish-speaking

region South America and finally Brazil Historically it has been quite difficult for

Argentines to have simultaneous positive relations with Washington and Brasilia In the

last two decades different opinions (sometimes personal more than collective) between

the lsquoLatin-Americanistsrsquo and the lsquoSouth-Americanistsrsquo favouring opposite strategic

options have been vocally expressed Currently several other countries in the area have

been increasing their leverage especially those facing the Pacific This phenomenon does

not go unnoticed by Argentine elites and is another source of domestic debate In this

dynamic and changing regional context Argentina has not been able to clearly establish

the goals and ambitions to guide its foreign policy towards the region and Brazil in

particular The response to this situation should be sought in essence in domestic politics

Relations with China (and Asia) A Historic and Challenging Opportunity

Argentine ndash Chinese links should be placed in the larger context of China ndashLatin America

relations15 From a Latin American perspective Chinarsquos growing presence in the region

has been seen at least in the first decade of the twenty-first century as a promising trend

Chinarsquos ties with Latin America from the 1950s to the 1970s were marginal focused

primarily on cultural diplomacy driven by ideological motives and based on

revolutionary rhetoric This diplomatic strategy relied on the dividends of destabilization

was accompanied by anti-US slogans and was geared toward strengthening pro-Chinese

(and anti-Soviet) political parties and movements Chinarsquos international behaviour during

that period was that of a revisionist actor who sought to change the rules of the game

through aggressive means

In contrast Beijingrsquos approach to the region since the 1990s has involved an active

economic diplomacy characterized by pragmatism conciliation and stability Chinarsquos key

goal and main challenge has been to deepen its relations with the countries of Latin America

without irritating Washington Diplomatically China has proceeded in a judicious fashion

which explains in part why regional forces did not emerge to veto a policy of prudent and

consistent engagement toward China In addition Chinarsquos external diplomatic model has

been seductive to Latin America especially during the two administrations of George

W Bush in the United States multipolarism as opposed to unipolarism multilateralism as

opposed to unilateralism non-interference as opposed to interventionism soft power as

opposed to hard power pragmatism as opposed to ideologisation collaboration as opposed

to domination and persuasion as opposed to coercion All have been attractive notions in

Latin America Chinarsquos contemporary approach coincides with strong Latin American

traditions and aspirations and has become more captivating by virtue of the mishandling

disregard and thoughtlessness of US foreign policy towards the region

Nothing indicates that Latin America is geared towards accepting a paternalistic

externally-induced security dilemma with China and the region does not feel insecure visshy

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2014

Journal of Iberian and Latin American Research 259

a-vis Beijing despite certain ideologically-driven pressure groups in Washington

Moreover the Sino ndash Latin American ndash US triangular relationship has not engendered

major tensions or unmanageable challenges16 There is also nothing to suggest from a

regional viewpoint that Latin America ndash China ndash United States relations are destined to an

apocalyptic geopolitics approach based on an overblown fear of an alleged Chinese

takeover of the region China is not the Soviet Union post 911 is not a rehearsal of the

Cold War Washington is no longer at the pinnacle of world power and Latin America has

not collapsed after the Western economic and financial crisis began in 2008 There is also

no indication that Chinarsquos intention is to challenge the United States in the Western

Hemisphere In fact the Chinese government has actively sought to convince the United

States and the rest of the world that its intentions are benign thus the self-portrayal of a

peaceful rise

Chinarsquos behaviour in Latin America at the outset of the twenty-first century has been

far from that of a revisionist power On the one hand Beijingrsquos strategy has combined

necessity with opportunity and has been put into practice cautiously and diligently

curtailing the likelihood that the region will develop or adopt a policy aimed at rolling

back Chinarsquos presence On the other hand Latin Americarsquos relationship with Beijing is

more dependent on economic facts than political conceptions As there is no major

ideological concern in most countries about dealing with China the crucial element is the

material effect of Sino ndash Latin American linkages the level of dependency of the region

vis-a-vis China the degree of de-industrialization of the area derived from bilateral trade

and the ecological consequences of Chinese investment in Latin America17

This broader framework is essential to understand the dynamics of Argentinarsquos

relations with China in the larger context of Argentinendash Asian links Over the past two

decades the (re)emergence of China and the ascent of Asia have been a blessing for

Argentina Rising demand and higher prices for commodities have made it possible for

Argentina to elevate and diversify its trade flows with the East Since the 1990s and

despite the discernible differences in economic and foreign policies between Carlos

Menem and the Kirchners Argentina has developed a new pattern of production that has

led notwithstanding the crisis of 2001 to a reorganization of the economic base of the

country As noted by Pablo Gerchunoff lsquoIt is not just about the speed of exports there is

also a significant diversification traditional agriculture new agriculture industry energy

and mining concurred to modify the national economic landscapersquo18 In that context and

according to President Nestor Kirchner it was crucial lsquothrough China to search in Asia the

leverage to re-industrialize Argentinarsquo Economy not politics has been the driving force

to improve and extend Argentine relations with the East19

For the first time in more than seven decades Argentina has met a world that eagerly

requires what it produces The key driver of this demand is located in China but covers a

wide range of countries At present China is Argentinarsquos second largest trading partner

both in terms of the origin of imports and recipient of exports ndash in both dimensions after

Brazil and before the United States (See Table 1) Argentina meanwhile ranks third in the

list of the 15 major suppliers of agricultural products which supplied 90 per cent of

Chinese imports in 2010 United States (244) Brazil (136) and Argentina (73)

Other major suppliers were the European Union (6) Australia (5) and Malaysia (5)

By 2001 Argentine exports to China surpassed the US$1 billion barrier to hit US$1123

billion and imports totalled US$1066 billion Thus there was a small surplus of US$56

million in favour of Argentina By 2010 the commercial exchange was worth US$13795

billion totalling US$6117 billion in Argentine exports and US$7678 billion in Chinese

exports The result was a trade balance of US$1561 billion in Chinarsquos favour20 In the

Dow

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260 R Russell and J G Tokatlian

period January ndashSeptember 2011 the surplus in favour of China grew While Argentine

exports amounted to US$4746 billion Chinese exports came to US$7569 billion21

India is Argentinarsquos main Asian trading partner after China22 Other important

countries are Indonesia South Korea Malaysia Vietnam and Thailand23 By 2010 when

China implemented barriers to Argentine soybean oil in retaliation for local action that

prevented the entry of Chinese products into the country Argentina reoriented its soybean

exports to India which bought 14 million tons of soybean oil (corresponding to US$12

billion dollars) In September 2011 Indiarsquos ambassador in Argentina said his country

would increase demand for soybean oil over the next ten years from the current 8 million

to 15 million tons representing a significant additional opportunity for Argentine

producers and exporters24

Indeed ties with Asia are not limited to trade Again the paradigmatic case of this

new relationship is China which in recent years has also emerged as an increasingly

important financial actor During 2009 at a high point of the US-originated financial

crisis China and Argentina agreed to swap US$10 billion worth of their currencies in

order to enable Argentina to avoid using dollars in trade between both countries an

agreement that was the first of this sort between China and a South American country25

Beijing simultaneously accelerated its investment in agriculture mining energy and

banking and has become the third largest investor in the country (See Table 2)26 In

addition there is strong Chinese interest for participation in infrastructure development

projects in sectors such as railways roads ports and telecommunications The largest

food company in China Heilonjiang Beida-Huang signed an October 2010 cooperation

agreement with the province of Rıo Negro27 which provides China with twenty-year

leases on provincial lands (20000 hectares at an early stage that may eventually extend

to up to 320000 hectares)28 In return the Chinese company is committed to

undertaking major irrigation and infrastructure works as part of a ten-year investment of

US$15 billion dollars29 Different actors from Argentina are also opening trade offices

in Chinese cities and several twin cities and sister provinces have signed different 30agreements

In the oil sector the China National Offshore Oil Corporation (CNOOC) acquired 50

per cent of Bridas Corporation and Sinopec holds 100 per cent of Argentine assets in

Occidental In addition China controls 50 per cent of the Cerro Dragon field and will

handle major reserves for 40 years in the province of Santa Cruz To sum up Beijingrsquos

growing interest in Argentina has meant that the country is according to Levi J Jordan

from the Americas Society lsquoreceiving almost half of Chinarsquos investment in South America

over the past two yearsrsquo31 In that context the growth of Chinarsquos state corporations is

impressive32 Agreements have also been made in the field of defence the most prominent

is the signing of the Memorandum of Understanding for Strengthening Exchanges and

Cooperation in Defense of 16 May 2007 whereby both countries have committed to

maintain contacts to discuss global and regional security issues to cooperate on military

equipment and logistics and to establish a Defence Joint Commission It is worth

mentioning that officers from Argentina together with military from Chile and Colombia

frequently (more often than counterparts from Cuba and Venezuela) have attended courses

on grand strategy at Beijingrsquos elite national defence university PLANDU33 Even though

Argentina is not a significant South American buyer of military equipment34 has a very

low annual defence budget and that China is not the major supplier of arms to the region

(as it is the case of the United States Russia and the European Union) it has lately

considered the acquisition of Chinese Z-11 helicopters35 Finally after a July 2012 visit to

China by Argentine Defence Minister Arturo Puricelli both countries agreed that

Dow

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2014

Journal of Iberian and Latin American Research 261

Argentina will construct a prototype of that helicopter by 201336 In general the level of

bilateral military dialogue is highly positive37

In key scientific and technological areas there has been an on-going improvement of

relations For example a Satellite Laser Raging (SLR) system designed and made in China

was installed in the Observatory of San Juan University38 Both countries plan to conduct

collaborative activities for Antarctic expedition39 There are many contacts and joint

initiatives in the areas of telecommunications and space40 The two countries are also

interested in creating a Bilateral Centre on Science and Technology for Food41

In addition China will install a satellite station in the province of Neuquen42 while

incrementing its presence in the telecommunications sector and establishing cooperation

ties in the nuclear field43

Argentina and China share important interests in their diplomatic agenda with regards

to the defence of the principle of lsquoterritorial integrityrsquo China consistently supports the

Argentine claim of sovereignty over the MalvinasFalklands while Argentina defends the

policy of lsquoone Chinarsquo which implies the non-recognition of the independence of Taiwan

and Tibet The issue of the MalvinasFalklands Islands has been surfacing for two reasons

On the one hand as Lyle Goldstein has remarked lsquoChinese defence analysts take such

intense interest in the Falkland Warrsquo due to the fact that according to Chinese government

officials and experts there are certain similarities between the Malvinas and Taiwan44 As

Taiwan is a vital issue for Beijing the understanding of the 1982 war in the South Atlantic

is extremely relevant On the other hand the potential closeness of China and Argentina

may provoke in the future a vulnerable situation with regards to the islands that could

affect British defence policy45 In times of a major economic crisis in Europe and with

diminishing possibilities of sustaining high defence budgets retired military officers from

Great Britain overemphasize Londonrsquos potential weakness in the South Atlantic

With respect to issues on the global agenda the two countries agree at the level of the

G-20 on the need for greater participation of emerging nations in international financial

organizations as well as the need to implement measures for the avoidance of financial

speculation that causes volatility in the prices of commodities Both countries have been

supporting peacekeeping operations and they both participate militarily in the UN Mission

in Haiti At the International Atomic Energy Agency Beijing and Buenos Aires have been

active in the promotion of non-proliferation

It is important also to mention a relatively new phenomenon in the relation between

Beijing and Buenos Aires namely Chinese immigration to Argentina There are

approximately 120000 Chinese and Chinese-descendants in Argentina mainly in Buenos

Aires46 Their point of origin is mostly Taiwan and Fujian and to a lesser extent Hong

Kong Even though there are no good estimates or different in-depth studies lsquoChinese

immigration to Argentina is assumed to be largely of illegal naturersquo with lsquoremittances an

important flow of capitalrsquo and Argentina being lsquoan intermediate stoprsquo for approximately

half of the Chinese migrants before seeking entry into the United States (mainly) or the

European Union47

To sum up the capabilities willingness and needs of both sides make the relationship

between Argentina and China (and Asia) complementary The East needs raw materials

(energy food and mining) and Argentina needs investments and infrastructure Of course

a link of this nature presents opportunities but also brings risks It has become fashionable

in Argentina to compare the current situation with the golden years of the lsquospecial

relationshiprsquo with Great Britain (and Europe) that was undoubtedly the engine of the great

Argentine take off between 1880 and 1914 It is also noted that the new relationship with

Asia offers great benefits to the neighbouring countries and therefore does not threaten the

Dow

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ber

2014

262 R Russell and J G Tokatlian

harmony existing in the sub-region48 While recognizing the historic opportunity offered

to Argentina by the (re)emergence of China and the advancement of several Asian nations

others emphasize the risks especially those coming from China

Within that context it is relevant to mention that the highly optimistic somehow-naive

phase of Chinese ndash Latin American relations is experiencing changes including in

Argentina ndash China relations Most countries in the region and among them Argentina are

slowly moving from a strategy of lsquoreliable engagementrsquo49 to a more mixed strategy based

on a prudent approach that combines strong commercial ties and active damage-control

policies50 Latin American countries are well aware of the importance of key economic

issues and the sensitive security questions that characterize the regionrsquos relations with

China Concerns about de-industrialization via commodity-based export growth (affecting

basically South America) the effect of global lsquocurrency warsrsquo on the region (affecting all

of Latin America) and the impact of a decisive push for rural production within China

(affecting mainly Mexico and Central America) are extremely critical issues from North to

South America

On a broader outlook the fact that the global system is witnessing a period of

uncertainty is generating a new examination of Chinarsquos lsquowin-winrsquo diplomacy51 This is a

time of difficulties that places limits on Beijingrsquos global and regional strategies Not

surprisingly Argentina as well as other countries in Latin America is rethinking its ties

with China under a more nuanced viewpoint The advantages and dividends of more

commercial and financial links with China are superseded by new productive challenges

(for example excessive emphasis on commodities for export) at home and sensible

differences abroad (for example in the case of human rights) Interests and values are now

inextricably intertwined in Argentine ndash Chinese diplomacy In this context the deployment

of a more sophisticated policy vis-a-vis Beijing seems inevitable Necessity more than

willingness is pressing Buenos Aires to design a broader Asian strategy where China will

be a centrepiece but not the only counterpart politically and materially for the country

Looking Ahead

Argentinarsquos foreign policy developed historically from 1880 until the early twenty-first

century around three areas Europe the United States and Latin America especially the

Southern Cone countries Relations with the socialist world particularly with the Soviet

Union for political and commercial reasons were also important in the second half of the

twentieth century but never reached the scale of the other three axes In the decade since

2000 a fourth axis has been added to this traditional pattern with extraordinary strength

and projection the Asia Pacific region dominated by China

Relations with Europe remain important since there are shared interests and values and

a long history of mutual interaction In addition Argentina continues to need European

investments and technology transfers and the EU is still an important trading partner (See

Table 3) But Europe like Japan and the United States is a market in which exports have

shown in the last decade ceilings that are difficult to overcome The most dynamic and

consolidated markets for Argentina are in Latin America and Asia There are also other

developing markets that are growing at a faster pace than the rest of the world and offer

new opportunities for Argentine exports (Australia Canada Russia South Africa and

Turkey) In the next years Europe will focus its attention on domestic issues and other

areas of the world It is unlikely that any significant progress in the relations with

Argentina and Mercosur could be made in the short run A longer-term view suggests that

Dow

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ber

2014

Journal of Iberian and Latin American Research 263

Europe will increasingly lose its relative importance for Argentina and that its historically

privileged position in the countryrsquos foreign relations will be a thing of the past

Argentinarsquos relations with the United States have never been easy Joseph Tulchin

summarizes its nature in the title of his well-known book Argentina and the United States A Conflicted Relationship52 The strategy of lsquocouplingrsquo implemented during the Menem

years was a pragmatic adaptation to the world of the immediate post-Cold War and was

buried as a strategic option for Argentina with the 2001 crisis In the decade of 2000 the

Kirchners went back to the traditional historical pattern that we have called lsquolimited

oppositionrsquo53 This pattern which combines collaboration and disagreement deference

and resistance will continue to guide Argentinarsquos foreign policy toward Washington but

in a framework in which Buenos Airesrsquos concerns about restraining the United States

preponderance and power will tend to decrease Present conditions offer a great lsquoobjectiversquo

opportunity for the development of new areas of selective collaboration between the two

countries at the bilateral and regional levels A new era of relations with the United States

seems to be beginning for the Southern Cone one that is less unequal and perhaps more

cooperative The key challenge for Argentina is coping with a new reality of diminishing

influence of Washington in the sub-region Most of the time power erosion produces two

alternative behaviours adaptation or denial At least for the time being the relative decline

of US hegemony in South America is showing signs of a lsquosoft landingrsquo If this scenario

prevails then Argentina may manage its bilateral relation with the United States in a more

constructive way

In the case of Brazil it seems that we are entering a second long cycle of convergent

views about the place of this country in Argentinarsquos foreign policy54 This cycle may be

compared and opposed to another long period of convergent visions that characterized the

dominant form in which the neighbour country was perceived by the Argentine elites

during most of the twentieth century Today Brazil is defined as a strategic partner while

in the past until the return of both countries to democracy it was seen as a rival As we

have already mentioned the main challenge for Argentina is how to build this strategic

partnership within a framework of growing asymmetry

The link with Argentina although very important does not have today the same value

for Brazil as in the second half of the eighties By contrast the relationship with Brazil is

increasingly relevant for Argentinarsquos foreign relations and one that presents a significant

challenge In the past the relative symmetry between both countries was a constant source

of suspicion and conflict In the future the condition of asymmetric interdependence as a

structural feature of the relationship will not allow for competition but also is no

guarantee of friendship or cooperation Rather it can become a new source of suspicion

distrust and differences Argentina and Brazil will have to learn to live together in this new

reality and develop a broader framework of mutual understanding to manage the major

density of bilateral links and the global issues of common interests The greatest effort

must come from Argentina because it is the country that has a higher interest in the

relationship and more to gain

Finally the emergence of Asia is offering Argentina a unique opportunity for a

dynamic and successful international integration Its most recent economic dynamism is a

direct result of the increased demand from China and other Asian countries for food and

raw materials However Argentinarsquos exports to Asia are highly concentrated in the

soybean complex and to a much smaller extent in a small group of primary and natural

resource intensive products According to the latest ECLAC report five major products

accounted for 92 of total exports from Argentina to China during the years 2007 ndash 2009

(soybean 531 soybean oil 265 crude oil 747 other cattle 248 and meat and

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2014

264 R Russell and J G Tokatlian

poultry offal 233)55 Moreover the trade surplus with China has tended to evaporate

after several years of significant positive balances

This situation raises many questions about the Argentine specialization pattern ndash

beyond issues related to trade with China ndash and the need to reduce an excessive

dependence on the export of commodities Nevertheless as the benefits of trade with

China have been so high and have also enabled Argentina to successfully face and resist

the financial crises in the centres the propensity to do nothing is great As Eric Farnsworth

recently observed lsquoWhen nations are able to sell as much as they can produce of any

particular product the thinking is generally to continue doing so and reap the rewards

When economies are growing there is little political imperative or incentive for reformrsquo56

In consequence a relevant question surrounding this type of relationship is how to avoid

the temptation to inertia The tendency towards passive repetition is appealing The China

lsquochallengersquo in the early twenty-first century for Argentina is how to think and act

differently from what had been the case of Argentine ndash British relations at the beginning of

the twentieth century The framing of a different link with Beijing as well as the positive

handling of an increasingly complex multifaceted multilevel relationship with Brazil

seem to be the major challenges ahead for Argentinarsquos foreign relations

Notes 1 Roberto Russell and Juan G Tokatlian El lugar de Brasil en la polıtica exterior argentina

Buenos Aires Fondo de Cultura Econo mica 2003 pp 45 ndash 59 2 We use the concept lsquosystemic changesrsquo in the same sense as Robert Gilpin See his book War

and Change in World Politics Cambridge Cambridge University Press 1981 pp 42ndash 43 3 For an interesting analysis of these debates see Jose Paradiso Debates y trayectoria de la

polıtica exterior argentina Buenos Aires Grupo Editor Latinoamericano 1993 4 On the concept lsquoasymmetryrsquo and its implications for bilateral relations see Brantley Womack

lsquoAsymmetry and Systemic Misperception China Vietnam and Cambodia during the 1970rsquosrsquo Journal of Strategic Studies 262 June 2003 pp 92ndash 119

5 On structural and relational power see Susan Strange States and Markets An Introduction to International Political Economy London Pinter 1988 pp 25ndash9

6 David C Kang lsquoThe theoretical roots of hierarchy in international relationsrsquo Australian Journal of International Affairs 583 September 2004 p 339

7 Roberto Russell and Juan G Tokatlian lsquoBeyond Orthodoxy Asserting Latin Americarsquos New Strategic Options Toward the United Statesrsquo Latin America Politics and Society 533 Winter 2011 pp 129 ndash 134

8 Eric Hobsbawm lsquoDespues del siglo XX un mundo en transicionrsquo in Ricardo Lagos (ed) America Latina iquestintegracion o fragmentacion Buenos Aires Edhasa 2008 pp 29ndash 47

9 Remarks by the President of the Argentine Republic Nestor Kirchner at the inauguration of the IV Summit of the Americas Mar del Plata httpwwwsummit-ameicasorgDocuments 20del20presidente20de20RepC3BAblica20Argentinapdf

10 La Nacion (Buenos Aires) lsquoCristina Kirchner critico a Obama con duros terminosrsquo 26 February 2010 Available at httpwwwlanacioncomar1237368-cristina-kirchner-criticoshya-obama-con-duros-terminos accessed 17 November 2011

11 For more in depth analysis of the bilateral relations see Russell and Tokatlian El lugar de Brasil pp 45ndash59 and Roberto Russell and Juan G Tokatlian lsquoPercepcoes argentinas sobre o Brasil ambivalencias e expectativasrsquo Polıtica Externa 202 September 2011 pp 43ndash 56

12 Monica Hirst lsquoLa polıtica sudamericana de Brasil entre el peso de las asimetrıas y la incidencia de nuevas coyunturasrsquo in F Calderon (ed) Escenarios polıticos en America Latina Conceptos metodos y Observatorio Regional Cuadernos de Gobernabilidad Democratica 2 Buenos Aires PNUD Siglo XXI 2008 p 257

13 We use the concept of friendship following Alexander Wendt Social Theory of International Politics Cambridge Cambridge UP 1999 pp 297ndash 308

14 La Nacion Economıa y Negocios Buenos Aires lsquoBrasil en la vida cotidiana argentinarsquo 22 May 2011 p 1

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ber

2014

Journal of Iberian and Latin American Research 265

15 On China ndash Latin America relations at the beginning of the XXI Century see Juan G Tokatlian lsquoA view from Latin Americarsquo in R Roett and G Paz (eds) Chinarsquos Expansion into the Western Hemisphere Implications for Latin America and the United States Washington DC Brookings Institution Press 2008

16 According toMark P Sullivan a specialist on Latin American affairs at theUS Congressional Research Service lsquoThe balance of opinion toward China and the United States in Latin America tend to be roughly comparable according to a (2007) Pew study Two exceptions are Argentina where China is viewed much more favorably than the United States and in Mexico where the United States is viewed much more favorably than Chinarsquo See Thomas Lum (ed) lsquoComparing Global Influence China and US Diplomacy Foreign Aid Trade and Investment in the Developing Worldrsquo in CRS Report to Congress August 15 2008

17 Kevin Gallagher lsquoLatin Americarsquos China challengersquo 2011 Policy Innovations httpwwwase tuftsedugdaePubsrpGallagher_PolicyInnovationsJan11pdf accessed 18 November 2011

18 Pablo Gerchunoff 2010 lsquoCausas y azares en mas de un siglo de historia econo mica argentinarsquo in R Russell (ed) Argentina 1910ndash2010 Balance de un siglo Buenos Aires Taurus p 152

19 See the complete quote in Sergio Cesarin lsquoChina y Argentina Enfoques y recomendaciones para potenciar la relacion bilateralrsquo Serie Aportes 2010 httplibraryfesdepdf-filesbueros argentinien07560pdf accessed 28 November 2011

20 Based on INDEC 2011 and Comercio Exterior Argentino 2010 httpwwwindecgovar accessed 13 November 2011

21 Camara de Exportadores de la Republica Argentina En Contcto China No 43 November 2011 p 16

22 In October 2009 President Cristina Fernandez de Kirchner visited India It was her first trip to an Asian country after her inauguration in December 2007 and it was the first visit of an Argentine president to India since 1994

23 It is important to mention the cases of Indonesia and Vietnam for two reasons the growth of trade in the last decade and the fact Argentine exports to these two countries are mainly nonshytraditional commodities For example exports to Indonesia jumped fromUS$43million in 2001 to US$852 million in 2010 while exports to Vietnam grew from US$60 million in 2001 to US $654 million in 2010 Cların iEco Buenos Aires lsquoArgentina en mas puertosrsquo 28 August 2011

24 La Nacion Economıa y Negocios Buenos Aires lsquoLa soja argentina ahora apunta a la Indiarsquo 15 September 2011 p 3

25 China Daily lsquoArgentina China sign tentative swap dealrsquo 31 March 2009 httpwww chinadailycomcnchina2009-0331content_7635007htm accessed 11 November 2011

26 Argenpress (Buenos Aires) lsquoInversiones chinas en la Argentina Claves del nuevo escenario energeticorsquo 14 June 2011 httpwwwargenpressinfo201106inversiones-chinas-enshyargentina-claveshtml accessed 19 November 2011

27 See text of the agreement at httpwwwgrrorgarrionegro-chinaacuerdo-saiz-chinapdf accessed 26 Nov 2011 and El Cronista Buenos Aires lsquoChina invierte 1500 millones en Rıo Negro para asegurarse alimentosrsquo 9 June 2011 httpwwwcronistacomnegocios China-invierte-us-1500-millones-en-Rio-Negro-para-asegurarse-alimentos-20110609-0033 html accessed 19 November 2011

28 On other actual and potential Chinese investments in Argentine provinces see Camara Argentino China Negocios con China 2011 httpwwwargenchinaorgarticulos_2010 NegociosConChinapdf accessed 14 November 2011 and FUNDAMIN lsquoChina invierte en las 23 provincias argentinasrsquo httpfundamincomaresinfo36-exportaciones-e-importaciones 299-china-invierte-en-las-23-provincias-argentinashtml accessed 19 November 2011

29 httpwwwnoalaminaorgmineria-informacion-generalgeneralargentina-china-recreacionshyde-la-vieja-qrelacion-especialq-con-gran-bretana accessed 20 January 2012

30 lsquoLas relaciones entre China y Argentinarsquo httpespanolcricn1161201211281s264119 htm accessed 17 November 2011

31 lsquoRailway rapprochement China invests in Argentinarsquo 2010 httpwwwas-coaorgarticles 2528Railway_Rapprochement_China_Invests_in_Argentina accessed 17 Nov 2011

32 Silvia Simonit lsquoLas empresas chinas en Argentinarsquo Chinese Studies Working Paper Series (Universitat Pompeu Fabra) No 1 2011

33 Loro Horta lsquoIn Uncle Samrsquos Backyard Chinarsquos Military Influence in Latin Americarsquo Military Review September-October 2008 p 48

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ber

2014

266 R Russell and J G Tokatlian

34 As are the cases of Brazil Chile Colombia and Venezuela 35 Seguridad y Defensa lsquoEl Ejercito Negocia con China la compra de helico pterosrsquo 10 October

2010 httpwwwseguridadydefensacomarnoticiasejercito-negocia-con-china-la-comprashyde-helicopteros-25059html accessed 10 November 2011

36 httpwwwelmetroonlinecomarindexphpoption frac14com_k2ampviewfrac14 itemampidfrac141067 purishycelli-firmC3B3-convenio-de-defensa-con-chinaampItemid frac14238 accessed 12 September 2012

37 China Military Online lsquoChang Wanquan holds talks with Argentine deputy Defense ministerrsquo 28 November 2011 httpengchinamilcomcnnews-channelschina-militaryshynews2011-1128content_4725893htm accessed 29 November 2011

38 T Wang et lsquoNew SRL station running in San Juan of Argentinarsquo Crustal Dynamics Data Information System nd httpcddisgsfcnasagovlw15docspapersNew20SLR20Station 20Running20in20San20Juan20of20Argentinapdf accessed 9 November 2011

39 Chinese Academy of Sciences lsquoChina Argentina to strengthen cooperation on Antarctic expeditionrsquo 16 August 2010 httpenglishbiccascnNE201008t20100816_57510html accessed 29 November 2011

40 Janie Hulse lsquoChinarsquos Expansion into and US withdrawal from Argentinarsquos telecommunicashytions and space industries and the implications for US national securityrsquo Strategic Studies Institute September 2007 httpwwwstrategicstudiesinstitutearmymilpdffilespub806pdf accessed 7 November 2011

41 Ministry of Science and Technology lsquoChina y la Argentina se reu nen para desarrollar un Centro Binacionalrsquo 2011 httpwwwmincytgovaragendaagenda_detalle phpid_ agendafrac1435 accessed 16 November 2011

42 httpwwwlmneuquencomarnoticias201282avanza-instalacion-de-una-estacion-satel ital-de-china-en-la-provincia_156999 accessed 14 October 2012

43 httpwwwstrategicstudiesinstitutearmymilpubssummarycfmqfrac14 806 accessed 29 November 2011 httpenergyseenewscomnewsargentina-china-sign-nuclear-coop eration-agreement-306141 accessed 3 November 2012

44 For the major reasons that motivated this interest see Lyle Goldstein lsquoChinarsquos Falklands Lessonsrsquo Survival 503 2008 pp 65-66

45 UKNDA Inconvenient Truths Threats Justify Prioritising Defence London UKNDA 2011 p 24

46 La Nacion Buenos Aires lsquoVivir en la Argentina estudiar en Chinarsquo 11 October 2011 http wwwlanacioncomar1413556-vivir-en-la-argentina-estudiar-en-china accessed 9 Novemshyber 2011

47 G M Calderon lsquoInmigracion china en las Americas Comparacion de las experiencias en Canada y Argentinarsquo Revista Argentina de Estudios Canadienses No 2 2008 p 30

48 La Nacion Buenos Aires lsquoChina Una oportunidad histo ricarsquo 26 July 2011 49 Juan Tokatlian lsquoLatin America China and the United States A Hopeful Trianglersquo 2007

Open Democracy httpwwwopendemocracynetdemocracy-protesthopeful_triangle_ 4336jsp accessed 4 November 2011

50 La Nacion Buenos Aires lsquoUna nueva estrategia hacia Chinarsquo 29 August 2011 51 Brantley Womack lsquoBeyond Win-Win Rethinking International Relationships in an Era of

Economic Uncertaintyrsquo Paper presented to the International Conference on the Chinese Models of Development Domestic and Global Aspects Taipei Taiwan September 2011

52 Joseph Tulchin Argentina and the United States A Conflicted Relationship New York Macmillan 1990

53 Russell and Tokatlian lsquoBeyond Orthodoxyrsquo 54 According to the latest report of Latinobaro metro 52 of the Argentines consider Brazil as

the main leader of Latin America while only 2 gives that condition to the United States http wwwlatinobarometroorglatinoLATContenidosjsp accessed 23 November 2011

55 Osvaldo Rosales lsquoLa Republica Popular China y America Latina y el Caribe Hacia una nueva fase en el vınculo econo mico comercialrsquo 2011 ECLAC httpwwweclacorgpubl icacionesxml643666La_Republica_Popular _China_y_America_Latina_y_el_Caribe _ tradepdf accessed 10 November 2011

56 Eric Farnsworth 2011 lsquoThe New Mercantilism Chinarsquos Emerging Role in the Americasrsquo Current History February Available at httpwwwas coaorgarticles2982The_New_shyMercantilism_Chinas_Emerging_Role_in_the_Americas accessed 28 November 2011

Dow

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ovem

ber

2014

Journal of Iberian and Latin American Research 267

Appendix 1

Table 1

Argentinean trade with Brazil in millions of dollars 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Exports 6206 4828 4666 5587 6335 8141 10498 13272 11374 14420 Imports 5230 2517 4700 7567 10187 11749 14523 17687 11822 17658 Trade 975 2310 233 21980 23852 23608 24025 24415 2448 23238 balance

Argentinean trade with the United States in millions of dollars 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Exports 2840 2869 3364 3733 4493 4025 4153 5095 3465 3656 Imports 3737 1789 2238 3389 3998 4247 5264 6894 5106 6125 Trade 2897 1080 1126 344 495 2222 21111 21799 21641 22469 balance

Argentinean trade with China in millions of dollars 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Exports 1123 1092 2483 2628 3193 3476 5170 6355 3668 6117 Imports 1066 330 721 1402 2237 3122 5093 7104 4823 7678 Trade 56 762 1762 1227 956 354 77 2 749 2 1155 2 1561 balance

Source INDEC and UNCTAD

Table 2

FDI stock in Argentina by country of origin in millions of dollars (selected countries) 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

USA 16422 7476 7989 10277 11689 12208 13601 13930 14012 14814 of total 238 231 208 182 187 176 175 172 175 168

Brazil 1953 2108 3280 1773 2488 2810 3659 4969 4319 5367 of total 283 651 856 314 397 406 470 614 539 608

China no data no data no data 13 11 45 120 141 123 5500 of total no data no data no data 002 002 006 015 017 015 623

Total 68935 32403 38323 56554 62639 69292 77899 80941 80144 88249

for the years 2001 2002 and 2003 the data for Brazil includes all FDI from South America excluding ChileFrom 2003 onwards the data is exclusively for BrazilSource INDEC and UNCTAD

Table 3

Argentinean trade with the European Union in millions of dollars 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Exports 4698 5309 6079 6209 6844 8010 9901 13173 10278 11026 Imports 4717 2107 2814 4237 4830 5811 7442 9043 6434 7587 Trade 219 3201 3265 1972 2013 2199 2458 4130 3845 3439 balance

FDI from the European Union in Argentina in millions of dollars 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

FDI 38279 18284 21273 33001 36848 40408 45159 45070 44963 47605 of total 5553 5643 5551 5835 5883 5832 5797 5568 5610 5394 Total 68935 32403 38323 56554 62639 69292 77899 80941 80144 88249

Source INDEC and UNCTAD

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ovem

ber

2014

  • Abstract
  • The United States and Brazil Losing and Gaining Centrality
  • Relations with China (and Asia) A Historic and Challenging Opportunity
  • Looking Ahead
  • Notes
  • Appendix
Page 8: Implications of the Global and Regional Changes for Argentina's Foreign Relations

Journal of Iberian and Latin American Research 257

lsquoLatin-Americanrsquo policy in which the role of Mexico was presented as crucial On the

other hand the vision of Chile as a partner for a more balanced South America and as an

economic model also regained strength in a wide spectrum of the Argentine elites covering

the Right to the centre-Left Chilersquos image was contrasted with that of Brazil The first was

seen essentially as lsquopredictablersquo and lsquoreasonablersquo while the second after the triumph of

Lularsquos Workers Party tended to be presented on the opposite side For some closer

relations with Chile would serve to offset the influence of Brazil in the Southern Cone ndash a

Santiago ndash Buenos Aires axis to limit the Brazilian aspiration to lead the area ndash while

others perceived the lsquoChilean wayrsquo as the best manner for taking a safe distance from

Mercosur which was perceived as an obstacle to establishing a flexible dense and fruitful

relationship with the rest of the world Finally the Left identified the relationship with

Venezuela as a balancing factor for restraining the power of Brazil

The third phase of Argentine ndash Brazilian relations started at the end of 2006 and

extends to the present An interesting twist can be observed in the direction of a more

positive perception of Brazil that clearly puts it in a central place for Argentina Two main

factors explain this change The first and most important is the growing international

relevance and regional weight of Brazil This process has led to the formation of a

widespread perception in Argentina that defines Brazil as lsquoinevitablersquo with a predominant

negative and generally pessimistic bias or as a country that is lsquoindispensablersquo in this case

emphasizing the possibility of building a common future and a strong cooperative

relationship The idea of Brazil as a necessary country is widely accepted but has

variously been accepted with resignation disgust and joy alternatively viewed as an

opportunity or severe challenge The lsquosuccessrsquo of Brazil is often contrasted with the

lsquofailuresrsquo of Argentina and generates different feelings such as pain envy nostalgia and

desire for emulation In any case the growth and rise of Brazil has converted it into a

model for almost everyone The second factor is the growing density of bilateral relations

As an example it is interesting to note that Brazil is already the fourth largest foreign

investor in Argentina after the United States Spain and China In 2010 24 of total

exports (42 industrial) and 82 of the cars manufactured in Argentina were directed to

the Brazilian market and 863492 Brazilian tourists visited the country14 At the same

time the expansion of Brazilian companies in Argentinarsquos productive activity and trade

has been impressive in the last decade

The main issue for the future then is how to live and interact with the lsquoinevitablersquo or

lsquoindispensablersquo country This convergence of perceptions regarding the centrality of Brazil

for Argentina only goes so far There is no agreement on the political economic and

strategic interests that should constitute the relationship with Brazil and consequently

about the best ways to put them into practice The transition from an entrenched culture of

rivalry to an incipient culture of friendship has lasted more than a quarter of a century

providing promising dividends for both nations and offering a good platform from which

to renegotiate the growing bilateral ties The world and the region and the national

situation of the two countries especially concerning the distribution of attributes of

economic power are now very different to the 1980s when the two countries took the first

steps to build a positive bilateral relationship The double condition of the Argentine ndash

Brazilian relationship that is its increasingly close and uneven character suggests that

there will be a complex combination of convergence and divergence between the two

nations Argentina and Brazil never were Pakistan and India in terms of antagonism and

sought in the past to jointly become an equivalent to the Franco ndash German axis for the

integration of South America an aspiration that today is unsustainable Circumstances

have changed and the condition of lsquoasymmetric interdependencersquo is recognized and

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ovem

ber

2014

258 R Russell and J G Tokatlian

accepted in Argentina although not without the suspicions that characterize the attitudes

of the weaker party in a bilateral relationship In this context the main challenge for

Brasilia and Buenos Aires is to forge a realistic and positive lsquonew dealrsquo that contemplates

with its own specificity the bilateral relationship as well as Mercosur

In the end the above-mentioned three phases show the existence of both a changing

and intricate relationship If the theory of asymmetry is taken into consideration the first

move towards re-negotiating an unbalanced relationship should be initiated to a large

extent by the less powerful party In that sense it is yet unclear what the Argentine elites

(civilian and military economic and intellectual state-based and non-governmental) want

from relations with the continent (including the United States) the Spanish-speaking

region South America and finally Brazil Historically it has been quite difficult for

Argentines to have simultaneous positive relations with Washington and Brasilia In the

last two decades different opinions (sometimes personal more than collective) between

the lsquoLatin-Americanistsrsquo and the lsquoSouth-Americanistsrsquo favouring opposite strategic

options have been vocally expressed Currently several other countries in the area have

been increasing their leverage especially those facing the Pacific This phenomenon does

not go unnoticed by Argentine elites and is another source of domestic debate In this

dynamic and changing regional context Argentina has not been able to clearly establish

the goals and ambitions to guide its foreign policy towards the region and Brazil in

particular The response to this situation should be sought in essence in domestic politics

Relations with China (and Asia) A Historic and Challenging Opportunity

Argentine ndash Chinese links should be placed in the larger context of China ndashLatin America

relations15 From a Latin American perspective Chinarsquos growing presence in the region

has been seen at least in the first decade of the twenty-first century as a promising trend

Chinarsquos ties with Latin America from the 1950s to the 1970s were marginal focused

primarily on cultural diplomacy driven by ideological motives and based on

revolutionary rhetoric This diplomatic strategy relied on the dividends of destabilization

was accompanied by anti-US slogans and was geared toward strengthening pro-Chinese

(and anti-Soviet) political parties and movements Chinarsquos international behaviour during

that period was that of a revisionist actor who sought to change the rules of the game

through aggressive means

In contrast Beijingrsquos approach to the region since the 1990s has involved an active

economic diplomacy characterized by pragmatism conciliation and stability Chinarsquos key

goal and main challenge has been to deepen its relations with the countries of Latin America

without irritating Washington Diplomatically China has proceeded in a judicious fashion

which explains in part why regional forces did not emerge to veto a policy of prudent and

consistent engagement toward China In addition Chinarsquos external diplomatic model has

been seductive to Latin America especially during the two administrations of George

W Bush in the United States multipolarism as opposed to unipolarism multilateralism as

opposed to unilateralism non-interference as opposed to interventionism soft power as

opposed to hard power pragmatism as opposed to ideologisation collaboration as opposed

to domination and persuasion as opposed to coercion All have been attractive notions in

Latin America Chinarsquos contemporary approach coincides with strong Latin American

traditions and aspirations and has become more captivating by virtue of the mishandling

disregard and thoughtlessness of US foreign policy towards the region

Nothing indicates that Latin America is geared towards accepting a paternalistic

externally-induced security dilemma with China and the region does not feel insecure visshy

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ovem

ber

2014

Journal of Iberian and Latin American Research 259

a-vis Beijing despite certain ideologically-driven pressure groups in Washington

Moreover the Sino ndash Latin American ndash US triangular relationship has not engendered

major tensions or unmanageable challenges16 There is also nothing to suggest from a

regional viewpoint that Latin America ndash China ndash United States relations are destined to an

apocalyptic geopolitics approach based on an overblown fear of an alleged Chinese

takeover of the region China is not the Soviet Union post 911 is not a rehearsal of the

Cold War Washington is no longer at the pinnacle of world power and Latin America has

not collapsed after the Western economic and financial crisis began in 2008 There is also

no indication that Chinarsquos intention is to challenge the United States in the Western

Hemisphere In fact the Chinese government has actively sought to convince the United

States and the rest of the world that its intentions are benign thus the self-portrayal of a

peaceful rise

Chinarsquos behaviour in Latin America at the outset of the twenty-first century has been

far from that of a revisionist power On the one hand Beijingrsquos strategy has combined

necessity with opportunity and has been put into practice cautiously and diligently

curtailing the likelihood that the region will develop or adopt a policy aimed at rolling

back Chinarsquos presence On the other hand Latin Americarsquos relationship with Beijing is

more dependent on economic facts than political conceptions As there is no major

ideological concern in most countries about dealing with China the crucial element is the

material effect of Sino ndash Latin American linkages the level of dependency of the region

vis-a-vis China the degree of de-industrialization of the area derived from bilateral trade

and the ecological consequences of Chinese investment in Latin America17

This broader framework is essential to understand the dynamics of Argentinarsquos

relations with China in the larger context of Argentinendash Asian links Over the past two

decades the (re)emergence of China and the ascent of Asia have been a blessing for

Argentina Rising demand and higher prices for commodities have made it possible for

Argentina to elevate and diversify its trade flows with the East Since the 1990s and

despite the discernible differences in economic and foreign policies between Carlos

Menem and the Kirchners Argentina has developed a new pattern of production that has

led notwithstanding the crisis of 2001 to a reorganization of the economic base of the

country As noted by Pablo Gerchunoff lsquoIt is not just about the speed of exports there is

also a significant diversification traditional agriculture new agriculture industry energy

and mining concurred to modify the national economic landscapersquo18 In that context and

according to President Nestor Kirchner it was crucial lsquothrough China to search in Asia the

leverage to re-industrialize Argentinarsquo Economy not politics has been the driving force

to improve and extend Argentine relations with the East19

For the first time in more than seven decades Argentina has met a world that eagerly

requires what it produces The key driver of this demand is located in China but covers a

wide range of countries At present China is Argentinarsquos second largest trading partner

both in terms of the origin of imports and recipient of exports ndash in both dimensions after

Brazil and before the United States (See Table 1) Argentina meanwhile ranks third in the

list of the 15 major suppliers of agricultural products which supplied 90 per cent of

Chinese imports in 2010 United States (244) Brazil (136) and Argentina (73)

Other major suppliers were the European Union (6) Australia (5) and Malaysia (5)

By 2001 Argentine exports to China surpassed the US$1 billion barrier to hit US$1123

billion and imports totalled US$1066 billion Thus there was a small surplus of US$56

million in favour of Argentina By 2010 the commercial exchange was worth US$13795

billion totalling US$6117 billion in Argentine exports and US$7678 billion in Chinese

exports The result was a trade balance of US$1561 billion in Chinarsquos favour20 In the

Dow

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ovem

ber

2014

260 R Russell and J G Tokatlian

period January ndashSeptember 2011 the surplus in favour of China grew While Argentine

exports amounted to US$4746 billion Chinese exports came to US$7569 billion21

India is Argentinarsquos main Asian trading partner after China22 Other important

countries are Indonesia South Korea Malaysia Vietnam and Thailand23 By 2010 when

China implemented barriers to Argentine soybean oil in retaliation for local action that

prevented the entry of Chinese products into the country Argentina reoriented its soybean

exports to India which bought 14 million tons of soybean oil (corresponding to US$12

billion dollars) In September 2011 Indiarsquos ambassador in Argentina said his country

would increase demand for soybean oil over the next ten years from the current 8 million

to 15 million tons representing a significant additional opportunity for Argentine

producers and exporters24

Indeed ties with Asia are not limited to trade Again the paradigmatic case of this

new relationship is China which in recent years has also emerged as an increasingly

important financial actor During 2009 at a high point of the US-originated financial

crisis China and Argentina agreed to swap US$10 billion worth of their currencies in

order to enable Argentina to avoid using dollars in trade between both countries an

agreement that was the first of this sort between China and a South American country25

Beijing simultaneously accelerated its investment in agriculture mining energy and

banking and has become the third largest investor in the country (See Table 2)26 In

addition there is strong Chinese interest for participation in infrastructure development

projects in sectors such as railways roads ports and telecommunications The largest

food company in China Heilonjiang Beida-Huang signed an October 2010 cooperation

agreement with the province of Rıo Negro27 which provides China with twenty-year

leases on provincial lands (20000 hectares at an early stage that may eventually extend

to up to 320000 hectares)28 In return the Chinese company is committed to

undertaking major irrigation and infrastructure works as part of a ten-year investment of

US$15 billion dollars29 Different actors from Argentina are also opening trade offices

in Chinese cities and several twin cities and sister provinces have signed different 30agreements

In the oil sector the China National Offshore Oil Corporation (CNOOC) acquired 50

per cent of Bridas Corporation and Sinopec holds 100 per cent of Argentine assets in

Occidental In addition China controls 50 per cent of the Cerro Dragon field and will

handle major reserves for 40 years in the province of Santa Cruz To sum up Beijingrsquos

growing interest in Argentina has meant that the country is according to Levi J Jordan

from the Americas Society lsquoreceiving almost half of Chinarsquos investment in South America

over the past two yearsrsquo31 In that context the growth of Chinarsquos state corporations is

impressive32 Agreements have also been made in the field of defence the most prominent

is the signing of the Memorandum of Understanding for Strengthening Exchanges and

Cooperation in Defense of 16 May 2007 whereby both countries have committed to

maintain contacts to discuss global and regional security issues to cooperate on military

equipment and logistics and to establish a Defence Joint Commission It is worth

mentioning that officers from Argentina together with military from Chile and Colombia

frequently (more often than counterparts from Cuba and Venezuela) have attended courses

on grand strategy at Beijingrsquos elite national defence university PLANDU33 Even though

Argentina is not a significant South American buyer of military equipment34 has a very

low annual defence budget and that China is not the major supplier of arms to the region

(as it is the case of the United States Russia and the European Union) it has lately

considered the acquisition of Chinese Z-11 helicopters35 Finally after a July 2012 visit to

China by Argentine Defence Minister Arturo Puricelli both countries agreed that

Dow

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ovem

ber

2014

Journal of Iberian and Latin American Research 261

Argentina will construct a prototype of that helicopter by 201336 In general the level of

bilateral military dialogue is highly positive37

In key scientific and technological areas there has been an on-going improvement of

relations For example a Satellite Laser Raging (SLR) system designed and made in China

was installed in the Observatory of San Juan University38 Both countries plan to conduct

collaborative activities for Antarctic expedition39 There are many contacts and joint

initiatives in the areas of telecommunications and space40 The two countries are also

interested in creating a Bilateral Centre on Science and Technology for Food41

In addition China will install a satellite station in the province of Neuquen42 while

incrementing its presence in the telecommunications sector and establishing cooperation

ties in the nuclear field43

Argentina and China share important interests in their diplomatic agenda with regards

to the defence of the principle of lsquoterritorial integrityrsquo China consistently supports the

Argentine claim of sovereignty over the MalvinasFalklands while Argentina defends the

policy of lsquoone Chinarsquo which implies the non-recognition of the independence of Taiwan

and Tibet The issue of the MalvinasFalklands Islands has been surfacing for two reasons

On the one hand as Lyle Goldstein has remarked lsquoChinese defence analysts take such

intense interest in the Falkland Warrsquo due to the fact that according to Chinese government

officials and experts there are certain similarities between the Malvinas and Taiwan44 As

Taiwan is a vital issue for Beijing the understanding of the 1982 war in the South Atlantic

is extremely relevant On the other hand the potential closeness of China and Argentina

may provoke in the future a vulnerable situation with regards to the islands that could

affect British defence policy45 In times of a major economic crisis in Europe and with

diminishing possibilities of sustaining high defence budgets retired military officers from

Great Britain overemphasize Londonrsquos potential weakness in the South Atlantic

With respect to issues on the global agenda the two countries agree at the level of the

G-20 on the need for greater participation of emerging nations in international financial

organizations as well as the need to implement measures for the avoidance of financial

speculation that causes volatility in the prices of commodities Both countries have been

supporting peacekeeping operations and they both participate militarily in the UN Mission

in Haiti At the International Atomic Energy Agency Beijing and Buenos Aires have been

active in the promotion of non-proliferation

It is important also to mention a relatively new phenomenon in the relation between

Beijing and Buenos Aires namely Chinese immigration to Argentina There are

approximately 120000 Chinese and Chinese-descendants in Argentina mainly in Buenos

Aires46 Their point of origin is mostly Taiwan and Fujian and to a lesser extent Hong

Kong Even though there are no good estimates or different in-depth studies lsquoChinese

immigration to Argentina is assumed to be largely of illegal naturersquo with lsquoremittances an

important flow of capitalrsquo and Argentina being lsquoan intermediate stoprsquo for approximately

half of the Chinese migrants before seeking entry into the United States (mainly) or the

European Union47

To sum up the capabilities willingness and needs of both sides make the relationship

between Argentina and China (and Asia) complementary The East needs raw materials

(energy food and mining) and Argentina needs investments and infrastructure Of course

a link of this nature presents opportunities but also brings risks It has become fashionable

in Argentina to compare the current situation with the golden years of the lsquospecial

relationshiprsquo with Great Britain (and Europe) that was undoubtedly the engine of the great

Argentine take off between 1880 and 1914 It is also noted that the new relationship with

Asia offers great benefits to the neighbouring countries and therefore does not threaten the

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262 R Russell and J G Tokatlian

harmony existing in the sub-region48 While recognizing the historic opportunity offered

to Argentina by the (re)emergence of China and the advancement of several Asian nations

others emphasize the risks especially those coming from China

Within that context it is relevant to mention that the highly optimistic somehow-naive

phase of Chinese ndash Latin American relations is experiencing changes including in

Argentina ndash China relations Most countries in the region and among them Argentina are

slowly moving from a strategy of lsquoreliable engagementrsquo49 to a more mixed strategy based

on a prudent approach that combines strong commercial ties and active damage-control

policies50 Latin American countries are well aware of the importance of key economic

issues and the sensitive security questions that characterize the regionrsquos relations with

China Concerns about de-industrialization via commodity-based export growth (affecting

basically South America) the effect of global lsquocurrency warsrsquo on the region (affecting all

of Latin America) and the impact of a decisive push for rural production within China

(affecting mainly Mexico and Central America) are extremely critical issues from North to

South America

On a broader outlook the fact that the global system is witnessing a period of

uncertainty is generating a new examination of Chinarsquos lsquowin-winrsquo diplomacy51 This is a

time of difficulties that places limits on Beijingrsquos global and regional strategies Not

surprisingly Argentina as well as other countries in Latin America is rethinking its ties

with China under a more nuanced viewpoint The advantages and dividends of more

commercial and financial links with China are superseded by new productive challenges

(for example excessive emphasis on commodities for export) at home and sensible

differences abroad (for example in the case of human rights) Interests and values are now

inextricably intertwined in Argentine ndash Chinese diplomacy In this context the deployment

of a more sophisticated policy vis-a-vis Beijing seems inevitable Necessity more than

willingness is pressing Buenos Aires to design a broader Asian strategy where China will

be a centrepiece but not the only counterpart politically and materially for the country

Looking Ahead

Argentinarsquos foreign policy developed historically from 1880 until the early twenty-first

century around three areas Europe the United States and Latin America especially the

Southern Cone countries Relations with the socialist world particularly with the Soviet

Union for political and commercial reasons were also important in the second half of the

twentieth century but never reached the scale of the other three axes In the decade since

2000 a fourth axis has been added to this traditional pattern with extraordinary strength

and projection the Asia Pacific region dominated by China

Relations with Europe remain important since there are shared interests and values and

a long history of mutual interaction In addition Argentina continues to need European

investments and technology transfers and the EU is still an important trading partner (See

Table 3) But Europe like Japan and the United States is a market in which exports have

shown in the last decade ceilings that are difficult to overcome The most dynamic and

consolidated markets for Argentina are in Latin America and Asia There are also other

developing markets that are growing at a faster pace than the rest of the world and offer

new opportunities for Argentine exports (Australia Canada Russia South Africa and

Turkey) In the next years Europe will focus its attention on domestic issues and other

areas of the world It is unlikely that any significant progress in the relations with

Argentina and Mercosur could be made in the short run A longer-term view suggests that

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2014

Journal of Iberian and Latin American Research 263

Europe will increasingly lose its relative importance for Argentina and that its historically

privileged position in the countryrsquos foreign relations will be a thing of the past

Argentinarsquos relations with the United States have never been easy Joseph Tulchin

summarizes its nature in the title of his well-known book Argentina and the United States A Conflicted Relationship52 The strategy of lsquocouplingrsquo implemented during the Menem

years was a pragmatic adaptation to the world of the immediate post-Cold War and was

buried as a strategic option for Argentina with the 2001 crisis In the decade of 2000 the

Kirchners went back to the traditional historical pattern that we have called lsquolimited

oppositionrsquo53 This pattern which combines collaboration and disagreement deference

and resistance will continue to guide Argentinarsquos foreign policy toward Washington but

in a framework in which Buenos Airesrsquos concerns about restraining the United States

preponderance and power will tend to decrease Present conditions offer a great lsquoobjectiversquo

opportunity for the development of new areas of selective collaboration between the two

countries at the bilateral and regional levels A new era of relations with the United States

seems to be beginning for the Southern Cone one that is less unequal and perhaps more

cooperative The key challenge for Argentina is coping with a new reality of diminishing

influence of Washington in the sub-region Most of the time power erosion produces two

alternative behaviours adaptation or denial At least for the time being the relative decline

of US hegemony in South America is showing signs of a lsquosoft landingrsquo If this scenario

prevails then Argentina may manage its bilateral relation with the United States in a more

constructive way

In the case of Brazil it seems that we are entering a second long cycle of convergent

views about the place of this country in Argentinarsquos foreign policy54 This cycle may be

compared and opposed to another long period of convergent visions that characterized the

dominant form in which the neighbour country was perceived by the Argentine elites

during most of the twentieth century Today Brazil is defined as a strategic partner while

in the past until the return of both countries to democracy it was seen as a rival As we

have already mentioned the main challenge for Argentina is how to build this strategic

partnership within a framework of growing asymmetry

The link with Argentina although very important does not have today the same value

for Brazil as in the second half of the eighties By contrast the relationship with Brazil is

increasingly relevant for Argentinarsquos foreign relations and one that presents a significant

challenge In the past the relative symmetry between both countries was a constant source

of suspicion and conflict In the future the condition of asymmetric interdependence as a

structural feature of the relationship will not allow for competition but also is no

guarantee of friendship or cooperation Rather it can become a new source of suspicion

distrust and differences Argentina and Brazil will have to learn to live together in this new

reality and develop a broader framework of mutual understanding to manage the major

density of bilateral links and the global issues of common interests The greatest effort

must come from Argentina because it is the country that has a higher interest in the

relationship and more to gain

Finally the emergence of Asia is offering Argentina a unique opportunity for a

dynamic and successful international integration Its most recent economic dynamism is a

direct result of the increased demand from China and other Asian countries for food and

raw materials However Argentinarsquos exports to Asia are highly concentrated in the

soybean complex and to a much smaller extent in a small group of primary and natural

resource intensive products According to the latest ECLAC report five major products

accounted for 92 of total exports from Argentina to China during the years 2007 ndash 2009

(soybean 531 soybean oil 265 crude oil 747 other cattle 248 and meat and

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264 R Russell and J G Tokatlian

poultry offal 233)55 Moreover the trade surplus with China has tended to evaporate

after several years of significant positive balances

This situation raises many questions about the Argentine specialization pattern ndash

beyond issues related to trade with China ndash and the need to reduce an excessive

dependence on the export of commodities Nevertheless as the benefits of trade with

China have been so high and have also enabled Argentina to successfully face and resist

the financial crises in the centres the propensity to do nothing is great As Eric Farnsworth

recently observed lsquoWhen nations are able to sell as much as they can produce of any

particular product the thinking is generally to continue doing so and reap the rewards

When economies are growing there is little political imperative or incentive for reformrsquo56

In consequence a relevant question surrounding this type of relationship is how to avoid

the temptation to inertia The tendency towards passive repetition is appealing The China

lsquochallengersquo in the early twenty-first century for Argentina is how to think and act

differently from what had been the case of Argentine ndash British relations at the beginning of

the twentieth century The framing of a different link with Beijing as well as the positive

handling of an increasingly complex multifaceted multilevel relationship with Brazil

seem to be the major challenges ahead for Argentinarsquos foreign relations

Notes 1 Roberto Russell and Juan G Tokatlian El lugar de Brasil en la polıtica exterior argentina

Buenos Aires Fondo de Cultura Econo mica 2003 pp 45 ndash 59 2 We use the concept lsquosystemic changesrsquo in the same sense as Robert Gilpin See his book War

and Change in World Politics Cambridge Cambridge University Press 1981 pp 42ndash 43 3 For an interesting analysis of these debates see Jose Paradiso Debates y trayectoria de la

polıtica exterior argentina Buenos Aires Grupo Editor Latinoamericano 1993 4 On the concept lsquoasymmetryrsquo and its implications for bilateral relations see Brantley Womack

lsquoAsymmetry and Systemic Misperception China Vietnam and Cambodia during the 1970rsquosrsquo Journal of Strategic Studies 262 June 2003 pp 92ndash 119

5 On structural and relational power see Susan Strange States and Markets An Introduction to International Political Economy London Pinter 1988 pp 25ndash9

6 David C Kang lsquoThe theoretical roots of hierarchy in international relationsrsquo Australian Journal of International Affairs 583 September 2004 p 339

7 Roberto Russell and Juan G Tokatlian lsquoBeyond Orthodoxy Asserting Latin Americarsquos New Strategic Options Toward the United Statesrsquo Latin America Politics and Society 533 Winter 2011 pp 129 ndash 134

8 Eric Hobsbawm lsquoDespues del siglo XX un mundo en transicionrsquo in Ricardo Lagos (ed) America Latina iquestintegracion o fragmentacion Buenos Aires Edhasa 2008 pp 29ndash 47

9 Remarks by the President of the Argentine Republic Nestor Kirchner at the inauguration of the IV Summit of the Americas Mar del Plata httpwwwsummit-ameicasorgDocuments 20del20presidente20de20RepC3BAblica20Argentinapdf

10 La Nacion (Buenos Aires) lsquoCristina Kirchner critico a Obama con duros terminosrsquo 26 February 2010 Available at httpwwwlanacioncomar1237368-cristina-kirchner-criticoshya-obama-con-duros-terminos accessed 17 November 2011

11 For more in depth analysis of the bilateral relations see Russell and Tokatlian El lugar de Brasil pp 45ndash59 and Roberto Russell and Juan G Tokatlian lsquoPercepcoes argentinas sobre o Brasil ambivalencias e expectativasrsquo Polıtica Externa 202 September 2011 pp 43ndash 56

12 Monica Hirst lsquoLa polıtica sudamericana de Brasil entre el peso de las asimetrıas y la incidencia de nuevas coyunturasrsquo in F Calderon (ed) Escenarios polıticos en America Latina Conceptos metodos y Observatorio Regional Cuadernos de Gobernabilidad Democratica 2 Buenos Aires PNUD Siglo XXI 2008 p 257

13 We use the concept of friendship following Alexander Wendt Social Theory of International Politics Cambridge Cambridge UP 1999 pp 297ndash 308

14 La Nacion Economıa y Negocios Buenos Aires lsquoBrasil en la vida cotidiana argentinarsquo 22 May 2011 p 1

Dow

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ber

2014

Journal of Iberian and Latin American Research 265

15 On China ndash Latin America relations at the beginning of the XXI Century see Juan G Tokatlian lsquoA view from Latin Americarsquo in R Roett and G Paz (eds) Chinarsquos Expansion into the Western Hemisphere Implications for Latin America and the United States Washington DC Brookings Institution Press 2008

16 According toMark P Sullivan a specialist on Latin American affairs at theUS Congressional Research Service lsquoThe balance of opinion toward China and the United States in Latin America tend to be roughly comparable according to a (2007) Pew study Two exceptions are Argentina where China is viewed much more favorably than the United States and in Mexico where the United States is viewed much more favorably than Chinarsquo See Thomas Lum (ed) lsquoComparing Global Influence China and US Diplomacy Foreign Aid Trade and Investment in the Developing Worldrsquo in CRS Report to Congress August 15 2008

17 Kevin Gallagher lsquoLatin Americarsquos China challengersquo 2011 Policy Innovations httpwwwase tuftsedugdaePubsrpGallagher_PolicyInnovationsJan11pdf accessed 18 November 2011

18 Pablo Gerchunoff 2010 lsquoCausas y azares en mas de un siglo de historia econo mica argentinarsquo in R Russell (ed) Argentina 1910ndash2010 Balance de un siglo Buenos Aires Taurus p 152

19 See the complete quote in Sergio Cesarin lsquoChina y Argentina Enfoques y recomendaciones para potenciar la relacion bilateralrsquo Serie Aportes 2010 httplibraryfesdepdf-filesbueros argentinien07560pdf accessed 28 November 2011

20 Based on INDEC 2011 and Comercio Exterior Argentino 2010 httpwwwindecgovar accessed 13 November 2011

21 Camara de Exportadores de la Republica Argentina En Contcto China No 43 November 2011 p 16

22 In October 2009 President Cristina Fernandez de Kirchner visited India It was her first trip to an Asian country after her inauguration in December 2007 and it was the first visit of an Argentine president to India since 1994

23 It is important to mention the cases of Indonesia and Vietnam for two reasons the growth of trade in the last decade and the fact Argentine exports to these two countries are mainly nonshytraditional commodities For example exports to Indonesia jumped fromUS$43million in 2001 to US$852 million in 2010 while exports to Vietnam grew from US$60 million in 2001 to US $654 million in 2010 Cların iEco Buenos Aires lsquoArgentina en mas puertosrsquo 28 August 2011

24 La Nacion Economıa y Negocios Buenos Aires lsquoLa soja argentina ahora apunta a la Indiarsquo 15 September 2011 p 3

25 China Daily lsquoArgentina China sign tentative swap dealrsquo 31 March 2009 httpwww chinadailycomcnchina2009-0331content_7635007htm accessed 11 November 2011

26 Argenpress (Buenos Aires) lsquoInversiones chinas en la Argentina Claves del nuevo escenario energeticorsquo 14 June 2011 httpwwwargenpressinfo201106inversiones-chinas-enshyargentina-claveshtml accessed 19 November 2011

27 See text of the agreement at httpwwwgrrorgarrionegro-chinaacuerdo-saiz-chinapdf accessed 26 Nov 2011 and El Cronista Buenos Aires lsquoChina invierte 1500 millones en Rıo Negro para asegurarse alimentosrsquo 9 June 2011 httpwwwcronistacomnegocios China-invierte-us-1500-millones-en-Rio-Negro-para-asegurarse-alimentos-20110609-0033 html accessed 19 November 2011

28 On other actual and potential Chinese investments in Argentine provinces see Camara Argentino China Negocios con China 2011 httpwwwargenchinaorgarticulos_2010 NegociosConChinapdf accessed 14 November 2011 and FUNDAMIN lsquoChina invierte en las 23 provincias argentinasrsquo httpfundamincomaresinfo36-exportaciones-e-importaciones 299-china-invierte-en-las-23-provincias-argentinashtml accessed 19 November 2011

29 httpwwwnoalaminaorgmineria-informacion-generalgeneralargentina-china-recreacionshyde-la-vieja-qrelacion-especialq-con-gran-bretana accessed 20 January 2012

30 lsquoLas relaciones entre China y Argentinarsquo httpespanolcricn1161201211281s264119 htm accessed 17 November 2011

31 lsquoRailway rapprochement China invests in Argentinarsquo 2010 httpwwwas-coaorgarticles 2528Railway_Rapprochement_China_Invests_in_Argentina accessed 17 Nov 2011

32 Silvia Simonit lsquoLas empresas chinas en Argentinarsquo Chinese Studies Working Paper Series (Universitat Pompeu Fabra) No 1 2011

33 Loro Horta lsquoIn Uncle Samrsquos Backyard Chinarsquos Military Influence in Latin Americarsquo Military Review September-October 2008 p 48

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ber

2014

266 R Russell and J G Tokatlian

34 As are the cases of Brazil Chile Colombia and Venezuela 35 Seguridad y Defensa lsquoEl Ejercito Negocia con China la compra de helico pterosrsquo 10 October

2010 httpwwwseguridadydefensacomarnoticiasejercito-negocia-con-china-la-comprashyde-helicopteros-25059html accessed 10 November 2011

36 httpwwwelmetroonlinecomarindexphpoption frac14com_k2ampviewfrac14 itemampidfrac141067 purishycelli-firmC3B3-convenio-de-defensa-con-chinaampItemid frac14238 accessed 12 September 2012

37 China Military Online lsquoChang Wanquan holds talks with Argentine deputy Defense ministerrsquo 28 November 2011 httpengchinamilcomcnnews-channelschina-militaryshynews2011-1128content_4725893htm accessed 29 November 2011

38 T Wang et lsquoNew SRL station running in San Juan of Argentinarsquo Crustal Dynamics Data Information System nd httpcddisgsfcnasagovlw15docspapersNew20SLR20Station 20Running20in20San20Juan20of20Argentinapdf accessed 9 November 2011

39 Chinese Academy of Sciences lsquoChina Argentina to strengthen cooperation on Antarctic expeditionrsquo 16 August 2010 httpenglishbiccascnNE201008t20100816_57510html accessed 29 November 2011

40 Janie Hulse lsquoChinarsquos Expansion into and US withdrawal from Argentinarsquos telecommunicashytions and space industries and the implications for US national securityrsquo Strategic Studies Institute September 2007 httpwwwstrategicstudiesinstitutearmymilpdffilespub806pdf accessed 7 November 2011

41 Ministry of Science and Technology lsquoChina y la Argentina se reu nen para desarrollar un Centro Binacionalrsquo 2011 httpwwwmincytgovaragendaagenda_detalle phpid_ agendafrac1435 accessed 16 November 2011

42 httpwwwlmneuquencomarnoticias201282avanza-instalacion-de-una-estacion-satel ital-de-china-en-la-provincia_156999 accessed 14 October 2012

43 httpwwwstrategicstudiesinstitutearmymilpubssummarycfmqfrac14 806 accessed 29 November 2011 httpenergyseenewscomnewsargentina-china-sign-nuclear-coop eration-agreement-306141 accessed 3 November 2012

44 For the major reasons that motivated this interest see Lyle Goldstein lsquoChinarsquos Falklands Lessonsrsquo Survival 503 2008 pp 65-66

45 UKNDA Inconvenient Truths Threats Justify Prioritising Defence London UKNDA 2011 p 24

46 La Nacion Buenos Aires lsquoVivir en la Argentina estudiar en Chinarsquo 11 October 2011 http wwwlanacioncomar1413556-vivir-en-la-argentina-estudiar-en-china accessed 9 Novemshyber 2011

47 G M Calderon lsquoInmigracion china en las Americas Comparacion de las experiencias en Canada y Argentinarsquo Revista Argentina de Estudios Canadienses No 2 2008 p 30

48 La Nacion Buenos Aires lsquoChina Una oportunidad histo ricarsquo 26 July 2011 49 Juan Tokatlian lsquoLatin America China and the United States A Hopeful Trianglersquo 2007

Open Democracy httpwwwopendemocracynetdemocracy-protesthopeful_triangle_ 4336jsp accessed 4 November 2011

50 La Nacion Buenos Aires lsquoUna nueva estrategia hacia Chinarsquo 29 August 2011 51 Brantley Womack lsquoBeyond Win-Win Rethinking International Relationships in an Era of

Economic Uncertaintyrsquo Paper presented to the International Conference on the Chinese Models of Development Domestic and Global Aspects Taipei Taiwan September 2011

52 Joseph Tulchin Argentina and the United States A Conflicted Relationship New York Macmillan 1990

53 Russell and Tokatlian lsquoBeyond Orthodoxyrsquo 54 According to the latest report of Latinobaro metro 52 of the Argentines consider Brazil as

the main leader of Latin America while only 2 gives that condition to the United States http wwwlatinobarometroorglatinoLATContenidosjsp accessed 23 November 2011

55 Osvaldo Rosales lsquoLa Republica Popular China y America Latina y el Caribe Hacia una nueva fase en el vınculo econo mico comercialrsquo 2011 ECLAC httpwwweclacorgpubl icacionesxml643666La_Republica_Popular _China_y_America_Latina_y_el_Caribe _ tradepdf accessed 10 November 2011

56 Eric Farnsworth 2011 lsquoThe New Mercantilism Chinarsquos Emerging Role in the Americasrsquo Current History February Available at httpwwwas coaorgarticles2982The_New_shyMercantilism_Chinas_Emerging_Role_in_the_Americas accessed 28 November 2011

Dow

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ovem

ber

2014

Journal of Iberian and Latin American Research 267

Appendix 1

Table 1

Argentinean trade with Brazil in millions of dollars 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Exports 6206 4828 4666 5587 6335 8141 10498 13272 11374 14420 Imports 5230 2517 4700 7567 10187 11749 14523 17687 11822 17658 Trade 975 2310 233 21980 23852 23608 24025 24415 2448 23238 balance

Argentinean trade with the United States in millions of dollars 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Exports 2840 2869 3364 3733 4493 4025 4153 5095 3465 3656 Imports 3737 1789 2238 3389 3998 4247 5264 6894 5106 6125 Trade 2897 1080 1126 344 495 2222 21111 21799 21641 22469 balance

Argentinean trade with China in millions of dollars 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Exports 1123 1092 2483 2628 3193 3476 5170 6355 3668 6117 Imports 1066 330 721 1402 2237 3122 5093 7104 4823 7678 Trade 56 762 1762 1227 956 354 77 2 749 2 1155 2 1561 balance

Source INDEC and UNCTAD

Table 2

FDI stock in Argentina by country of origin in millions of dollars (selected countries) 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

USA 16422 7476 7989 10277 11689 12208 13601 13930 14012 14814 of total 238 231 208 182 187 176 175 172 175 168

Brazil 1953 2108 3280 1773 2488 2810 3659 4969 4319 5367 of total 283 651 856 314 397 406 470 614 539 608

China no data no data no data 13 11 45 120 141 123 5500 of total no data no data no data 002 002 006 015 017 015 623

Total 68935 32403 38323 56554 62639 69292 77899 80941 80144 88249

for the years 2001 2002 and 2003 the data for Brazil includes all FDI from South America excluding ChileFrom 2003 onwards the data is exclusively for BrazilSource INDEC and UNCTAD

Table 3

Argentinean trade with the European Union in millions of dollars 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Exports 4698 5309 6079 6209 6844 8010 9901 13173 10278 11026 Imports 4717 2107 2814 4237 4830 5811 7442 9043 6434 7587 Trade 219 3201 3265 1972 2013 2199 2458 4130 3845 3439 balance

FDI from the European Union in Argentina in millions of dollars 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

FDI 38279 18284 21273 33001 36848 40408 45159 45070 44963 47605 of total 5553 5643 5551 5835 5883 5832 5797 5568 5610 5394 Total 68935 32403 38323 56554 62639 69292 77899 80941 80144 88249

Source INDEC and UNCTAD

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ovem

ber

2014

  • Abstract
  • The United States and Brazil Losing and Gaining Centrality
  • Relations with China (and Asia) A Historic and Challenging Opportunity
  • Looking Ahead
  • Notes
  • Appendix
Page 9: Implications of the Global and Regional Changes for Argentina's Foreign Relations

258 R Russell and J G Tokatlian

accepted in Argentina although not without the suspicions that characterize the attitudes

of the weaker party in a bilateral relationship In this context the main challenge for

Brasilia and Buenos Aires is to forge a realistic and positive lsquonew dealrsquo that contemplates

with its own specificity the bilateral relationship as well as Mercosur

In the end the above-mentioned three phases show the existence of both a changing

and intricate relationship If the theory of asymmetry is taken into consideration the first

move towards re-negotiating an unbalanced relationship should be initiated to a large

extent by the less powerful party In that sense it is yet unclear what the Argentine elites

(civilian and military economic and intellectual state-based and non-governmental) want

from relations with the continent (including the United States) the Spanish-speaking

region South America and finally Brazil Historically it has been quite difficult for

Argentines to have simultaneous positive relations with Washington and Brasilia In the

last two decades different opinions (sometimes personal more than collective) between

the lsquoLatin-Americanistsrsquo and the lsquoSouth-Americanistsrsquo favouring opposite strategic

options have been vocally expressed Currently several other countries in the area have

been increasing their leverage especially those facing the Pacific This phenomenon does

not go unnoticed by Argentine elites and is another source of domestic debate In this

dynamic and changing regional context Argentina has not been able to clearly establish

the goals and ambitions to guide its foreign policy towards the region and Brazil in

particular The response to this situation should be sought in essence in domestic politics

Relations with China (and Asia) A Historic and Challenging Opportunity

Argentine ndash Chinese links should be placed in the larger context of China ndashLatin America

relations15 From a Latin American perspective Chinarsquos growing presence in the region

has been seen at least in the first decade of the twenty-first century as a promising trend

Chinarsquos ties with Latin America from the 1950s to the 1970s were marginal focused

primarily on cultural diplomacy driven by ideological motives and based on

revolutionary rhetoric This diplomatic strategy relied on the dividends of destabilization

was accompanied by anti-US slogans and was geared toward strengthening pro-Chinese

(and anti-Soviet) political parties and movements Chinarsquos international behaviour during

that period was that of a revisionist actor who sought to change the rules of the game

through aggressive means

In contrast Beijingrsquos approach to the region since the 1990s has involved an active

economic diplomacy characterized by pragmatism conciliation and stability Chinarsquos key

goal and main challenge has been to deepen its relations with the countries of Latin America

without irritating Washington Diplomatically China has proceeded in a judicious fashion

which explains in part why regional forces did not emerge to veto a policy of prudent and

consistent engagement toward China In addition Chinarsquos external diplomatic model has

been seductive to Latin America especially during the two administrations of George

W Bush in the United States multipolarism as opposed to unipolarism multilateralism as

opposed to unilateralism non-interference as opposed to interventionism soft power as

opposed to hard power pragmatism as opposed to ideologisation collaboration as opposed

to domination and persuasion as opposed to coercion All have been attractive notions in

Latin America Chinarsquos contemporary approach coincides with strong Latin American

traditions and aspirations and has become more captivating by virtue of the mishandling

disregard and thoughtlessness of US foreign policy towards the region

Nothing indicates that Latin America is geared towards accepting a paternalistic

externally-induced security dilemma with China and the region does not feel insecure visshy

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ber

2014

Journal of Iberian and Latin American Research 259

a-vis Beijing despite certain ideologically-driven pressure groups in Washington

Moreover the Sino ndash Latin American ndash US triangular relationship has not engendered

major tensions or unmanageable challenges16 There is also nothing to suggest from a

regional viewpoint that Latin America ndash China ndash United States relations are destined to an

apocalyptic geopolitics approach based on an overblown fear of an alleged Chinese

takeover of the region China is not the Soviet Union post 911 is not a rehearsal of the

Cold War Washington is no longer at the pinnacle of world power and Latin America has

not collapsed after the Western economic and financial crisis began in 2008 There is also

no indication that Chinarsquos intention is to challenge the United States in the Western

Hemisphere In fact the Chinese government has actively sought to convince the United

States and the rest of the world that its intentions are benign thus the self-portrayal of a

peaceful rise

Chinarsquos behaviour in Latin America at the outset of the twenty-first century has been

far from that of a revisionist power On the one hand Beijingrsquos strategy has combined

necessity with opportunity and has been put into practice cautiously and diligently

curtailing the likelihood that the region will develop or adopt a policy aimed at rolling

back Chinarsquos presence On the other hand Latin Americarsquos relationship with Beijing is

more dependent on economic facts than political conceptions As there is no major

ideological concern in most countries about dealing with China the crucial element is the

material effect of Sino ndash Latin American linkages the level of dependency of the region

vis-a-vis China the degree of de-industrialization of the area derived from bilateral trade

and the ecological consequences of Chinese investment in Latin America17

This broader framework is essential to understand the dynamics of Argentinarsquos

relations with China in the larger context of Argentinendash Asian links Over the past two

decades the (re)emergence of China and the ascent of Asia have been a blessing for

Argentina Rising demand and higher prices for commodities have made it possible for

Argentina to elevate and diversify its trade flows with the East Since the 1990s and

despite the discernible differences in economic and foreign policies between Carlos

Menem and the Kirchners Argentina has developed a new pattern of production that has

led notwithstanding the crisis of 2001 to a reorganization of the economic base of the

country As noted by Pablo Gerchunoff lsquoIt is not just about the speed of exports there is

also a significant diversification traditional agriculture new agriculture industry energy

and mining concurred to modify the national economic landscapersquo18 In that context and

according to President Nestor Kirchner it was crucial lsquothrough China to search in Asia the

leverage to re-industrialize Argentinarsquo Economy not politics has been the driving force

to improve and extend Argentine relations with the East19

For the first time in more than seven decades Argentina has met a world that eagerly

requires what it produces The key driver of this demand is located in China but covers a

wide range of countries At present China is Argentinarsquos second largest trading partner

both in terms of the origin of imports and recipient of exports ndash in both dimensions after

Brazil and before the United States (See Table 1) Argentina meanwhile ranks third in the

list of the 15 major suppliers of agricultural products which supplied 90 per cent of

Chinese imports in 2010 United States (244) Brazil (136) and Argentina (73)

Other major suppliers were the European Union (6) Australia (5) and Malaysia (5)

By 2001 Argentine exports to China surpassed the US$1 billion barrier to hit US$1123

billion and imports totalled US$1066 billion Thus there was a small surplus of US$56

million in favour of Argentina By 2010 the commercial exchange was worth US$13795

billion totalling US$6117 billion in Argentine exports and US$7678 billion in Chinese

exports The result was a trade balance of US$1561 billion in Chinarsquos favour20 In the

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260 R Russell and J G Tokatlian

period January ndashSeptember 2011 the surplus in favour of China grew While Argentine

exports amounted to US$4746 billion Chinese exports came to US$7569 billion21

India is Argentinarsquos main Asian trading partner after China22 Other important

countries are Indonesia South Korea Malaysia Vietnam and Thailand23 By 2010 when

China implemented barriers to Argentine soybean oil in retaliation for local action that

prevented the entry of Chinese products into the country Argentina reoriented its soybean

exports to India which bought 14 million tons of soybean oil (corresponding to US$12

billion dollars) In September 2011 Indiarsquos ambassador in Argentina said his country

would increase demand for soybean oil over the next ten years from the current 8 million

to 15 million tons representing a significant additional opportunity for Argentine

producers and exporters24

Indeed ties with Asia are not limited to trade Again the paradigmatic case of this

new relationship is China which in recent years has also emerged as an increasingly

important financial actor During 2009 at a high point of the US-originated financial

crisis China and Argentina agreed to swap US$10 billion worth of their currencies in

order to enable Argentina to avoid using dollars in trade between both countries an

agreement that was the first of this sort between China and a South American country25

Beijing simultaneously accelerated its investment in agriculture mining energy and

banking and has become the third largest investor in the country (See Table 2)26 In

addition there is strong Chinese interest for participation in infrastructure development

projects in sectors such as railways roads ports and telecommunications The largest

food company in China Heilonjiang Beida-Huang signed an October 2010 cooperation

agreement with the province of Rıo Negro27 which provides China with twenty-year

leases on provincial lands (20000 hectares at an early stage that may eventually extend

to up to 320000 hectares)28 In return the Chinese company is committed to

undertaking major irrigation and infrastructure works as part of a ten-year investment of

US$15 billion dollars29 Different actors from Argentina are also opening trade offices

in Chinese cities and several twin cities and sister provinces have signed different 30agreements

In the oil sector the China National Offshore Oil Corporation (CNOOC) acquired 50

per cent of Bridas Corporation and Sinopec holds 100 per cent of Argentine assets in

Occidental In addition China controls 50 per cent of the Cerro Dragon field and will

handle major reserves for 40 years in the province of Santa Cruz To sum up Beijingrsquos

growing interest in Argentina has meant that the country is according to Levi J Jordan

from the Americas Society lsquoreceiving almost half of Chinarsquos investment in South America

over the past two yearsrsquo31 In that context the growth of Chinarsquos state corporations is

impressive32 Agreements have also been made in the field of defence the most prominent

is the signing of the Memorandum of Understanding for Strengthening Exchanges and

Cooperation in Defense of 16 May 2007 whereby both countries have committed to

maintain contacts to discuss global and regional security issues to cooperate on military

equipment and logistics and to establish a Defence Joint Commission It is worth

mentioning that officers from Argentina together with military from Chile and Colombia

frequently (more often than counterparts from Cuba and Venezuela) have attended courses

on grand strategy at Beijingrsquos elite national defence university PLANDU33 Even though

Argentina is not a significant South American buyer of military equipment34 has a very

low annual defence budget and that China is not the major supplier of arms to the region

(as it is the case of the United States Russia and the European Union) it has lately

considered the acquisition of Chinese Z-11 helicopters35 Finally after a July 2012 visit to

China by Argentine Defence Minister Arturo Puricelli both countries agreed that

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2014

Journal of Iberian and Latin American Research 261

Argentina will construct a prototype of that helicopter by 201336 In general the level of

bilateral military dialogue is highly positive37

In key scientific and technological areas there has been an on-going improvement of

relations For example a Satellite Laser Raging (SLR) system designed and made in China

was installed in the Observatory of San Juan University38 Both countries plan to conduct

collaborative activities for Antarctic expedition39 There are many contacts and joint

initiatives in the areas of telecommunications and space40 The two countries are also

interested in creating a Bilateral Centre on Science and Technology for Food41

In addition China will install a satellite station in the province of Neuquen42 while

incrementing its presence in the telecommunications sector and establishing cooperation

ties in the nuclear field43

Argentina and China share important interests in their diplomatic agenda with regards

to the defence of the principle of lsquoterritorial integrityrsquo China consistently supports the

Argentine claim of sovereignty over the MalvinasFalklands while Argentina defends the

policy of lsquoone Chinarsquo which implies the non-recognition of the independence of Taiwan

and Tibet The issue of the MalvinasFalklands Islands has been surfacing for two reasons

On the one hand as Lyle Goldstein has remarked lsquoChinese defence analysts take such

intense interest in the Falkland Warrsquo due to the fact that according to Chinese government

officials and experts there are certain similarities between the Malvinas and Taiwan44 As

Taiwan is a vital issue for Beijing the understanding of the 1982 war in the South Atlantic

is extremely relevant On the other hand the potential closeness of China and Argentina

may provoke in the future a vulnerable situation with regards to the islands that could

affect British defence policy45 In times of a major economic crisis in Europe and with

diminishing possibilities of sustaining high defence budgets retired military officers from

Great Britain overemphasize Londonrsquos potential weakness in the South Atlantic

With respect to issues on the global agenda the two countries agree at the level of the

G-20 on the need for greater participation of emerging nations in international financial

organizations as well as the need to implement measures for the avoidance of financial

speculation that causes volatility in the prices of commodities Both countries have been

supporting peacekeeping operations and they both participate militarily in the UN Mission

in Haiti At the International Atomic Energy Agency Beijing and Buenos Aires have been

active in the promotion of non-proliferation

It is important also to mention a relatively new phenomenon in the relation between

Beijing and Buenos Aires namely Chinese immigration to Argentina There are

approximately 120000 Chinese and Chinese-descendants in Argentina mainly in Buenos

Aires46 Their point of origin is mostly Taiwan and Fujian and to a lesser extent Hong

Kong Even though there are no good estimates or different in-depth studies lsquoChinese

immigration to Argentina is assumed to be largely of illegal naturersquo with lsquoremittances an

important flow of capitalrsquo and Argentina being lsquoan intermediate stoprsquo for approximately

half of the Chinese migrants before seeking entry into the United States (mainly) or the

European Union47

To sum up the capabilities willingness and needs of both sides make the relationship

between Argentina and China (and Asia) complementary The East needs raw materials

(energy food and mining) and Argentina needs investments and infrastructure Of course

a link of this nature presents opportunities but also brings risks It has become fashionable

in Argentina to compare the current situation with the golden years of the lsquospecial

relationshiprsquo with Great Britain (and Europe) that was undoubtedly the engine of the great

Argentine take off between 1880 and 1914 It is also noted that the new relationship with

Asia offers great benefits to the neighbouring countries and therefore does not threaten the

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262 R Russell and J G Tokatlian

harmony existing in the sub-region48 While recognizing the historic opportunity offered

to Argentina by the (re)emergence of China and the advancement of several Asian nations

others emphasize the risks especially those coming from China

Within that context it is relevant to mention that the highly optimistic somehow-naive

phase of Chinese ndash Latin American relations is experiencing changes including in

Argentina ndash China relations Most countries in the region and among them Argentina are

slowly moving from a strategy of lsquoreliable engagementrsquo49 to a more mixed strategy based

on a prudent approach that combines strong commercial ties and active damage-control

policies50 Latin American countries are well aware of the importance of key economic

issues and the sensitive security questions that characterize the regionrsquos relations with

China Concerns about de-industrialization via commodity-based export growth (affecting

basically South America) the effect of global lsquocurrency warsrsquo on the region (affecting all

of Latin America) and the impact of a decisive push for rural production within China

(affecting mainly Mexico and Central America) are extremely critical issues from North to

South America

On a broader outlook the fact that the global system is witnessing a period of

uncertainty is generating a new examination of Chinarsquos lsquowin-winrsquo diplomacy51 This is a

time of difficulties that places limits on Beijingrsquos global and regional strategies Not

surprisingly Argentina as well as other countries in Latin America is rethinking its ties

with China under a more nuanced viewpoint The advantages and dividends of more

commercial and financial links with China are superseded by new productive challenges

(for example excessive emphasis on commodities for export) at home and sensible

differences abroad (for example in the case of human rights) Interests and values are now

inextricably intertwined in Argentine ndash Chinese diplomacy In this context the deployment

of a more sophisticated policy vis-a-vis Beijing seems inevitable Necessity more than

willingness is pressing Buenos Aires to design a broader Asian strategy where China will

be a centrepiece but not the only counterpart politically and materially for the country

Looking Ahead

Argentinarsquos foreign policy developed historically from 1880 until the early twenty-first

century around three areas Europe the United States and Latin America especially the

Southern Cone countries Relations with the socialist world particularly with the Soviet

Union for political and commercial reasons were also important in the second half of the

twentieth century but never reached the scale of the other three axes In the decade since

2000 a fourth axis has been added to this traditional pattern with extraordinary strength

and projection the Asia Pacific region dominated by China

Relations with Europe remain important since there are shared interests and values and

a long history of mutual interaction In addition Argentina continues to need European

investments and technology transfers and the EU is still an important trading partner (See

Table 3) But Europe like Japan and the United States is a market in which exports have

shown in the last decade ceilings that are difficult to overcome The most dynamic and

consolidated markets for Argentina are in Latin America and Asia There are also other

developing markets that are growing at a faster pace than the rest of the world and offer

new opportunities for Argentine exports (Australia Canada Russia South Africa and

Turkey) In the next years Europe will focus its attention on domestic issues and other

areas of the world It is unlikely that any significant progress in the relations with

Argentina and Mercosur could be made in the short run A longer-term view suggests that

Dow

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ber

2014

Journal of Iberian and Latin American Research 263

Europe will increasingly lose its relative importance for Argentina and that its historically

privileged position in the countryrsquos foreign relations will be a thing of the past

Argentinarsquos relations with the United States have never been easy Joseph Tulchin

summarizes its nature in the title of his well-known book Argentina and the United States A Conflicted Relationship52 The strategy of lsquocouplingrsquo implemented during the Menem

years was a pragmatic adaptation to the world of the immediate post-Cold War and was

buried as a strategic option for Argentina with the 2001 crisis In the decade of 2000 the

Kirchners went back to the traditional historical pattern that we have called lsquolimited

oppositionrsquo53 This pattern which combines collaboration and disagreement deference

and resistance will continue to guide Argentinarsquos foreign policy toward Washington but

in a framework in which Buenos Airesrsquos concerns about restraining the United States

preponderance and power will tend to decrease Present conditions offer a great lsquoobjectiversquo

opportunity for the development of new areas of selective collaboration between the two

countries at the bilateral and regional levels A new era of relations with the United States

seems to be beginning for the Southern Cone one that is less unequal and perhaps more

cooperative The key challenge for Argentina is coping with a new reality of diminishing

influence of Washington in the sub-region Most of the time power erosion produces two

alternative behaviours adaptation or denial At least for the time being the relative decline

of US hegemony in South America is showing signs of a lsquosoft landingrsquo If this scenario

prevails then Argentina may manage its bilateral relation with the United States in a more

constructive way

In the case of Brazil it seems that we are entering a second long cycle of convergent

views about the place of this country in Argentinarsquos foreign policy54 This cycle may be

compared and opposed to another long period of convergent visions that characterized the

dominant form in which the neighbour country was perceived by the Argentine elites

during most of the twentieth century Today Brazil is defined as a strategic partner while

in the past until the return of both countries to democracy it was seen as a rival As we

have already mentioned the main challenge for Argentina is how to build this strategic

partnership within a framework of growing asymmetry

The link with Argentina although very important does not have today the same value

for Brazil as in the second half of the eighties By contrast the relationship with Brazil is

increasingly relevant for Argentinarsquos foreign relations and one that presents a significant

challenge In the past the relative symmetry between both countries was a constant source

of suspicion and conflict In the future the condition of asymmetric interdependence as a

structural feature of the relationship will not allow for competition but also is no

guarantee of friendship or cooperation Rather it can become a new source of suspicion

distrust and differences Argentina and Brazil will have to learn to live together in this new

reality and develop a broader framework of mutual understanding to manage the major

density of bilateral links and the global issues of common interests The greatest effort

must come from Argentina because it is the country that has a higher interest in the

relationship and more to gain

Finally the emergence of Asia is offering Argentina a unique opportunity for a

dynamic and successful international integration Its most recent economic dynamism is a

direct result of the increased demand from China and other Asian countries for food and

raw materials However Argentinarsquos exports to Asia are highly concentrated in the

soybean complex and to a much smaller extent in a small group of primary and natural

resource intensive products According to the latest ECLAC report five major products

accounted for 92 of total exports from Argentina to China during the years 2007 ndash 2009

(soybean 531 soybean oil 265 crude oil 747 other cattle 248 and meat and

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2014

264 R Russell and J G Tokatlian

poultry offal 233)55 Moreover the trade surplus with China has tended to evaporate

after several years of significant positive balances

This situation raises many questions about the Argentine specialization pattern ndash

beyond issues related to trade with China ndash and the need to reduce an excessive

dependence on the export of commodities Nevertheless as the benefits of trade with

China have been so high and have also enabled Argentina to successfully face and resist

the financial crises in the centres the propensity to do nothing is great As Eric Farnsworth

recently observed lsquoWhen nations are able to sell as much as they can produce of any

particular product the thinking is generally to continue doing so and reap the rewards

When economies are growing there is little political imperative or incentive for reformrsquo56

In consequence a relevant question surrounding this type of relationship is how to avoid

the temptation to inertia The tendency towards passive repetition is appealing The China

lsquochallengersquo in the early twenty-first century for Argentina is how to think and act

differently from what had been the case of Argentine ndash British relations at the beginning of

the twentieth century The framing of a different link with Beijing as well as the positive

handling of an increasingly complex multifaceted multilevel relationship with Brazil

seem to be the major challenges ahead for Argentinarsquos foreign relations

Notes 1 Roberto Russell and Juan G Tokatlian El lugar de Brasil en la polıtica exterior argentina

Buenos Aires Fondo de Cultura Econo mica 2003 pp 45 ndash 59 2 We use the concept lsquosystemic changesrsquo in the same sense as Robert Gilpin See his book War

and Change in World Politics Cambridge Cambridge University Press 1981 pp 42ndash 43 3 For an interesting analysis of these debates see Jose Paradiso Debates y trayectoria de la

polıtica exterior argentina Buenos Aires Grupo Editor Latinoamericano 1993 4 On the concept lsquoasymmetryrsquo and its implications for bilateral relations see Brantley Womack

lsquoAsymmetry and Systemic Misperception China Vietnam and Cambodia during the 1970rsquosrsquo Journal of Strategic Studies 262 June 2003 pp 92ndash 119

5 On structural and relational power see Susan Strange States and Markets An Introduction to International Political Economy London Pinter 1988 pp 25ndash9

6 David C Kang lsquoThe theoretical roots of hierarchy in international relationsrsquo Australian Journal of International Affairs 583 September 2004 p 339

7 Roberto Russell and Juan G Tokatlian lsquoBeyond Orthodoxy Asserting Latin Americarsquos New Strategic Options Toward the United Statesrsquo Latin America Politics and Society 533 Winter 2011 pp 129 ndash 134

8 Eric Hobsbawm lsquoDespues del siglo XX un mundo en transicionrsquo in Ricardo Lagos (ed) America Latina iquestintegracion o fragmentacion Buenos Aires Edhasa 2008 pp 29ndash 47

9 Remarks by the President of the Argentine Republic Nestor Kirchner at the inauguration of the IV Summit of the Americas Mar del Plata httpwwwsummit-ameicasorgDocuments 20del20presidente20de20RepC3BAblica20Argentinapdf

10 La Nacion (Buenos Aires) lsquoCristina Kirchner critico a Obama con duros terminosrsquo 26 February 2010 Available at httpwwwlanacioncomar1237368-cristina-kirchner-criticoshya-obama-con-duros-terminos accessed 17 November 2011

11 For more in depth analysis of the bilateral relations see Russell and Tokatlian El lugar de Brasil pp 45ndash59 and Roberto Russell and Juan G Tokatlian lsquoPercepcoes argentinas sobre o Brasil ambivalencias e expectativasrsquo Polıtica Externa 202 September 2011 pp 43ndash 56

12 Monica Hirst lsquoLa polıtica sudamericana de Brasil entre el peso de las asimetrıas y la incidencia de nuevas coyunturasrsquo in F Calderon (ed) Escenarios polıticos en America Latina Conceptos metodos y Observatorio Regional Cuadernos de Gobernabilidad Democratica 2 Buenos Aires PNUD Siglo XXI 2008 p 257

13 We use the concept of friendship following Alexander Wendt Social Theory of International Politics Cambridge Cambridge UP 1999 pp 297ndash 308

14 La Nacion Economıa y Negocios Buenos Aires lsquoBrasil en la vida cotidiana argentinarsquo 22 May 2011 p 1

Dow

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ber

2014

Journal of Iberian and Latin American Research 265

15 On China ndash Latin America relations at the beginning of the XXI Century see Juan G Tokatlian lsquoA view from Latin Americarsquo in R Roett and G Paz (eds) Chinarsquos Expansion into the Western Hemisphere Implications for Latin America and the United States Washington DC Brookings Institution Press 2008

16 According toMark P Sullivan a specialist on Latin American affairs at theUS Congressional Research Service lsquoThe balance of opinion toward China and the United States in Latin America tend to be roughly comparable according to a (2007) Pew study Two exceptions are Argentina where China is viewed much more favorably than the United States and in Mexico where the United States is viewed much more favorably than Chinarsquo See Thomas Lum (ed) lsquoComparing Global Influence China and US Diplomacy Foreign Aid Trade and Investment in the Developing Worldrsquo in CRS Report to Congress August 15 2008

17 Kevin Gallagher lsquoLatin Americarsquos China challengersquo 2011 Policy Innovations httpwwwase tuftsedugdaePubsrpGallagher_PolicyInnovationsJan11pdf accessed 18 November 2011

18 Pablo Gerchunoff 2010 lsquoCausas y azares en mas de un siglo de historia econo mica argentinarsquo in R Russell (ed) Argentina 1910ndash2010 Balance de un siglo Buenos Aires Taurus p 152

19 See the complete quote in Sergio Cesarin lsquoChina y Argentina Enfoques y recomendaciones para potenciar la relacion bilateralrsquo Serie Aportes 2010 httplibraryfesdepdf-filesbueros argentinien07560pdf accessed 28 November 2011

20 Based on INDEC 2011 and Comercio Exterior Argentino 2010 httpwwwindecgovar accessed 13 November 2011

21 Camara de Exportadores de la Republica Argentina En Contcto China No 43 November 2011 p 16

22 In October 2009 President Cristina Fernandez de Kirchner visited India It was her first trip to an Asian country after her inauguration in December 2007 and it was the first visit of an Argentine president to India since 1994

23 It is important to mention the cases of Indonesia and Vietnam for two reasons the growth of trade in the last decade and the fact Argentine exports to these two countries are mainly nonshytraditional commodities For example exports to Indonesia jumped fromUS$43million in 2001 to US$852 million in 2010 while exports to Vietnam grew from US$60 million in 2001 to US $654 million in 2010 Cların iEco Buenos Aires lsquoArgentina en mas puertosrsquo 28 August 2011

24 La Nacion Economıa y Negocios Buenos Aires lsquoLa soja argentina ahora apunta a la Indiarsquo 15 September 2011 p 3

25 China Daily lsquoArgentina China sign tentative swap dealrsquo 31 March 2009 httpwww chinadailycomcnchina2009-0331content_7635007htm accessed 11 November 2011

26 Argenpress (Buenos Aires) lsquoInversiones chinas en la Argentina Claves del nuevo escenario energeticorsquo 14 June 2011 httpwwwargenpressinfo201106inversiones-chinas-enshyargentina-claveshtml accessed 19 November 2011

27 See text of the agreement at httpwwwgrrorgarrionegro-chinaacuerdo-saiz-chinapdf accessed 26 Nov 2011 and El Cronista Buenos Aires lsquoChina invierte 1500 millones en Rıo Negro para asegurarse alimentosrsquo 9 June 2011 httpwwwcronistacomnegocios China-invierte-us-1500-millones-en-Rio-Negro-para-asegurarse-alimentos-20110609-0033 html accessed 19 November 2011

28 On other actual and potential Chinese investments in Argentine provinces see Camara Argentino China Negocios con China 2011 httpwwwargenchinaorgarticulos_2010 NegociosConChinapdf accessed 14 November 2011 and FUNDAMIN lsquoChina invierte en las 23 provincias argentinasrsquo httpfundamincomaresinfo36-exportaciones-e-importaciones 299-china-invierte-en-las-23-provincias-argentinashtml accessed 19 November 2011

29 httpwwwnoalaminaorgmineria-informacion-generalgeneralargentina-china-recreacionshyde-la-vieja-qrelacion-especialq-con-gran-bretana accessed 20 January 2012

30 lsquoLas relaciones entre China y Argentinarsquo httpespanolcricn1161201211281s264119 htm accessed 17 November 2011

31 lsquoRailway rapprochement China invests in Argentinarsquo 2010 httpwwwas-coaorgarticles 2528Railway_Rapprochement_China_Invests_in_Argentina accessed 17 Nov 2011

32 Silvia Simonit lsquoLas empresas chinas en Argentinarsquo Chinese Studies Working Paper Series (Universitat Pompeu Fabra) No 1 2011

33 Loro Horta lsquoIn Uncle Samrsquos Backyard Chinarsquos Military Influence in Latin Americarsquo Military Review September-October 2008 p 48

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ovem

ber

2014

266 R Russell and J G Tokatlian

34 As are the cases of Brazil Chile Colombia and Venezuela 35 Seguridad y Defensa lsquoEl Ejercito Negocia con China la compra de helico pterosrsquo 10 October

2010 httpwwwseguridadydefensacomarnoticiasejercito-negocia-con-china-la-comprashyde-helicopteros-25059html accessed 10 November 2011

36 httpwwwelmetroonlinecomarindexphpoption frac14com_k2ampviewfrac14 itemampidfrac141067 purishycelli-firmC3B3-convenio-de-defensa-con-chinaampItemid frac14238 accessed 12 September 2012

37 China Military Online lsquoChang Wanquan holds talks with Argentine deputy Defense ministerrsquo 28 November 2011 httpengchinamilcomcnnews-channelschina-militaryshynews2011-1128content_4725893htm accessed 29 November 2011

38 T Wang et lsquoNew SRL station running in San Juan of Argentinarsquo Crustal Dynamics Data Information System nd httpcddisgsfcnasagovlw15docspapersNew20SLR20Station 20Running20in20San20Juan20of20Argentinapdf accessed 9 November 2011

39 Chinese Academy of Sciences lsquoChina Argentina to strengthen cooperation on Antarctic expeditionrsquo 16 August 2010 httpenglishbiccascnNE201008t20100816_57510html accessed 29 November 2011

40 Janie Hulse lsquoChinarsquos Expansion into and US withdrawal from Argentinarsquos telecommunicashytions and space industries and the implications for US national securityrsquo Strategic Studies Institute September 2007 httpwwwstrategicstudiesinstitutearmymilpdffilespub806pdf accessed 7 November 2011

41 Ministry of Science and Technology lsquoChina y la Argentina se reu nen para desarrollar un Centro Binacionalrsquo 2011 httpwwwmincytgovaragendaagenda_detalle phpid_ agendafrac1435 accessed 16 November 2011

42 httpwwwlmneuquencomarnoticias201282avanza-instalacion-de-una-estacion-satel ital-de-china-en-la-provincia_156999 accessed 14 October 2012

43 httpwwwstrategicstudiesinstitutearmymilpubssummarycfmqfrac14 806 accessed 29 November 2011 httpenergyseenewscomnewsargentina-china-sign-nuclear-coop eration-agreement-306141 accessed 3 November 2012

44 For the major reasons that motivated this interest see Lyle Goldstein lsquoChinarsquos Falklands Lessonsrsquo Survival 503 2008 pp 65-66

45 UKNDA Inconvenient Truths Threats Justify Prioritising Defence London UKNDA 2011 p 24

46 La Nacion Buenos Aires lsquoVivir en la Argentina estudiar en Chinarsquo 11 October 2011 http wwwlanacioncomar1413556-vivir-en-la-argentina-estudiar-en-china accessed 9 Novemshyber 2011

47 G M Calderon lsquoInmigracion china en las Americas Comparacion de las experiencias en Canada y Argentinarsquo Revista Argentina de Estudios Canadienses No 2 2008 p 30

48 La Nacion Buenos Aires lsquoChina Una oportunidad histo ricarsquo 26 July 2011 49 Juan Tokatlian lsquoLatin America China and the United States A Hopeful Trianglersquo 2007

Open Democracy httpwwwopendemocracynetdemocracy-protesthopeful_triangle_ 4336jsp accessed 4 November 2011

50 La Nacion Buenos Aires lsquoUna nueva estrategia hacia Chinarsquo 29 August 2011 51 Brantley Womack lsquoBeyond Win-Win Rethinking International Relationships in an Era of

Economic Uncertaintyrsquo Paper presented to the International Conference on the Chinese Models of Development Domestic and Global Aspects Taipei Taiwan September 2011

52 Joseph Tulchin Argentina and the United States A Conflicted Relationship New York Macmillan 1990

53 Russell and Tokatlian lsquoBeyond Orthodoxyrsquo 54 According to the latest report of Latinobaro metro 52 of the Argentines consider Brazil as

the main leader of Latin America while only 2 gives that condition to the United States http wwwlatinobarometroorglatinoLATContenidosjsp accessed 23 November 2011

55 Osvaldo Rosales lsquoLa Republica Popular China y America Latina y el Caribe Hacia una nueva fase en el vınculo econo mico comercialrsquo 2011 ECLAC httpwwweclacorgpubl icacionesxml643666La_Republica_Popular _China_y_America_Latina_y_el_Caribe _ tradepdf accessed 10 November 2011

56 Eric Farnsworth 2011 lsquoThe New Mercantilism Chinarsquos Emerging Role in the Americasrsquo Current History February Available at httpwwwas coaorgarticles2982The_New_shyMercantilism_Chinas_Emerging_Role_in_the_Americas accessed 28 November 2011

Dow

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ded

by [

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02

37 0

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ovem

ber

2014

Journal of Iberian and Latin American Research 267

Appendix 1

Table 1

Argentinean trade with Brazil in millions of dollars 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Exports 6206 4828 4666 5587 6335 8141 10498 13272 11374 14420 Imports 5230 2517 4700 7567 10187 11749 14523 17687 11822 17658 Trade 975 2310 233 21980 23852 23608 24025 24415 2448 23238 balance

Argentinean trade with the United States in millions of dollars 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Exports 2840 2869 3364 3733 4493 4025 4153 5095 3465 3656 Imports 3737 1789 2238 3389 3998 4247 5264 6894 5106 6125 Trade 2897 1080 1126 344 495 2222 21111 21799 21641 22469 balance

Argentinean trade with China in millions of dollars 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Exports 1123 1092 2483 2628 3193 3476 5170 6355 3668 6117 Imports 1066 330 721 1402 2237 3122 5093 7104 4823 7678 Trade 56 762 1762 1227 956 354 77 2 749 2 1155 2 1561 balance

Source INDEC and UNCTAD

Table 2

FDI stock in Argentina by country of origin in millions of dollars (selected countries) 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

USA 16422 7476 7989 10277 11689 12208 13601 13930 14012 14814 of total 238 231 208 182 187 176 175 172 175 168

Brazil 1953 2108 3280 1773 2488 2810 3659 4969 4319 5367 of total 283 651 856 314 397 406 470 614 539 608

China no data no data no data 13 11 45 120 141 123 5500 of total no data no data no data 002 002 006 015 017 015 623

Total 68935 32403 38323 56554 62639 69292 77899 80941 80144 88249

for the years 2001 2002 and 2003 the data for Brazil includes all FDI from South America excluding ChileFrom 2003 onwards the data is exclusively for BrazilSource INDEC and UNCTAD

Table 3

Argentinean trade with the European Union in millions of dollars 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Exports 4698 5309 6079 6209 6844 8010 9901 13173 10278 11026 Imports 4717 2107 2814 4237 4830 5811 7442 9043 6434 7587 Trade 219 3201 3265 1972 2013 2199 2458 4130 3845 3439 balance

FDI from the European Union in Argentina in millions of dollars 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

FDI 38279 18284 21273 33001 36848 40408 45159 45070 44963 47605 of total 5553 5643 5551 5835 5883 5832 5797 5568 5610 5394 Total 68935 32403 38323 56554 62639 69292 77899 80941 80144 88249

Source INDEC and UNCTAD

Dow

nloa

ded

by [

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erlin

] at

02

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ovem

ber

2014

  • Abstract
  • The United States and Brazil Losing and Gaining Centrality
  • Relations with China (and Asia) A Historic and Challenging Opportunity
  • Looking Ahead
  • Notes
  • Appendix
Page 10: Implications of the Global and Regional Changes for Argentina's Foreign Relations

Journal of Iberian and Latin American Research 259

a-vis Beijing despite certain ideologically-driven pressure groups in Washington

Moreover the Sino ndash Latin American ndash US triangular relationship has not engendered

major tensions or unmanageable challenges16 There is also nothing to suggest from a

regional viewpoint that Latin America ndash China ndash United States relations are destined to an

apocalyptic geopolitics approach based on an overblown fear of an alleged Chinese

takeover of the region China is not the Soviet Union post 911 is not a rehearsal of the

Cold War Washington is no longer at the pinnacle of world power and Latin America has

not collapsed after the Western economic and financial crisis began in 2008 There is also

no indication that Chinarsquos intention is to challenge the United States in the Western

Hemisphere In fact the Chinese government has actively sought to convince the United

States and the rest of the world that its intentions are benign thus the self-portrayal of a

peaceful rise

Chinarsquos behaviour in Latin America at the outset of the twenty-first century has been

far from that of a revisionist power On the one hand Beijingrsquos strategy has combined

necessity with opportunity and has been put into practice cautiously and diligently

curtailing the likelihood that the region will develop or adopt a policy aimed at rolling

back Chinarsquos presence On the other hand Latin Americarsquos relationship with Beijing is

more dependent on economic facts than political conceptions As there is no major

ideological concern in most countries about dealing with China the crucial element is the

material effect of Sino ndash Latin American linkages the level of dependency of the region

vis-a-vis China the degree of de-industrialization of the area derived from bilateral trade

and the ecological consequences of Chinese investment in Latin America17

This broader framework is essential to understand the dynamics of Argentinarsquos

relations with China in the larger context of Argentinendash Asian links Over the past two

decades the (re)emergence of China and the ascent of Asia have been a blessing for

Argentina Rising demand and higher prices for commodities have made it possible for

Argentina to elevate and diversify its trade flows with the East Since the 1990s and

despite the discernible differences in economic and foreign policies between Carlos

Menem and the Kirchners Argentina has developed a new pattern of production that has

led notwithstanding the crisis of 2001 to a reorganization of the economic base of the

country As noted by Pablo Gerchunoff lsquoIt is not just about the speed of exports there is

also a significant diversification traditional agriculture new agriculture industry energy

and mining concurred to modify the national economic landscapersquo18 In that context and

according to President Nestor Kirchner it was crucial lsquothrough China to search in Asia the

leverage to re-industrialize Argentinarsquo Economy not politics has been the driving force

to improve and extend Argentine relations with the East19

For the first time in more than seven decades Argentina has met a world that eagerly

requires what it produces The key driver of this demand is located in China but covers a

wide range of countries At present China is Argentinarsquos second largest trading partner

both in terms of the origin of imports and recipient of exports ndash in both dimensions after

Brazil and before the United States (See Table 1) Argentina meanwhile ranks third in the

list of the 15 major suppliers of agricultural products which supplied 90 per cent of

Chinese imports in 2010 United States (244) Brazil (136) and Argentina (73)

Other major suppliers were the European Union (6) Australia (5) and Malaysia (5)

By 2001 Argentine exports to China surpassed the US$1 billion barrier to hit US$1123

billion and imports totalled US$1066 billion Thus there was a small surplus of US$56

million in favour of Argentina By 2010 the commercial exchange was worth US$13795

billion totalling US$6117 billion in Argentine exports and US$7678 billion in Chinese

exports The result was a trade balance of US$1561 billion in Chinarsquos favour20 In the

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260 R Russell and J G Tokatlian

period January ndashSeptember 2011 the surplus in favour of China grew While Argentine

exports amounted to US$4746 billion Chinese exports came to US$7569 billion21

India is Argentinarsquos main Asian trading partner after China22 Other important

countries are Indonesia South Korea Malaysia Vietnam and Thailand23 By 2010 when

China implemented barriers to Argentine soybean oil in retaliation for local action that

prevented the entry of Chinese products into the country Argentina reoriented its soybean

exports to India which bought 14 million tons of soybean oil (corresponding to US$12

billion dollars) In September 2011 Indiarsquos ambassador in Argentina said his country

would increase demand for soybean oil over the next ten years from the current 8 million

to 15 million tons representing a significant additional opportunity for Argentine

producers and exporters24

Indeed ties with Asia are not limited to trade Again the paradigmatic case of this

new relationship is China which in recent years has also emerged as an increasingly

important financial actor During 2009 at a high point of the US-originated financial

crisis China and Argentina agreed to swap US$10 billion worth of their currencies in

order to enable Argentina to avoid using dollars in trade between both countries an

agreement that was the first of this sort between China and a South American country25

Beijing simultaneously accelerated its investment in agriculture mining energy and

banking and has become the third largest investor in the country (See Table 2)26 In

addition there is strong Chinese interest for participation in infrastructure development

projects in sectors such as railways roads ports and telecommunications The largest

food company in China Heilonjiang Beida-Huang signed an October 2010 cooperation

agreement with the province of Rıo Negro27 which provides China with twenty-year

leases on provincial lands (20000 hectares at an early stage that may eventually extend

to up to 320000 hectares)28 In return the Chinese company is committed to

undertaking major irrigation and infrastructure works as part of a ten-year investment of

US$15 billion dollars29 Different actors from Argentina are also opening trade offices

in Chinese cities and several twin cities and sister provinces have signed different 30agreements

In the oil sector the China National Offshore Oil Corporation (CNOOC) acquired 50

per cent of Bridas Corporation and Sinopec holds 100 per cent of Argentine assets in

Occidental In addition China controls 50 per cent of the Cerro Dragon field and will

handle major reserves for 40 years in the province of Santa Cruz To sum up Beijingrsquos

growing interest in Argentina has meant that the country is according to Levi J Jordan

from the Americas Society lsquoreceiving almost half of Chinarsquos investment in South America

over the past two yearsrsquo31 In that context the growth of Chinarsquos state corporations is

impressive32 Agreements have also been made in the field of defence the most prominent

is the signing of the Memorandum of Understanding for Strengthening Exchanges and

Cooperation in Defense of 16 May 2007 whereby both countries have committed to

maintain contacts to discuss global and regional security issues to cooperate on military

equipment and logistics and to establish a Defence Joint Commission It is worth

mentioning that officers from Argentina together with military from Chile and Colombia

frequently (more often than counterparts from Cuba and Venezuela) have attended courses

on grand strategy at Beijingrsquos elite national defence university PLANDU33 Even though

Argentina is not a significant South American buyer of military equipment34 has a very

low annual defence budget and that China is not the major supplier of arms to the region

(as it is the case of the United States Russia and the European Union) it has lately

considered the acquisition of Chinese Z-11 helicopters35 Finally after a July 2012 visit to

China by Argentine Defence Minister Arturo Puricelli both countries agreed that

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2014

Journal of Iberian and Latin American Research 261

Argentina will construct a prototype of that helicopter by 201336 In general the level of

bilateral military dialogue is highly positive37

In key scientific and technological areas there has been an on-going improvement of

relations For example a Satellite Laser Raging (SLR) system designed and made in China

was installed in the Observatory of San Juan University38 Both countries plan to conduct

collaborative activities for Antarctic expedition39 There are many contacts and joint

initiatives in the areas of telecommunications and space40 The two countries are also

interested in creating a Bilateral Centre on Science and Technology for Food41

In addition China will install a satellite station in the province of Neuquen42 while

incrementing its presence in the telecommunications sector and establishing cooperation

ties in the nuclear field43

Argentina and China share important interests in their diplomatic agenda with regards

to the defence of the principle of lsquoterritorial integrityrsquo China consistently supports the

Argentine claim of sovereignty over the MalvinasFalklands while Argentina defends the

policy of lsquoone Chinarsquo which implies the non-recognition of the independence of Taiwan

and Tibet The issue of the MalvinasFalklands Islands has been surfacing for two reasons

On the one hand as Lyle Goldstein has remarked lsquoChinese defence analysts take such

intense interest in the Falkland Warrsquo due to the fact that according to Chinese government

officials and experts there are certain similarities between the Malvinas and Taiwan44 As

Taiwan is a vital issue for Beijing the understanding of the 1982 war in the South Atlantic

is extremely relevant On the other hand the potential closeness of China and Argentina

may provoke in the future a vulnerable situation with regards to the islands that could

affect British defence policy45 In times of a major economic crisis in Europe and with

diminishing possibilities of sustaining high defence budgets retired military officers from

Great Britain overemphasize Londonrsquos potential weakness in the South Atlantic

With respect to issues on the global agenda the two countries agree at the level of the

G-20 on the need for greater participation of emerging nations in international financial

organizations as well as the need to implement measures for the avoidance of financial

speculation that causes volatility in the prices of commodities Both countries have been

supporting peacekeeping operations and they both participate militarily in the UN Mission

in Haiti At the International Atomic Energy Agency Beijing and Buenos Aires have been

active in the promotion of non-proliferation

It is important also to mention a relatively new phenomenon in the relation between

Beijing and Buenos Aires namely Chinese immigration to Argentina There are

approximately 120000 Chinese and Chinese-descendants in Argentina mainly in Buenos

Aires46 Their point of origin is mostly Taiwan and Fujian and to a lesser extent Hong

Kong Even though there are no good estimates or different in-depth studies lsquoChinese

immigration to Argentina is assumed to be largely of illegal naturersquo with lsquoremittances an

important flow of capitalrsquo and Argentina being lsquoan intermediate stoprsquo for approximately

half of the Chinese migrants before seeking entry into the United States (mainly) or the

European Union47

To sum up the capabilities willingness and needs of both sides make the relationship

between Argentina and China (and Asia) complementary The East needs raw materials

(energy food and mining) and Argentina needs investments and infrastructure Of course

a link of this nature presents opportunities but also brings risks It has become fashionable

in Argentina to compare the current situation with the golden years of the lsquospecial

relationshiprsquo with Great Britain (and Europe) that was undoubtedly the engine of the great

Argentine take off between 1880 and 1914 It is also noted that the new relationship with

Asia offers great benefits to the neighbouring countries and therefore does not threaten the

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2014

262 R Russell and J G Tokatlian

harmony existing in the sub-region48 While recognizing the historic opportunity offered

to Argentina by the (re)emergence of China and the advancement of several Asian nations

others emphasize the risks especially those coming from China

Within that context it is relevant to mention that the highly optimistic somehow-naive

phase of Chinese ndash Latin American relations is experiencing changes including in

Argentina ndash China relations Most countries in the region and among them Argentina are

slowly moving from a strategy of lsquoreliable engagementrsquo49 to a more mixed strategy based

on a prudent approach that combines strong commercial ties and active damage-control

policies50 Latin American countries are well aware of the importance of key economic

issues and the sensitive security questions that characterize the regionrsquos relations with

China Concerns about de-industrialization via commodity-based export growth (affecting

basically South America) the effect of global lsquocurrency warsrsquo on the region (affecting all

of Latin America) and the impact of a decisive push for rural production within China

(affecting mainly Mexico and Central America) are extremely critical issues from North to

South America

On a broader outlook the fact that the global system is witnessing a period of

uncertainty is generating a new examination of Chinarsquos lsquowin-winrsquo diplomacy51 This is a

time of difficulties that places limits on Beijingrsquos global and regional strategies Not

surprisingly Argentina as well as other countries in Latin America is rethinking its ties

with China under a more nuanced viewpoint The advantages and dividends of more

commercial and financial links with China are superseded by new productive challenges

(for example excessive emphasis on commodities for export) at home and sensible

differences abroad (for example in the case of human rights) Interests and values are now

inextricably intertwined in Argentine ndash Chinese diplomacy In this context the deployment

of a more sophisticated policy vis-a-vis Beijing seems inevitable Necessity more than

willingness is pressing Buenos Aires to design a broader Asian strategy where China will

be a centrepiece but not the only counterpart politically and materially for the country

Looking Ahead

Argentinarsquos foreign policy developed historically from 1880 until the early twenty-first

century around three areas Europe the United States and Latin America especially the

Southern Cone countries Relations with the socialist world particularly with the Soviet

Union for political and commercial reasons were also important in the second half of the

twentieth century but never reached the scale of the other three axes In the decade since

2000 a fourth axis has been added to this traditional pattern with extraordinary strength

and projection the Asia Pacific region dominated by China

Relations with Europe remain important since there are shared interests and values and

a long history of mutual interaction In addition Argentina continues to need European

investments and technology transfers and the EU is still an important trading partner (See

Table 3) But Europe like Japan and the United States is a market in which exports have

shown in the last decade ceilings that are difficult to overcome The most dynamic and

consolidated markets for Argentina are in Latin America and Asia There are also other

developing markets that are growing at a faster pace than the rest of the world and offer

new opportunities for Argentine exports (Australia Canada Russia South Africa and

Turkey) In the next years Europe will focus its attention on domestic issues and other

areas of the world It is unlikely that any significant progress in the relations with

Argentina and Mercosur could be made in the short run A longer-term view suggests that

Dow

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ber

2014

Journal of Iberian and Latin American Research 263

Europe will increasingly lose its relative importance for Argentina and that its historically

privileged position in the countryrsquos foreign relations will be a thing of the past

Argentinarsquos relations with the United States have never been easy Joseph Tulchin

summarizes its nature in the title of his well-known book Argentina and the United States A Conflicted Relationship52 The strategy of lsquocouplingrsquo implemented during the Menem

years was a pragmatic adaptation to the world of the immediate post-Cold War and was

buried as a strategic option for Argentina with the 2001 crisis In the decade of 2000 the

Kirchners went back to the traditional historical pattern that we have called lsquolimited

oppositionrsquo53 This pattern which combines collaboration and disagreement deference

and resistance will continue to guide Argentinarsquos foreign policy toward Washington but

in a framework in which Buenos Airesrsquos concerns about restraining the United States

preponderance and power will tend to decrease Present conditions offer a great lsquoobjectiversquo

opportunity for the development of new areas of selective collaboration between the two

countries at the bilateral and regional levels A new era of relations with the United States

seems to be beginning for the Southern Cone one that is less unequal and perhaps more

cooperative The key challenge for Argentina is coping with a new reality of diminishing

influence of Washington in the sub-region Most of the time power erosion produces two

alternative behaviours adaptation or denial At least for the time being the relative decline

of US hegemony in South America is showing signs of a lsquosoft landingrsquo If this scenario

prevails then Argentina may manage its bilateral relation with the United States in a more

constructive way

In the case of Brazil it seems that we are entering a second long cycle of convergent

views about the place of this country in Argentinarsquos foreign policy54 This cycle may be

compared and opposed to another long period of convergent visions that characterized the

dominant form in which the neighbour country was perceived by the Argentine elites

during most of the twentieth century Today Brazil is defined as a strategic partner while

in the past until the return of both countries to democracy it was seen as a rival As we

have already mentioned the main challenge for Argentina is how to build this strategic

partnership within a framework of growing asymmetry

The link with Argentina although very important does not have today the same value

for Brazil as in the second half of the eighties By contrast the relationship with Brazil is

increasingly relevant for Argentinarsquos foreign relations and one that presents a significant

challenge In the past the relative symmetry between both countries was a constant source

of suspicion and conflict In the future the condition of asymmetric interdependence as a

structural feature of the relationship will not allow for competition but also is no

guarantee of friendship or cooperation Rather it can become a new source of suspicion

distrust and differences Argentina and Brazil will have to learn to live together in this new

reality and develop a broader framework of mutual understanding to manage the major

density of bilateral links and the global issues of common interests The greatest effort

must come from Argentina because it is the country that has a higher interest in the

relationship and more to gain

Finally the emergence of Asia is offering Argentina a unique opportunity for a

dynamic and successful international integration Its most recent economic dynamism is a

direct result of the increased demand from China and other Asian countries for food and

raw materials However Argentinarsquos exports to Asia are highly concentrated in the

soybean complex and to a much smaller extent in a small group of primary and natural

resource intensive products According to the latest ECLAC report five major products

accounted for 92 of total exports from Argentina to China during the years 2007 ndash 2009

(soybean 531 soybean oil 265 crude oil 747 other cattle 248 and meat and

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ber

2014

264 R Russell and J G Tokatlian

poultry offal 233)55 Moreover the trade surplus with China has tended to evaporate

after several years of significant positive balances

This situation raises many questions about the Argentine specialization pattern ndash

beyond issues related to trade with China ndash and the need to reduce an excessive

dependence on the export of commodities Nevertheless as the benefits of trade with

China have been so high and have also enabled Argentina to successfully face and resist

the financial crises in the centres the propensity to do nothing is great As Eric Farnsworth

recently observed lsquoWhen nations are able to sell as much as they can produce of any

particular product the thinking is generally to continue doing so and reap the rewards

When economies are growing there is little political imperative or incentive for reformrsquo56

In consequence a relevant question surrounding this type of relationship is how to avoid

the temptation to inertia The tendency towards passive repetition is appealing The China

lsquochallengersquo in the early twenty-first century for Argentina is how to think and act

differently from what had been the case of Argentine ndash British relations at the beginning of

the twentieth century The framing of a different link with Beijing as well as the positive

handling of an increasingly complex multifaceted multilevel relationship with Brazil

seem to be the major challenges ahead for Argentinarsquos foreign relations

Notes 1 Roberto Russell and Juan G Tokatlian El lugar de Brasil en la polıtica exterior argentina

Buenos Aires Fondo de Cultura Econo mica 2003 pp 45 ndash 59 2 We use the concept lsquosystemic changesrsquo in the same sense as Robert Gilpin See his book War

and Change in World Politics Cambridge Cambridge University Press 1981 pp 42ndash 43 3 For an interesting analysis of these debates see Jose Paradiso Debates y trayectoria de la

polıtica exterior argentina Buenos Aires Grupo Editor Latinoamericano 1993 4 On the concept lsquoasymmetryrsquo and its implications for bilateral relations see Brantley Womack

lsquoAsymmetry and Systemic Misperception China Vietnam and Cambodia during the 1970rsquosrsquo Journal of Strategic Studies 262 June 2003 pp 92ndash 119

5 On structural and relational power see Susan Strange States and Markets An Introduction to International Political Economy London Pinter 1988 pp 25ndash9

6 David C Kang lsquoThe theoretical roots of hierarchy in international relationsrsquo Australian Journal of International Affairs 583 September 2004 p 339

7 Roberto Russell and Juan G Tokatlian lsquoBeyond Orthodoxy Asserting Latin Americarsquos New Strategic Options Toward the United Statesrsquo Latin America Politics and Society 533 Winter 2011 pp 129 ndash 134

8 Eric Hobsbawm lsquoDespues del siglo XX un mundo en transicionrsquo in Ricardo Lagos (ed) America Latina iquestintegracion o fragmentacion Buenos Aires Edhasa 2008 pp 29ndash 47

9 Remarks by the President of the Argentine Republic Nestor Kirchner at the inauguration of the IV Summit of the Americas Mar del Plata httpwwwsummit-ameicasorgDocuments 20del20presidente20de20RepC3BAblica20Argentinapdf

10 La Nacion (Buenos Aires) lsquoCristina Kirchner critico a Obama con duros terminosrsquo 26 February 2010 Available at httpwwwlanacioncomar1237368-cristina-kirchner-criticoshya-obama-con-duros-terminos accessed 17 November 2011

11 For more in depth analysis of the bilateral relations see Russell and Tokatlian El lugar de Brasil pp 45ndash59 and Roberto Russell and Juan G Tokatlian lsquoPercepcoes argentinas sobre o Brasil ambivalencias e expectativasrsquo Polıtica Externa 202 September 2011 pp 43ndash 56

12 Monica Hirst lsquoLa polıtica sudamericana de Brasil entre el peso de las asimetrıas y la incidencia de nuevas coyunturasrsquo in F Calderon (ed) Escenarios polıticos en America Latina Conceptos metodos y Observatorio Regional Cuadernos de Gobernabilidad Democratica 2 Buenos Aires PNUD Siglo XXI 2008 p 257

13 We use the concept of friendship following Alexander Wendt Social Theory of International Politics Cambridge Cambridge UP 1999 pp 297ndash 308

14 La Nacion Economıa y Negocios Buenos Aires lsquoBrasil en la vida cotidiana argentinarsquo 22 May 2011 p 1

Dow

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ber

2014

Journal of Iberian and Latin American Research 265

15 On China ndash Latin America relations at the beginning of the XXI Century see Juan G Tokatlian lsquoA view from Latin Americarsquo in R Roett and G Paz (eds) Chinarsquos Expansion into the Western Hemisphere Implications for Latin America and the United States Washington DC Brookings Institution Press 2008

16 According toMark P Sullivan a specialist on Latin American affairs at theUS Congressional Research Service lsquoThe balance of opinion toward China and the United States in Latin America tend to be roughly comparable according to a (2007) Pew study Two exceptions are Argentina where China is viewed much more favorably than the United States and in Mexico where the United States is viewed much more favorably than Chinarsquo See Thomas Lum (ed) lsquoComparing Global Influence China and US Diplomacy Foreign Aid Trade and Investment in the Developing Worldrsquo in CRS Report to Congress August 15 2008

17 Kevin Gallagher lsquoLatin Americarsquos China challengersquo 2011 Policy Innovations httpwwwase tuftsedugdaePubsrpGallagher_PolicyInnovationsJan11pdf accessed 18 November 2011

18 Pablo Gerchunoff 2010 lsquoCausas y azares en mas de un siglo de historia econo mica argentinarsquo in R Russell (ed) Argentina 1910ndash2010 Balance de un siglo Buenos Aires Taurus p 152

19 See the complete quote in Sergio Cesarin lsquoChina y Argentina Enfoques y recomendaciones para potenciar la relacion bilateralrsquo Serie Aportes 2010 httplibraryfesdepdf-filesbueros argentinien07560pdf accessed 28 November 2011

20 Based on INDEC 2011 and Comercio Exterior Argentino 2010 httpwwwindecgovar accessed 13 November 2011

21 Camara de Exportadores de la Republica Argentina En Contcto China No 43 November 2011 p 16

22 In October 2009 President Cristina Fernandez de Kirchner visited India It was her first trip to an Asian country after her inauguration in December 2007 and it was the first visit of an Argentine president to India since 1994

23 It is important to mention the cases of Indonesia and Vietnam for two reasons the growth of trade in the last decade and the fact Argentine exports to these two countries are mainly nonshytraditional commodities For example exports to Indonesia jumped fromUS$43million in 2001 to US$852 million in 2010 while exports to Vietnam grew from US$60 million in 2001 to US $654 million in 2010 Cların iEco Buenos Aires lsquoArgentina en mas puertosrsquo 28 August 2011

24 La Nacion Economıa y Negocios Buenos Aires lsquoLa soja argentina ahora apunta a la Indiarsquo 15 September 2011 p 3

25 China Daily lsquoArgentina China sign tentative swap dealrsquo 31 March 2009 httpwww chinadailycomcnchina2009-0331content_7635007htm accessed 11 November 2011

26 Argenpress (Buenos Aires) lsquoInversiones chinas en la Argentina Claves del nuevo escenario energeticorsquo 14 June 2011 httpwwwargenpressinfo201106inversiones-chinas-enshyargentina-claveshtml accessed 19 November 2011

27 See text of the agreement at httpwwwgrrorgarrionegro-chinaacuerdo-saiz-chinapdf accessed 26 Nov 2011 and El Cronista Buenos Aires lsquoChina invierte 1500 millones en Rıo Negro para asegurarse alimentosrsquo 9 June 2011 httpwwwcronistacomnegocios China-invierte-us-1500-millones-en-Rio-Negro-para-asegurarse-alimentos-20110609-0033 html accessed 19 November 2011

28 On other actual and potential Chinese investments in Argentine provinces see Camara Argentino China Negocios con China 2011 httpwwwargenchinaorgarticulos_2010 NegociosConChinapdf accessed 14 November 2011 and FUNDAMIN lsquoChina invierte en las 23 provincias argentinasrsquo httpfundamincomaresinfo36-exportaciones-e-importaciones 299-china-invierte-en-las-23-provincias-argentinashtml accessed 19 November 2011

29 httpwwwnoalaminaorgmineria-informacion-generalgeneralargentina-china-recreacionshyde-la-vieja-qrelacion-especialq-con-gran-bretana accessed 20 January 2012

30 lsquoLas relaciones entre China y Argentinarsquo httpespanolcricn1161201211281s264119 htm accessed 17 November 2011

31 lsquoRailway rapprochement China invests in Argentinarsquo 2010 httpwwwas-coaorgarticles 2528Railway_Rapprochement_China_Invests_in_Argentina accessed 17 Nov 2011

32 Silvia Simonit lsquoLas empresas chinas en Argentinarsquo Chinese Studies Working Paper Series (Universitat Pompeu Fabra) No 1 2011

33 Loro Horta lsquoIn Uncle Samrsquos Backyard Chinarsquos Military Influence in Latin Americarsquo Military Review September-October 2008 p 48

Dow

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ovem

ber

2014

266 R Russell and J G Tokatlian

34 As are the cases of Brazil Chile Colombia and Venezuela 35 Seguridad y Defensa lsquoEl Ejercito Negocia con China la compra de helico pterosrsquo 10 October

2010 httpwwwseguridadydefensacomarnoticiasejercito-negocia-con-china-la-comprashyde-helicopteros-25059html accessed 10 November 2011

36 httpwwwelmetroonlinecomarindexphpoption frac14com_k2ampviewfrac14 itemampidfrac141067 purishycelli-firmC3B3-convenio-de-defensa-con-chinaampItemid frac14238 accessed 12 September 2012

37 China Military Online lsquoChang Wanquan holds talks with Argentine deputy Defense ministerrsquo 28 November 2011 httpengchinamilcomcnnews-channelschina-militaryshynews2011-1128content_4725893htm accessed 29 November 2011

38 T Wang et lsquoNew SRL station running in San Juan of Argentinarsquo Crustal Dynamics Data Information System nd httpcddisgsfcnasagovlw15docspapersNew20SLR20Station 20Running20in20San20Juan20of20Argentinapdf accessed 9 November 2011

39 Chinese Academy of Sciences lsquoChina Argentina to strengthen cooperation on Antarctic expeditionrsquo 16 August 2010 httpenglishbiccascnNE201008t20100816_57510html accessed 29 November 2011

40 Janie Hulse lsquoChinarsquos Expansion into and US withdrawal from Argentinarsquos telecommunicashytions and space industries and the implications for US national securityrsquo Strategic Studies Institute September 2007 httpwwwstrategicstudiesinstitutearmymilpdffilespub806pdf accessed 7 November 2011

41 Ministry of Science and Technology lsquoChina y la Argentina se reu nen para desarrollar un Centro Binacionalrsquo 2011 httpwwwmincytgovaragendaagenda_detalle phpid_ agendafrac1435 accessed 16 November 2011

42 httpwwwlmneuquencomarnoticias201282avanza-instalacion-de-una-estacion-satel ital-de-china-en-la-provincia_156999 accessed 14 October 2012

43 httpwwwstrategicstudiesinstitutearmymilpubssummarycfmqfrac14 806 accessed 29 November 2011 httpenergyseenewscomnewsargentina-china-sign-nuclear-coop eration-agreement-306141 accessed 3 November 2012

44 For the major reasons that motivated this interest see Lyle Goldstein lsquoChinarsquos Falklands Lessonsrsquo Survival 503 2008 pp 65-66

45 UKNDA Inconvenient Truths Threats Justify Prioritising Defence London UKNDA 2011 p 24

46 La Nacion Buenos Aires lsquoVivir en la Argentina estudiar en Chinarsquo 11 October 2011 http wwwlanacioncomar1413556-vivir-en-la-argentina-estudiar-en-china accessed 9 Novemshyber 2011

47 G M Calderon lsquoInmigracion china en las Americas Comparacion de las experiencias en Canada y Argentinarsquo Revista Argentina de Estudios Canadienses No 2 2008 p 30

48 La Nacion Buenos Aires lsquoChina Una oportunidad histo ricarsquo 26 July 2011 49 Juan Tokatlian lsquoLatin America China and the United States A Hopeful Trianglersquo 2007

Open Democracy httpwwwopendemocracynetdemocracy-protesthopeful_triangle_ 4336jsp accessed 4 November 2011

50 La Nacion Buenos Aires lsquoUna nueva estrategia hacia Chinarsquo 29 August 2011 51 Brantley Womack lsquoBeyond Win-Win Rethinking International Relationships in an Era of

Economic Uncertaintyrsquo Paper presented to the International Conference on the Chinese Models of Development Domestic and Global Aspects Taipei Taiwan September 2011

52 Joseph Tulchin Argentina and the United States A Conflicted Relationship New York Macmillan 1990

53 Russell and Tokatlian lsquoBeyond Orthodoxyrsquo 54 According to the latest report of Latinobaro metro 52 of the Argentines consider Brazil as

the main leader of Latin America while only 2 gives that condition to the United States http wwwlatinobarometroorglatinoLATContenidosjsp accessed 23 November 2011

55 Osvaldo Rosales lsquoLa Republica Popular China y America Latina y el Caribe Hacia una nueva fase en el vınculo econo mico comercialrsquo 2011 ECLAC httpwwweclacorgpubl icacionesxml643666La_Republica_Popular _China_y_America_Latina_y_el_Caribe _ tradepdf accessed 10 November 2011

56 Eric Farnsworth 2011 lsquoThe New Mercantilism Chinarsquos Emerging Role in the Americasrsquo Current History February Available at httpwwwas coaorgarticles2982The_New_shyMercantilism_Chinas_Emerging_Role_in_the_Americas accessed 28 November 2011

Dow

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ded

by [

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02

37 0

5 N

ovem

ber

2014

Journal of Iberian and Latin American Research 267

Appendix 1

Table 1

Argentinean trade with Brazil in millions of dollars 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Exports 6206 4828 4666 5587 6335 8141 10498 13272 11374 14420 Imports 5230 2517 4700 7567 10187 11749 14523 17687 11822 17658 Trade 975 2310 233 21980 23852 23608 24025 24415 2448 23238 balance

Argentinean trade with the United States in millions of dollars 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Exports 2840 2869 3364 3733 4493 4025 4153 5095 3465 3656 Imports 3737 1789 2238 3389 3998 4247 5264 6894 5106 6125 Trade 2897 1080 1126 344 495 2222 21111 21799 21641 22469 balance

Argentinean trade with China in millions of dollars 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Exports 1123 1092 2483 2628 3193 3476 5170 6355 3668 6117 Imports 1066 330 721 1402 2237 3122 5093 7104 4823 7678 Trade 56 762 1762 1227 956 354 77 2 749 2 1155 2 1561 balance

Source INDEC and UNCTAD

Table 2

FDI stock in Argentina by country of origin in millions of dollars (selected countries) 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

USA 16422 7476 7989 10277 11689 12208 13601 13930 14012 14814 of total 238 231 208 182 187 176 175 172 175 168

Brazil 1953 2108 3280 1773 2488 2810 3659 4969 4319 5367 of total 283 651 856 314 397 406 470 614 539 608

China no data no data no data 13 11 45 120 141 123 5500 of total no data no data no data 002 002 006 015 017 015 623

Total 68935 32403 38323 56554 62639 69292 77899 80941 80144 88249

for the years 2001 2002 and 2003 the data for Brazil includes all FDI from South America excluding ChileFrom 2003 onwards the data is exclusively for BrazilSource INDEC and UNCTAD

Table 3

Argentinean trade with the European Union in millions of dollars 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Exports 4698 5309 6079 6209 6844 8010 9901 13173 10278 11026 Imports 4717 2107 2814 4237 4830 5811 7442 9043 6434 7587 Trade 219 3201 3265 1972 2013 2199 2458 4130 3845 3439 balance

FDI from the European Union in Argentina in millions of dollars 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

FDI 38279 18284 21273 33001 36848 40408 45159 45070 44963 47605 of total 5553 5643 5551 5835 5883 5832 5797 5568 5610 5394 Total 68935 32403 38323 56554 62639 69292 77899 80941 80144 88249

Source INDEC and UNCTAD

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2014

  • Abstract
  • The United States and Brazil Losing and Gaining Centrality
  • Relations with China (and Asia) A Historic and Challenging Opportunity
  • Looking Ahead
  • Notes
  • Appendix
Page 11: Implications of the Global and Regional Changes for Argentina's Foreign Relations

260 R Russell and J G Tokatlian

period January ndashSeptember 2011 the surplus in favour of China grew While Argentine

exports amounted to US$4746 billion Chinese exports came to US$7569 billion21

India is Argentinarsquos main Asian trading partner after China22 Other important

countries are Indonesia South Korea Malaysia Vietnam and Thailand23 By 2010 when

China implemented barriers to Argentine soybean oil in retaliation for local action that

prevented the entry of Chinese products into the country Argentina reoriented its soybean

exports to India which bought 14 million tons of soybean oil (corresponding to US$12

billion dollars) In September 2011 Indiarsquos ambassador in Argentina said his country

would increase demand for soybean oil over the next ten years from the current 8 million

to 15 million tons representing a significant additional opportunity for Argentine

producers and exporters24

Indeed ties with Asia are not limited to trade Again the paradigmatic case of this

new relationship is China which in recent years has also emerged as an increasingly

important financial actor During 2009 at a high point of the US-originated financial

crisis China and Argentina agreed to swap US$10 billion worth of their currencies in

order to enable Argentina to avoid using dollars in trade between both countries an

agreement that was the first of this sort between China and a South American country25

Beijing simultaneously accelerated its investment in agriculture mining energy and

banking and has become the third largest investor in the country (See Table 2)26 In

addition there is strong Chinese interest for participation in infrastructure development

projects in sectors such as railways roads ports and telecommunications The largest

food company in China Heilonjiang Beida-Huang signed an October 2010 cooperation

agreement with the province of Rıo Negro27 which provides China with twenty-year

leases on provincial lands (20000 hectares at an early stage that may eventually extend

to up to 320000 hectares)28 In return the Chinese company is committed to

undertaking major irrigation and infrastructure works as part of a ten-year investment of

US$15 billion dollars29 Different actors from Argentina are also opening trade offices

in Chinese cities and several twin cities and sister provinces have signed different 30agreements

In the oil sector the China National Offshore Oil Corporation (CNOOC) acquired 50

per cent of Bridas Corporation and Sinopec holds 100 per cent of Argentine assets in

Occidental In addition China controls 50 per cent of the Cerro Dragon field and will

handle major reserves for 40 years in the province of Santa Cruz To sum up Beijingrsquos

growing interest in Argentina has meant that the country is according to Levi J Jordan

from the Americas Society lsquoreceiving almost half of Chinarsquos investment in South America

over the past two yearsrsquo31 In that context the growth of Chinarsquos state corporations is

impressive32 Agreements have also been made in the field of defence the most prominent

is the signing of the Memorandum of Understanding for Strengthening Exchanges and

Cooperation in Defense of 16 May 2007 whereby both countries have committed to

maintain contacts to discuss global and regional security issues to cooperate on military

equipment and logistics and to establish a Defence Joint Commission It is worth

mentioning that officers from Argentina together with military from Chile and Colombia

frequently (more often than counterparts from Cuba and Venezuela) have attended courses

on grand strategy at Beijingrsquos elite national defence university PLANDU33 Even though

Argentina is not a significant South American buyer of military equipment34 has a very

low annual defence budget and that China is not the major supplier of arms to the region

(as it is the case of the United States Russia and the European Union) it has lately

considered the acquisition of Chinese Z-11 helicopters35 Finally after a July 2012 visit to

China by Argentine Defence Minister Arturo Puricelli both countries agreed that

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2014

Journal of Iberian and Latin American Research 261

Argentina will construct a prototype of that helicopter by 201336 In general the level of

bilateral military dialogue is highly positive37

In key scientific and technological areas there has been an on-going improvement of

relations For example a Satellite Laser Raging (SLR) system designed and made in China

was installed in the Observatory of San Juan University38 Both countries plan to conduct

collaborative activities for Antarctic expedition39 There are many contacts and joint

initiatives in the areas of telecommunications and space40 The two countries are also

interested in creating a Bilateral Centre on Science and Technology for Food41

In addition China will install a satellite station in the province of Neuquen42 while

incrementing its presence in the telecommunications sector and establishing cooperation

ties in the nuclear field43

Argentina and China share important interests in their diplomatic agenda with regards

to the defence of the principle of lsquoterritorial integrityrsquo China consistently supports the

Argentine claim of sovereignty over the MalvinasFalklands while Argentina defends the

policy of lsquoone Chinarsquo which implies the non-recognition of the independence of Taiwan

and Tibet The issue of the MalvinasFalklands Islands has been surfacing for two reasons

On the one hand as Lyle Goldstein has remarked lsquoChinese defence analysts take such

intense interest in the Falkland Warrsquo due to the fact that according to Chinese government

officials and experts there are certain similarities between the Malvinas and Taiwan44 As

Taiwan is a vital issue for Beijing the understanding of the 1982 war in the South Atlantic

is extremely relevant On the other hand the potential closeness of China and Argentina

may provoke in the future a vulnerable situation with regards to the islands that could

affect British defence policy45 In times of a major economic crisis in Europe and with

diminishing possibilities of sustaining high defence budgets retired military officers from

Great Britain overemphasize Londonrsquos potential weakness in the South Atlantic

With respect to issues on the global agenda the two countries agree at the level of the

G-20 on the need for greater participation of emerging nations in international financial

organizations as well as the need to implement measures for the avoidance of financial

speculation that causes volatility in the prices of commodities Both countries have been

supporting peacekeeping operations and they both participate militarily in the UN Mission

in Haiti At the International Atomic Energy Agency Beijing and Buenos Aires have been

active in the promotion of non-proliferation

It is important also to mention a relatively new phenomenon in the relation between

Beijing and Buenos Aires namely Chinese immigration to Argentina There are

approximately 120000 Chinese and Chinese-descendants in Argentina mainly in Buenos

Aires46 Their point of origin is mostly Taiwan and Fujian and to a lesser extent Hong

Kong Even though there are no good estimates or different in-depth studies lsquoChinese

immigration to Argentina is assumed to be largely of illegal naturersquo with lsquoremittances an

important flow of capitalrsquo and Argentina being lsquoan intermediate stoprsquo for approximately

half of the Chinese migrants before seeking entry into the United States (mainly) or the

European Union47

To sum up the capabilities willingness and needs of both sides make the relationship

between Argentina and China (and Asia) complementary The East needs raw materials

(energy food and mining) and Argentina needs investments and infrastructure Of course

a link of this nature presents opportunities but also brings risks It has become fashionable

in Argentina to compare the current situation with the golden years of the lsquospecial

relationshiprsquo with Great Britain (and Europe) that was undoubtedly the engine of the great

Argentine take off between 1880 and 1914 It is also noted that the new relationship with

Asia offers great benefits to the neighbouring countries and therefore does not threaten the

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ber

2014

262 R Russell and J G Tokatlian

harmony existing in the sub-region48 While recognizing the historic opportunity offered

to Argentina by the (re)emergence of China and the advancement of several Asian nations

others emphasize the risks especially those coming from China

Within that context it is relevant to mention that the highly optimistic somehow-naive

phase of Chinese ndash Latin American relations is experiencing changes including in

Argentina ndash China relations Most countries in the region and among them Argentina are

slowly moving from a strategy of lsquoreliable engagementrsquo49 to a more mixed strategy based

on a prudent approach that combines strong commercial ties and active damage-control

policies50 Latin American countries are well aware of the importance of key economic

issues and the sensitive security questions that characterize the regionrsquos relations with

China Concerns about de-industrialization via commodity-based export growth (affecting

basically South America) the effect of global lsquocurrency warsrsquo on the region (affecting all

of Latin America) and the impact of a decisive push for rural production within China

(affecting mainly Mexico and Central America) are extremely critical issues from North to

South America

On a broader outlook the fact that the global system is witnessing a period of

uncertainty is generating a new examination of Chinarsquos lsquowin-winrsquo diplomacy51 This is a

time of difficulties that places limits on Beijingrsquos global and regional strategies Not

surprisingly Argentina as well as other countries in Latin America is rethinking its ties

with China under a more nuanced viewpoint The advantages and dividends of more

commercial and financial links with China are superseded by new productive challenges

(for example excessive emphasis on commodities for export) at home and sensible

differences abroad (for example in the case of human rights) Interests and values are now

inextricably intertwined in Argentine ndash Chinese diplomacy In this context the deployment

of a more sophisticated policy vis-a-vis Beijing seems inevitable Necessity more than

willingness is pressing Buenos Aires to design a broader Asian strategy where China will

be a centrepiece but not the only counterpart politically and materially for the country

Looking Ahead

Argentinarsquos foreign policy developed historically from 1880 until the early twenty-first

century around three areas Europe the United States and Latin America especially the

Southern Cone countries Relations with the socialist world particularly with the Soviet

Union for political and commercial reasons were also important in the second half of the

twentieth century but never reached the scale of the other three axes In the decade since

2000 a fourth axis has been added to this traditional pattern with extraordinary strength

and projection the Asia Pacific region dominated by China

Relations with Europe remain important since there are shared interests and values and

a long history of mutual interaction In addition Argentina continues to need European

investments and technology transfers and the EU is still an important trading partner (See

Table 3) But Europe like Japan and the United States is a market in which exports have

shown in the last decade ceilings that are difficult to overcome The most dynamic and

consolidated markets for Argentina are in Latin America and Asia There are also other

developing markets that are growing at a faster pace than the rest of the world and offer

new opportunities for Argentine exports (Australia Canada Russia South Africa and

Turkey) In the next years Europe will focus its attention on domestic issues and other

areas of the world It is unlikely that any significant progress in the relations with

Argentina and Mercosur could be made in the short run A longer-term view suggests that

Dow

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ber

2014

Journal of Iberian and Latin American Research 263

Europe will increasingly lose its relative importance for Argentina and that its historically

privileged position in the countryrsquos foreign relations will be a thing of the past

Argentinarsquos relations with the United States have never been easy Joseph Tulchin

summarizes its nature in the title of his well-known book Argentina and the United States A Conflicted Relationship52 The strategy of lsquocouplingrsquo implemented during the Menem

years was a pragmatic adaptation to the world of the immediate post-Cold War and was

buried as a strategic option for Argentina with the 2001 crisis In the decade of 2000 the

Kirchners went back to the traditional historical pattern that we have called lsquolimited

oppositionrsquo53 This pattern which combines collaboration and disagreement deference

and resistance will continue to guide Argentinarsquos foreign policy toward Washington but

in a framework in which Buenos Airesrsquos concerns about restraining the United States

preponderance and power will tend to decrease Present conditions offer a great lsquoobjectiversquo

opportunity for the development of new areas of selective collaboration between the two

countries at the bilateral and regional levels A new era of relations with the United States

seems to be beginning for the Southern Cone one that is less unequal and perhaps more

cooperative The key challenge for Argentina is coping with a new reality of diminishing

influence of Washington in the sub-region Most of the time power erosion produces two

alternative behaviours adaptation or denial At least for the time being the relative decline

of US hegemony in South America is showing signs of a lsquosoft landingrsquo If this scenario

prevails then Argentina may manage its bilateral relation with the United States in a more

constructive way

In the case of Brazil it seems that we are entering a second long cycle of convergent

views about the place of this country in Argentinarsquos foreign policy54 This cycle may be

compared and opposed to another long period of convergent visions that characterized the

dominant form in which the neighbour country was perceived by the Argentine elites

during most of the twentieth century Today Brazil is defined as a strategic partner while

in the past until the return of both countries to democracy it was seen as a rival As we

have already mentioned the main challenge for Argentina is how to build this strategic

partnership within a framework of growing asymmetry

The link with Argentina although very important does not have today the same value

for Brazil as in the second half of the eighties By contrast the relationship with Brazil is

increasingly relevant for Argentinarsquos foreign relations and one that presents a significant

challenge In the past the relative symmetry between both countries was a constant source

of suspicion and conflict In the future the condition of asymmetric interdependence as a

structural feature of the relationship will not allow for competition but also is no

guarantee of friendship or cooperation Rather it can become a new source of suspicion

distrust and differences Argentina and Brazil will have to learn to live together in this new

reality and develop a broader framework of mutual understanding to manage the major

density of bilateral links and the global issues of common interests The greatest effort

must come from Argentina because it is the country that has a higher interest in the

relationship and more to gain

Finally the emergence of Asia is offering Argentina a unique opportunity for a

dynamic and successful international integration Its most recent economic dynamism is a

direct result of the increased demand from China and other Asian countries for food and

raw materials However Argentinarsquos exports to Asia are highly concentrated in the

soybean complex and to a much smaller extent in a small group of primary and natural

resource intensive products According to the latest ECLAC report five major products

accounted for 92 of total exports from Argentina to China during the years 2007 ndash 2009

(soybean 531 soybean oil 265 crude oil 747 other cattle 248 and meat and

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2014

264 R Russell and J G Tokatlian

poultry offal 233)55 Moreover the trade surplus with China has tended to evaporate

after several years of significant positive balances

This situation raises many questions about the Argentine specialization pattern ndash

beyond issues related to trade with China ndash and the need to reduce an excessive

dependence on the export of commodities Nevertheless as the benefits of trade with

China have been so high and have also enabled Argentina to successfully face and resist

the financial crises in the centres the propensity to do nothing is great As Eric Farnsworth

recently observed lsquoWhen nations are able to sell as much as they can produce of any

particular product the thinking is generally to continue doing so and reap the rewards

When economies are growing there is little political imperative or incentive for reformrsquo56

In consequence a relevant question surrounding this type of relationship is how to avoid

the temptation to inertia The tendency towards passive repetition is appealing The China

lsquochallengersquo in the early twenty-first century for Argentina is how to think and act

differently from what had been the case of Argentine ndash British relations at the beginning of

the twentieth century The framing of a different link with Beijing as well as the positive

handling of an increasingly complex multifaceted multilevel relationship with Brazil

seem to be the major challenges ahead for Argentinarsquos foreign relations

Notes 1 Roberto Russell and Juan G Tokatlian El lugar de Brasil en la polıtica exterior argentina

Buenos Aires Fondo de Cultura Econo mica 2003 pp 45 ndash 59 2 We use the concept lsquosystemic changesrsquo in the same sense as Robert Gilpin See his book War

and Change in World Politics Cambridge Cambridge University Press 1981 pp 42ndash 43 3 For an interesting analysis of these debates see Jose Paradiso Debates y trayectoria de la

polıtica exterior argentina Buenos Aires Grupo Editor Latinoamericano 1993 4 On the concept lsquoasymmetryrsquo and its implications for bilateral relations see Brantley Womack

lsquoAsymmetry and Systemic Misperception China Vietnam and Cambodia during the 1970rsquosrsquo Journal of Strategic Studies 262 June 2003 pp 92ndash 119

5 On structural and relational power see Susan Strange States and Markets An Introduction to International Political Economy London Pinter 1988 pp 25ndash9

6 David C Kang lsquoThe theoretical roots of hierarchy in international relationsrsquo Australian Journal of International Affairs 583 September 2004 p 339

7 Roberto Russell and Juan G Tokatlian lsquoBeyond Orthodoxy Asserting Latin Americarsquos New Strategic Options Toward the United Statesrsquo Latin America Politics and Society 533 Winter 2011 pp 129 ndash 134

8 Eric Hobsbawm lsquoDespues del siglo XX un mundo en transicionrsquo in Ricardo Lagos (ed) America Latina iquestintegracion o fragmentacion Buenos Aires Edhasa 2008 pp 29ndash 47

9 Remarks by the President of the Argentine Republic Nestor Kirchner at the inauguration of the IV Summit of the Americas Mar del Plata httpwwwsummit-ameicasorgDocuments 20del20presidente20de20RepC3BAblica20Argentinapdf

10 La Nacion (Buenos Aires) lsquoCristina Kirchner critico a Obama con duros terminosrsquo 26 February 2010 Available at httpwwwlanacioncomar1237368-cristina-kirchner-criticoshya-obama-con-duros-terminos accessed 17 November 2011

11 For more in depth analysis of the bilateral relations see Russell and Tokatlian El lugar de Brasil pp 45ndash59 and Roberto Russell and Juan G Tokatlian lsquoPercepcoes argentinas sobre o Brasil ambivalencias e expectativasrsquo Polıtica Externa 202 September 2011 pp 43ndash 56

12 Monica Hirst lsquoLa polıtica sudamericana de Brasil entre el peso de las asimetrıas y la incidencia de nuevas coyunturasrsquo in F Calderon (ed) Escenarios polıticos en America Latina Conceptos metodos y Observatorio Regional Cuadernos de Gobernabilidad Democratica 2 Buenos Aires PNUD Siglo XXI 2008 p 257

13 We use the concept of friendship following Alexander Wendt Social Theory of International Politics Cambridge Cambridge UP 1999 pp 297ndash 308

14 La Nacion Economıa y Negocios Buenos Aires lsquoBrasil en la vida cotidiana argentinarsquo 22 May 2011 p 1

Dow

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ber

2014

Journal of Iberian and Latin American Research 265

15 On China ndash Latin America relations at the beginning of the XXI Century see Juan G Tokatlian lsquoA view from Latin Americarsquo in R Roett and G Paz (eds) Chinarsquos Expansion into the Western Hemisphere Implications for Latin America and the United States Washington DC Brookings Institution Press 2008

16 According toMark P Sullivan a specialist on Latin American affairs at theUS Congressional Research Service lsquoThe balance of opinion toward China and the United States in Latin America tend to be roughly comparable according to a (2007) Pew study Two exceptions are Argentina where China is viewed much more favorably than the United States and in Mexico where the United States is viewed much more favorably than Chinarsquo See Thomas Lum (ed) lsquoComparing Global Influence China and US Diplomacy Foreign Aid Trade and Investment in the Developing Worldrsquo in CRS Report to Congress August 15 2008

17 Kevin Gallagher lsquoLatin Americarsquos China challengersquo 2011 Policy Innovations httpwwwase tuftsedugdaePubsrpGallagher_PolicyInnovationsJan11pdf accessed 18 November 2011

18 Pablo Gerchunoff 2010 lsquoCausas y azares en mas de un siglo de historia econo mica argentinarsquo in R Russell (ed) Argentina 1910ndash2010 Balance de un siglo Buenos Aires Taurus p 152

19 See the complete quote in Sergio Cesarin lsquoChina y Argentina Enfoques y recomendaciones para potenciar la relacion bilateralrsquo Serie Aportes 2010 httplibraryfesdepdf-filesbueros argentinien07560pdf accessed 28 November 2011

20 Based on INDEC 2011 and Comercio Exterior Argentino 2010 httpwwwindecgovar accessed 13 November 2011

21 Camara de Exportadores de la Republica Argentina En Contcto China No 43 November 2011 p 16

22 In October 2009 President Cristina Fernandez de Kirchner visited India It was her first trip to an Asian country after her inauguration in December 2007 and it was the first visit of an Argentine president to India since 1994

23 It is important to mention the cases of Indonesia and Vietnam for two reasons the growth of trade in the last decade and the fact Argentine exports to these two countries are mainly nonshytraditional commodities For example exports to Indonesia jumped fromUS$43million in 2001 to US$852 million in 2010 while exports to Vietnam grew from US$60 million in 2001 to US $654 million in 2010 Cların iEco Buenos Aires lsquoArgentina en mas puertosrsquo 28 August 2011

24 La Nacion Economıa y Negocios Buenos Aires lsquoLa soja argentina ahora apunta a la Indiarsquo 15 September 2011 p 3

25 China Daily lsquoArgentina China sign tentative swap dealrsquo 31 March 2009 httpwww chinadailycomcnchina2009-0331content_7635007htm accessed 11 November 2011

26 Argenpress (Buenos Aires) lsquoInversiones chinas en la Argentina Claves del nuevo escenario energeticorsquo 14 June 2011 httpwwwargenpressinfo201106inversiones-chinas-enshyargentina-claveshtml accessed 19 November 2011

27 See text of the agreement at httpwwwgrrorgarrionegro-chinaacuerdo-saiz-chinapdf accessed 26 Nov 2011 and El Cronista Buenos Aires lsquoChina invierte 1500 millones en Rıo Negro para asegurarse alimentosrsquo 9 June 2011 httpwwwcronistacomnegocios China-invierte-us-1500-millones-en-Rio-Negro-para-asegurarse-alimentos-20110609-0033 html accessed 19 November 2011

28 On other actual and potential Chinese investments in Argentine provinces see Camara Argentino China Negocios con China 2011 httpwwwargenchinaorgarticulos_2010 NegociosConChinapdf accessed 14 November 2011 and FUNDAMIN lsquoChina invierte en las 23 provincias argentinasrsquo httpfundamincomaresinfo36-exportaciones-e-importaciones 299-china-invierte-en-las-23-provincias-argentinashtml accessed 19 November 2011

29 httpwwwnoalaminaorgmineria-informacion-generalgeneralargentina-china-recreacionshyde-la-vieja-qrelacion-especialq-con-gran-bretana accessed 20 January 2012

30 lsquoLas relaciones entre China y Argentinarsquo httpespanolcricn1161201211281s264119 htm accessed 17 November 2011

31 lsquoRailway rapprochement China invests in Argentinarsquo 2010 httpwwwas-coaorgarticles 2528Railway_Rapprochement_China_Invests_in_Argentina accessed 17 Nov 2011

32 Silvia Simonit lsquoLas empresas chinas en Argentinarsquo Chinese Studies Working Paper Series (Universitat Pompeu Fabra) No 1 2011

33 Loro Horta lsquoIn Uncle Samrsquos Backyard Chinarsquos Military Influence in Latin Americarsquo Military Review September-October 2008 p 48

Dow

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ovem

ber

2014

266 R Russell and J G Tokatlian

34 As are the cases of Brazil Chile Colombia and Venezuela 35 Seguridad y Defensa lsquoEl Ejercito Negocia con China la compra de helico pterosrsquo 10 October

2010 httpwwwseguridadydefensacomarnoticiasejercito-negocia-con-china-la-comprashyde-helicopteros-25059html accessed 10 November 2011

36 httpwwwelmetroonlinecomarindexphpoption frac14com_k2ampviewfrac14 itemampidfrac141067 purishycelli-firmC3B3-convenio-de-defensa-con-chinaampItemid frac14238 accessed 12 September 2012

37 China Military Online lsquoChang Wanquan holds talks with Argentine deputy Defense ministerrsquo 28 November 2011 httpengchinamilcomcnnews-channelschina-militaryshynews2011-1128content_4725893htm accessed 29 November 2011

38 T Wang et lsquoNew SRL station running in San Juan of Argentinarsquo Crustal Dynamics Data Information System nd httpcddisgsfcnasagovlw15docspapersNew20SLR20Station 20Running20in20San20Juan20of20Argentinapdf accessed 9 November 2011

39 Chinese Academy of Sciences lsquoChina Argentina to strengthen cooperation on Antarctic expeditionrsquo 16 August 2010 httpenglishbiccascnNE201008t20100816_57510html accessed 29 November 2011

40 Janie Hulse lsquoChinarsquos Expansion into and US withdrawal from Argentinarsquos telecommunicashytions and space industries and the implications for US national securityrsquo Strategic Studies Institute September 2007 httpwwwstrategicstudiesinstitutearmymilpdffilespub806pdf accessed 7 November 2011

41 Ministry of Science and Technology lsquoChina y la Argentina se reu nen para desarrollar un Centro Binacionalrsquo 2011 httpwwwmincytgovaragendaagenda_detalle phpid_ agendafrac1435 accessed 16 November 2011

42 httpwwwlmneuquencomarnoticias201282avanza-instalacion-de-una-estacion-satel ital-de-china-en-la-provincia_156999 accessed 14 October 2012

43 httpwwwstrategicstudiesinstitutearmymilpubssummarycfmqfrac14 806 accessed 29 November 2011 httpenergyseenewscomnewsargentina-china-sign-nuclear-coop eration-agreement-306141 accessed 3 November 2012

44 For the major reasons that motivated this interest see Lyle Goldstein lsquoChinarsquos Falklands Lessonsrsquo Survival 503 2008 pp 65-66

45 UKNDA Inconvenient Truths Threats Justify Prioritising Defence London UKNDA 2011 p 24

46 La Nacion Buenos Aires lsquoVivir en la Argentina estudiar en Chinarsquo 11 October 2011 http wwwlanacioncomar1413556-vivir-en-la-argentina-estudiar-en-china accessed 9 Novemshyber 2011

47 G M Calderon lsquoInmigracion china en las Americas Comparacion de las experiencias en Canada y Argentinarsquo Revista Argentina de Estudios Canadienses No 2 2008 p 30

48 La Nacion Buenos Aires lsquoChina Una oportunidad histo ricarsquo 26 July 2011 49 Juan Tokatlian lsquoLatin America China and the United States A Hopeful Trianglersquo 2007

Open Democracy httpwwwopendemocracynetdemocracy-protesthopeful_triangle_ 4336jsp accessed 4 November 2011

50 La Nacion Buenos Aires lsquoUna nueva estrategia hacia Chinarsquo 29 August 2011 51 Brantley Womack lsquoBeyond Win-Win Rethinking International Relationships in an Era of

Economic Uncertaintyrsquo Paper presented to the International Conference on the Chinese Models of Development Domestic and Global Aspects Taipei Taiwan September 2011

52 Joseph Tulchin Argentina and the United States A Conflicted Relationship New York Macmillan 1990

53 Russell and Tokatlian lsquoBeyond Orthodoxyrsquo 54 According to the latest report of Latinobaro metro 52 of the Argentines consider Brazil as

the main leader of Latin America while only 2 gives that condition to the United States http wwwlatinobarometroorglatinoLATContenidosjsp accessed 23 November 2011

55 Osvaldo Rosales lsquoLa Republica Popular China y America Latina y el Caribe Hacia una nueva fase en el vınculo econo mico comercialrsquo 2011 ECLAC httpwwweclacorgpubl icacionesxml643666La_Republica_Popular _China_y_America_Latina_y_el_Caribe _ tradepdf accessed 10 November 2011

56 Eric Farnsworth 2011 lsquoThe New Mercantilism Chinarsquos Emerging Role in the Americasrsquo Current History February Available at httpwwwas coaorgarticles2982The_New_shyMercantilism_Chinas_Emerging_Role_in_the_Americas accessed 28 November 2011

Dow

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ded

by [

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02

37 0

5 N

ovem

ber

2014

Journal of Iberian and Latin American Research 267

Appendix 1

Table 1

Argentinean trade with Brazil in millions of dollars 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Exports 6206 4828 4666 5587 6335 8141 10498 13272 11374 14420 Imports 5230 2517 4700 7567 10187 11749 14523 17687 11822 17658 Trade 975 2310 233 21980 23852 23608 24025 24415 2448 23238 balance

Argentinean trade with the United States in millions of dollars 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Exports 2840 2869 3364 3733 4493 4025 4153 5095 3465 3656 Imports 3737 1789 2238 3389 3998 4247 5264 6894 5106 6125 Trade 2897 1080 1126 344 495 2222 21111 21799 21641 22469 balance

Argentinean trade with China in millions of dollars 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Exports 1123 1092 2483 2628 3193 3476 5170 6355 3668 6117 Imports 1066 330 721 1402 2237 3122 5093 7104 4823 7678 Trade 56 762 1762 1227 956 354 77 2 749 2 1155 2 1561 balance

Source INDEC and UNCTAD

Table 2

FDI stock in Argentina by country of origin in millions of dollars (selected countries) 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

USA 16422 7476 7989 10277 11689 12208 13601 13930 14012 14814 of total 238 231 208 182 187 176 175 172 175 168

Brazil 1953 2108 3280 1773 2488 2810 3659 4969 4319 5367 of total 283 651 856 314 397 406 470 614 539 608

China no data no data no data 13 11 45 120 141 123 5500 of total no data no data no data 002 002 006 015 017 015 623

Total 68935 32403 38323 56554 62639 69292 77899 80941 80144 88249

for the years 2001 2002 and 2003 the data for Brazil includes all FDI from South America excluding ChileFrom 2003 onwards the data is exclusively for BrazilSource INDEC and UNCTAD

Table 3

Argentinean trade with the European Union in millions of dollars 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Exports 4698 5309 6079 6209 6844 8010 9901 13173 10278 11026 Imports 4717 2107 2814 4237 4830 5811 7442 9043 6434 7587 Trade 219 3201 3265 1972 2013 2199 2458 4130 3845 3439 balance

FDI from the European Union in Argentina in millions of dollars 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

FDI 38279 18284 21273 33001 36848 40408 45159 45070 44963 47605 of total 5553 5643 5551 5835 5883 5832 5797 5568 5610 5394 Total 68935 32403 38323 56554 62639 69292 77899 80941 80144 88249

Source INDEC and UNCTAD

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2014

  • Abstract
  • The United States and Brazil Losing and Gaining Centrality
  • Relations with China (and Asia) A Historic and Challenging Opportunity
  • Looking Ahead
  • Notes
  • Appendix
Page 12: Implications of the Global and Regional Changes for Argentina's Foreign Relations

Journal of Iberian and Latin American Research 261

Argentina will construct a prototype of that helicopter by 201336 In general the level of

bilateral military dialogue is highly positive37

In key scientific and technological areas there has been an on-going improvement of

relations For example a Satellite Laser Raging (SLR) system designed and made in China

was installed in the Observatory of San Juan University38 Both countries plan to conduct

collaborative activities for Antarctic expedition39 There are many contacts and joint

initiatives in the areas of telecommunications and space40 The two countries are also

interested in creating a Bilateral Centre on Science and Technology for Food41

In addition China will install a satellite station in the province of Neuquen42 while

incrementing its presence in the telecommunications sector and establishing cooperation

ties in the nuclear field43

Argentina and China share important interests in their diplomatic agenda with regards

to the defence of the principle of lsquoterritorial integrityrsquo China consistently supports the

Argentine claim of sovereignty over the MalvinasFalklands while Argentina defends the

policy of lsquoone Chinarsquo which implies the non-recognition of the independence of Taiwan

and Tibet The issue of the MalvinasFalklands Islands has been surfacing for two reasons

On the one hand as Lyle Goldstein has remarked lsquoChinese defence analysts take such

intense interest in the Falkland Warrsquo due to the fact that according to Chinese government

officials and experts there are certain similarities between the Malvinas and Taiwan44 As

Taiwan is a vital issue for Beijing the understanding of the 1982 war in the South Atlantic

is extremely relevant On the other hand the potential closeness of China and Argentina

may provoke in the future a vulnerable situation with regards to the islands that could

affect British defence policy45 In times of a major economic crisis in Europe and with

diminishing possibilities of sustaining high defence budgets retired military officers from

Great Britain overemphasize Londonrsquos potential weakness in the South Atlantic

With respect to issues on the global agenda the two countries agree at the level of the

G-20 on the need for greater participation of emerging nations in international financial

organizations as well as the need to implement measures for the avoidance of financial

speculation that causes volatility in the prices of commodities Both countries have been

supporting peacekeeping operations and they both participate militarily in the UN Mission

in Haiti At the International Atomic Energy Agency Beijing and Buenos Aires have been

active in the promotion of non-proliferation

It is important also to mention a relatively new phenomenon in the relation between

Beijing and Buenos Aires namely Chinese immigration to Argentina There are

approximately 120000 Chinese and Chinese-descendants in Argentina mainly in Buenos

Aires46 Their point of origin is mostly Taiwan and Fujian and to a lesser extent Hong

Kong Even though there are no good estimates or different in-depth studies lsquoChinese

immigration to Argentina is assumed to be largely of illegal naturersquo with lsquoremittances an

important flow of capitalrsquo and Argentina being lsquoan intermediate stoprsquo for approximately

half of the Chinese migrants before seeking entry into the United States (mainly) or the

European Union47

To sum up the capabilities willingness and needs of both sides make the relationship

between Argentina and China (and Asia) complementary The East needs raw materials

(energy food and mining) and Argentina needs investments and infrastructure Of course

a link of this nature presents opportunities but also brings risks It has become fashionable

in Argentina to compare the current situation with the golden years of the lsquospecial

relationshiprsquo with Great Britain (and Europe) that was undoubtedly the engine of the great

Argentine take off between 1880 and 1914 It is also noted that the new relationship with

Asia offers great benefits to the neighbouring countries and therefore does not threaten the

Dow

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2014

262 R Russell and J G Tokatlian

harmony existing in the sub-region48 While recognizing the historic opportunity offered

to Argentina by the (re)emergence of China and the advancement of several Asian nations

others emphasize the risks especially those coming from China

Within that context it is relevant to mention that the highly optimistic somehow-naive

phase of Chinese ndash Latin American relations is experiencing changes including in

Argentina ndash China relations Most countries in the region and among them Argentina are

slowly moving from a strategy of lsquoreliable engagementrsquo49 to a more mixed strategy based

on a prudent approach that combines strong commercial ties and active damage-control

policies50 Latin American countries are well aware of the importance of key economic

issues and the sensitive security questions that characterize the regionrsquos relations with

China Concerns about de-industrialization via commodity-based export growth (affecting

basically South America) the effect of global lsquocurrency warsrsquo on the region (affecting all

of Latin America) and the impact of a decisive push for rural production within China

(affecting mainly Mexico and Central America) are extremely critical issues from North to

South America

On a broader outlook the fact that the global system is witnessing a period of

uncertainty is generating a new examination of Chinarsquos lsquowin-winrsquo diplomacy51 This is a

time of difficulties that places limits on Beijingrsquos global and regional strategies Not

surprisingly Argentina as well as other countries in Latin America is rethinking its ties

with China under a more nuanced viewpoint The advantages and dividends of more

commercial and financial links with China are superseded by new productive challenges

(for example excessive emphasis on commodities for export) at home and sensible

differences abroad (for example in the case of human rights) Interests and values are now

inextricably intertwined in Argentine ndash Chinese diplomacy In this context the deployment

of a more sophisticated policy vis-a-vis Beijing seems inevitable Necessity more than

willingness is pressing Buenos Aires to design a broader Asian strategy where China will

be a centrepiece but not the only counterpart politically and materially for the country

Looking Ahead

Argentinarsquos foreign policy developed historically from 1880 until the early twenty-first

century around three areas Europe the United States and Latin America especially the

Southern Cone countries Relations with the socialist world particularly with the Soviet

Union for political and commercial reasons were also important in the second half of the

twentieth century but never reached the scale of the other three axes In the decade since

2000 a fourth axis has been added to this traditional pattern with extraordinary strength

and projection the Asia Pacific region dominated by China

Relations with Europe remain important since there are shared interests and values and

a long history of mutual interaction In addition Argentina continues to need European

investments and technology transfers and the EU is still an important trading partner (See

Table 3) But Europe like Japan and the United States is a market in which exports have

shown in the last decade ceilings that are difficult to overcome The most dynamic and

consolidated markets for Argentina are in Latin America and Asia There are also other

developing markets that are growing at a faster pace than the rest of the world and offer

new opportunities for Argentine exports (Australia Canada Russia South Africa and

Turkey) In the next years Europe will focus its attention on domestic issues and other

areas of the world It is unlikely that any significant progress in the relations with

Argentina and Mercosur could be made in the short run A longer-term view suggests that

Dow

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ber

2014

Journal of Iberian and Latin American Research 263

Europe will increasingly lose its relative importance for Argentina and that its historically

privileged position in the countryrsquos foreign relations will be a thing of the past

Argentinarsquos relations with the United States have never been easy Joseph Tulchin

summarizes its nature in the title of his well-known book Argentina and the United States A Conflicted Relationship52 The strategy of lsquocouplingrsquo implemented during the Menem

years was a pragmatic adaptation to the world of the immediate post-Cold War and was

buried as a strategic option for Argentina with the 2001 crisis In the decade of 2000 the

Kirchners went back to the traditional historical pattern that we have called lsquolimited

oppositionrsquo53 This pattern which combines collaboration and disagreement deference

and resistance will continue to guide Argentinarsquos foreign policy toward Washington but

in a framework in which Buenos Airesrsquos concerns about restraining the United States

preponderance and power will tend to decrease Present conditions offer a great lsquoobjectiversquo

opportunity for the development of new areas of selective collaboration between the two

countries at the bilateral and regional levels A new era of relations with the United States

seems to be beginning for the Southern Cone one that is less unequal and perhaps more

cooperative The key challenge for Argentina is coping with a new reality of diminishing

influence of Washington in the sub-region Most of the time power erosion produces two

alternative behaviours adaptation or denial At least for the time being the relative decline

of US hegemony in South America is showing signs of a lsquosoft landingrsquo If this scenario

prevails then Argentina may manage its bilateral relation with the United States in a more

constructive way

In the case of Brazil it seems that we are entering a second long cycle of convergent

views about the place of this country in Argentinarsquos foreign policy54 This cycle may be

compared and opposed to another long period of convergent visions that characterized the

dominant form in which the neighbour country was perceived by the Argentine elites

during most of the twentieth century Today Brazil is defined as a strategic partner while

in the past until the return of both countries to democracy it was seen as a rival As we

have already mentioned the main challenge for Argentina is how to build this strategic

partnership within a framework of growing asymmetry

The link with Argentina although very important does not have today the same value

for Brazil as in the second half of the eighties By contrast the relationship with Brazil is

increasingly relevant for Argentinarsquos foreign relations and one that presents a significant

challenge In the past the relative symmetry between both countries was a constant source

of suspicion and conflict In the future the condition of asymmetric interdependence as a

structural feature of the relationship will not allow for competition but also is no

guarantee of friendship or cooperation Rather it can become a new source of suspicion

distrust and differences Argentina and Brazil will have to learn to live together in this new

reality and develop a broader framework of mutual understanding to manage the major

density of bilateral links and the global issues of common interests The greatest effort

must come from Argentina because it is the country that has a higher interest in the

relationship and more to gain

Finally the emergence of Asia is offering Argentina a unique opportunity for a

dynamic and successful international integration Its most recent economic dynamism is a

direct result of the increased demand from China and other Asian countries for food and

raw materials However Argentinarsquos exports to Asia are highly concentrated in the

soybean complex and to a much smaller extent in a small group of primary and natural

resource intensive products According to the latest ECLAC report five major products

accounted for 92 of total exports from Argentina to China during the years 2007 ndash 2009

(soybean 531 soybean oil 265 crude oil 747 other cattle 248 and meat and

Dow

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ovem

ber

2014

264 R Russell and J G Tokatlian

poultry offal 233)55 Moreover the trade surplus with China has tended to evaporate

after several years of significant positive balances

This situation raises many questions about the Argentine specialization pattern ndash

beyond issues related to trade with China ndash and the need to reduce an excessive

dependence on the export of commodities Nevertheless as the benefits of trade with

China have been so high and have also enabled Argentina to successfully face and resist

the financial crises in the centres the propensity to do nothing is great As Eric Farnsworth

recently observed lsquoWhen nations are able to sell as much as they can produce of any

particular product the thinking is generally to continue doing so and reap the rewards

When economies are growing there is little political imperative or incentive for reformrsquo56

In consequence a relevant question surrounding this type of relationship is how to avoid

the temptation to inertia The tendency towards passive repetition is appealing The China

lsquochallengersquo in the early twenty-first century for Argentina is how to think and act

differently from what had been the case of Argentine ndash British relations at the beginning of

the twentieth century The framing of a different link with Beijing as well as the positive

handling of an increasingly complex multifaceted multilevel relationship with Brazil

seem to be the major challenges ahead for Argentinarsquos foreign relations

Notes 1 Roberto Russell and Juan G Tokatlian El lugar de Brasil en la polıtica exterior argentina

Buenos Aires Fondo de Cultura Econo mica 2003 pp 45 ndash 59 2 We use the concept lsquosystemic changesrsquo in the same sense as Robert Gilpin See his book War

and Change in World Politics Cambridge Cambridge University Press 1981 pp 42ndash 43 3 For an interesting analysis of these debates see Jose Paradiso Debates y trayectoria de la

polıtica exterior argentina Buenos Aires Grupo Editor Latinoamericano 1993 4 On the concept lsquoasymmetryrsquo and its implications for bilateral relations see Brantley Womack

lsquoAsymmetry and Systemic Misperception China Vietnam and Cambodia during the 1970rsquosrsquo Journal of Strategic Studies 262 June 2003 pp 92ndash 119

5 On structural and relational power see Susan Strange States and Markets An Introduction to International Political Economy London Pinter 1988 pp 25ndash9

6 David C Kang lsquoThe theoretical roots of hierarchy in international relationsrsquo Australian Journal of International Affairs 583 September 2004 p 339

7 Roberto Russell and Juan G Tokatlian lsquoBeyond Orthodoxy Asserting Latin Americarsquos New Strategic Options Toward the United Statesrsquo Latin America Politics and Society 533 Winter 2011 pp 129 ndash 134

8 Eric Hobsbawm lsquoDespues del siglo XX un mundo en transicionrsquo in Ricardo Lagos (ed) America Latina iquestintegracion o fragmentacion Buenos Aires Edhasa 2008 pp 29ndash 47

9 Remarks by the President of the Argentine Republic Nestor Kirchner at the inauguration of the IV Summit of the Americas Mar del Plata httpwwwsummit-ameicasorgDocuments 20del20presidente20de20RepC3BAblica20Argentinapdf

10 La Nacion (Buenos Aires) lsquoCristina Kirchner critico a Obama con duros terminosrsquo 26 February 2010 Available at httpwwwlanacioncomar1237368-cristina-kirchner-criticoshya-obama-con-duros-terminos accessed 17 November 2011

11 For more in depth analysis of the bilateral relations see Russell and Tokatlian El lugar de Brasil pp 45ndash59 and Roberto Russell and Juan G Tokatlian lsquoPercepcoes argentinas sobre o Brasil ambivalencias e expectativasrsquo Polıtica Externa 202 September 2011 pp 43ndash 56

12 Monica Hirst lsquoLa polıtica sudamericana de Brasil entre el peso de las asimetrıas y la incidencia de nuevas coyunturasrsquo in F Calderon (ed) Escenarios polıticos en America Latina Conceptos metodos y Observatorio Regional Cuadernos de Gobernabilidad Democratica 2 Buenos Aires PNUD Siglo XXI 2008 p 257

13 We use the concept of friendship following Alexander Wendt Social Theory of International Politics Cambridge Cambridge UP 1999 pp 297ndash 308

14 La Nacion Economıa y Negocios Buenos Aires lsquoBrasil en la vida cotidiana argentinarsquo 22 May 2011 p 1

Dow

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02

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ber

2014

Journal of Iberian and Latin American Research 265

15 On China ndash Latin America relations at the beginning of the XXI Century see Juan G Tokatlian lsquoA view from Latin Americarsquo in R Roett and G Paz (eds) Chinarsquos Expansion into the Western Hemisphere Implications for Latin America and the United States Washington DC Brookings Institution Press 2008

16 According toMark P Sullivan a specialist on Latin American affairs at theUS Congressional Research Service lsquoThe balance of opinion toward China and the United States in Latin America tend to be roughly comparable according to a (2007) Pew study Two exceptions are Argentina where China is viewed much more favorably than the United States and in Mexico where the United States is viewed much more favorably than Chinarsquo See Thomas Lum (ed) lsquoComparing Global Influence China and US Diplomacy Foreign Aid Trade and Investment in the Developing Worldrsquo in CRS Report to Congress August 15 2008

17 Kevin Gallagher lsquoLatin Americarsquos China challengersquo 2011 Policy Innovations httpwwwase tuftsedugdaePubsrpGallagher_PolicyInnovationsJan11pdf accessed 18 November 2011

18 Pablo Gerchunoff 2010 lsquoCausas y azares en mas de un siglo de historia econo mica argentinarsquo in R Russell (ed) Argentina 1910ndash2010 Balance de un siglo Buenos Aires Taurus p 152

19 See the complete quote in Sergio Cesarin lsquoChina y Argentina Enfoques y recomendaciones para potenciar la relacion bilateralrsquo Serie Aportes 2010 httplibraryfesdepdf-filesbueros argentinien07560pdf accessed 28 November 2011

20 Based on INDEC 2011 and Comercio Exterior Argentino 2010 httpwwwindecgovar accessed 13 November 2011

21 Camara de Exportadores de la Republica Argentina En Contcto China No 43 November 2011 p 16

22 In October 2009 President Cristina Fernandez de Kirchner visited India It was her first trip to an Asian country after her inauguration in December 2007 and it was the first visit of an Argentine president to India since 1994

23 It is important to mention the cases of Indonesia and Vietnam for two reasons the growth of trade in the last decade and the fact Argentine exports to these two countries are mainly nonshytraditional commodities For example exports to Indonesia jumped fromUS$43million in 2001 to US$852 million in 2010 while exports to Vietnam grew from US$60 million in 2001 to US $654 million in 2010 Cların iEco Buenos Aires lsquoArgentina en mas puertosrsquo 28 August 2011

24 La Nacion Economıa y Negocios Buenos Aires lsquoLa soja argentina ahora apunta a la Indiarsquo 15 September 2011 p 3

25 China Daily lsquoArgentina China sign tentative swap dealrsquo 31 March 2009 httpwww chinadailycomcnchina2009-0331content_7635007htm accessed 11 November 2011

26 Argenpress (Buenos Aires) lsquoInversiones chinas en la Argentina Claves del nuevo escenario energeticorsquo 14 June 2011 httpwwwargenpressinfo201106inversiones-chinas-enshyargentina-claveshtml accessed 19 November 2011

27 See text of the agreement at httpwwwgrrorgarrionegro-chinaacuerdo-saiz-chinapdf accessed 26 Nov 2011 and El Cronista Buenos Aires lsquoChina invierte 1500 millones en Rıo Negro para asegurarse alimentosrsquo 9 June 2011 httpwwwcronistacomnegocios China-invierte-us-1500-millones-en-Rio-Negro-para-asegurarse-alimentos-20110609-0033 html accessed 19 November 2011

28 On other actual and potential Chinese investments in Argentine provinces see Camara Argentino China Negocios con China 2011 httpwwwargenchinaorgarticulos_2010 NegociosConChinapdf accessed 14 November 2011 and FUNDAMIN lsquoChina invierte en las 23 provincias argentinasrsquo httpfundamincomaresinfo36-exportaciones-e-importaciones 299-china-invierte-en-las-23-provincias-argentinashtml accessed 19 November 2011

29 httpwwwnoalaminaorgmineria-informacion-generalgeneralargentina-china-recreacionshyde-la-vieja-qrelacion-especialq-con-gran-bretana accessed 20 January 2012

30 lsquoLas relaciones entre China y Argentinarsquo httpespanolcricn1161201211281s264119 htm accessed 17 November 2011

31 lsquoRailway rapprochement China invests in Argentinarsquo 2010 httpwwwas-coaorgarticles 2528Railway_Rapprochement_China_Invests_in_Argentina accessed 17 Nov 2011

32 Silvia Simonit lsquoLas empresas chinas en Argentinarsquo Chinese Studies Working Paper Series (Universitat Pompeu Fabra) No 1 2011

33 Loro Horta lsquoIn Uncle Samrsquos Backyard Chinarsquos Military Influence in Latin Americarsquo Military Review September-October 2008 p 48

Dow

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ovem

ber

2014

266 R Russell and J G Tokatlian

34 As are the cases of Brazil Chile Colombia and Venezuela 35 Seguridad y Defensa lsquoEl Ejercito Negocia con China la compra de helico pterosrsquo 10 October

2010 httpwwwseguridadydefensacomarnoticiasejercito-negocia-con-china-la-comprashyde-helicopteros-25059html accessed 10 November 2011

36 httpwwwelmetroonlinecomarindexphpoption frac14com_k2ampviewfrac14 itemampidfrac141067 purishycelli-firmC3B3-convenio-de-defensa-con-chinaampItemid frac14238 accessed 12 September 2012

37 China Military Online lsquoChang Wanquan holds talks with Argentine deputy Defense ministerrsquo 28 November 2011 httpengchinamilcomcnnews-channelschina-militaryshynews2011-1128content_4725893htm accessed 29 November 2011

38 T Wang et lsquoNew SRL station running in San Juan of Argentinarsquo Crustal Dynamics Data Information System nd httpcddisgsfcnasagovlw15docspapersNew20SLR20Station 20Running20in20San20Juan20of20Argentinapdf accessed 9 November 2011

39 Chinese Academy of Sciences lsquoChina Argentina to strengthen cooperation on Antarctic expeditionrsquo 16 August 2010 httpenglishbiccascnNE201008t20100816_57510html accessed 29 November 2011

40 Janie Hulse lsquoChinarsquos Expansion into and US withdrawal from Argentinarsquos telecommunicashytions and space industries and the implications for US national securityrsquo Strategic Studies Institute September 2007 httpwwwstrategicstudiesinstitutearmymilpdffilespub806pdf accessed 7 November 2011

41 Ministry of Science and Technology lsquoChina y la Argentina se reu nen para desarrollar un Centro Binacionalrsquo 2011 httpwwwmincytgovaragendaagenda_detalle phpid_ agendafrac1435 accessed 16 November 2011

42 httpwwwlmneuquencomarnoticias201282avanza-instalacion-de-una-estacion-satel ital-de-china-en-la-provincia_156999 accessed 14 October 2012

43 httpwwwstrategicstudiesinstitutearmymilpubssummarycfmqfrac14 806 accessed 29 November 2011 httpenergyseenewscomnewsargentina-china-sign-nuclear-coop eration-agreement-306141 accessed 3 November 2012

44 For the major reasons that motivated this interest see Lyle Goldstein lsquoChinarsquos Falklands Lessonsrsquo Survival 503 2008 pp 65-66

45 UKNDA Inconvenient Truths Threats Justify Prioritising Defence London UKNDA 2011 p 24

46 La Nacion Buenos Aires lsquoVivir en la Argentina estudiar en Chinarsquo 11 October 2011 http wwwlanacioncomar1413556-vivir-en-la-argentina-estudiar-en-china accessed 9 Novemshyber 2011

47 G M Calderon lsquoInmigracion china en las Americas Comparacion de las experiencias en Canada y Argentinarsquo Revista Argentina de Estudios Canadienses No 2 2008 p 30

48 La Nacion Buenos Aires lsquoChina Una oportunidad histo ricarsquo 26 July 2011 49 Juan Tokatlian lsquoLatin America China and the United States A Hopeful Trianglersquo 2007

Open Democracy httpwwwopendemocracynetdemocracy-protesthopeful_triangle_ 4336jsp accessed 4 November 2011

50 La Nacion Buenos Aires lsquoUna nueva estrategia hacia Chinarsquo 29 August 2011 51 Brantley Womack lsquoBeyond Win-Win Rethinking International Relationships in an Era of

Economic Uncertaintyrsquo Paper presented to the International Conference on the Chinese Models of Development Domestic and Global Aspects Taipei Taiwan September 2011

52 Joseph Tulchin Argentina and the United States A Conflicted Relationship New York Macmillan 1990

53 Russell and Tokatlian lsquoBeyond Orthodoxyrsquo 54 According to the latest report of Latinobaro metro 52 of the Argentines consider Brazil as

the main leader of Latin America while only 2 gives that condition to the United States http wwwlatinobarometroorglatinoLATContenidosjsp accessed 23 November 2011

55 Osvaldo Rosales lsquoLa Republica Popular China y America Latina y el Caribe Hacia una nueva fase en el vınculo econo mico comercialrsquo 2011 ECLAC httpwwweclacorgpubl icacionesxml643666La_Republica_Popular _China_y_America_Latina_y_el_Caribe _ tradepdf accessed 10 November 2011

56 Eric Farnsworth 2011 lsquoThe New Mercantilism Chinarsquos Emerging Role in the Americasrsquo Current History February Available at httpwwwas coaorgarticles2982The_New_shyMercantilism_Chinas_Emerging_Role_in_the_Americas accessed 28 November 2011

Dow

nloa

ded

by [

FU B

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02

37 0

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ovem

ber

2014

Journal of Iberian and Latin American Research 267

Appendix 1

Table 1

Argentinean trade with Brazil in millions of dollars 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Exports 6206 4828 4666 5587 6335 8141 10498 13272 11374 14420 Imports 5230 2517 4700 7567 10187 11749 14523 17687 11822 17658 Trade 975 2310 233 21980 23852 23608 24025 24415 2448 23238 balance

Argentinean trade with the United States in millions of dollars 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Exports 2840 2869 3364 3733 4493 4025 4153 5095 3465 3656 Imports 3737 1789 2238 3389 3998 4247 5264 6894 5106 6125 Trade 2897 1080 1126 344 495 2222 21111 21799 21641 22469 balance

Argentinean trade with China in millions of dollars 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Exports 1123 1092 2483 2628 3193 3476 5170 6355 3668 6117 Imports 1066 330 721 1402 2237 3122 5093 7104 4823 7678 Trade 56 762 1762 1227 956 354 77 2 749 2 1155 2 1561 balance

Source INDEC and UNCTAD

Table 2

FDI stock in Argentina by country of origin in millions of dollars (selected countries) 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

USA 16422 7476 7989 10277 11689 12208 13601 13930 14012 14814 of total 238 231 208 182 187 176 175 172 175 168

Brazil 1953 2108 3280 1773 2488 2810 3659 4969 4319 5367 of total 283 651 856 314 397 406 470 614 539 608

China no data no data no data 13 11 45 120 141 123 5500 of total no data no data no data 002 002 006 015 017 015 623

Total 68935 32403 38323 56554 62639 69292 77899 80941 80144 88249

for the years 2001 2002 and 2003 the data for Brazil includes all FDI from South America excluding ChileFrom 2003 onwards the data is exclusively for BrazilSource INDEC and UNCTAD

Table 3

Argentinean trade with the European Union in millions of dollars 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Exports 4698 5309 6079 6209 6844 8010 9901 13173 10278 11026 Imports 4717 2107 2814 4237 4830 5811 7442 9043 6434 7587 Trade 219 3201 3265 1972 2013 2199 2458 4130 3845 3439 balance

FDI from the European Union in Argentina in millions of dollars 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

FDI 38279 18284 21273 33001 36848 40408 45159 45070 44963 47605 of total 5553 5643 5551 5835 5883 5832 5797 5568 5610 5394 Total 68935 32403 38323 56554 62639 69292 77899 80941 80144 88249

Source INDEC and UNCTAD

Dow

nloa

ded

by [

FU B

erlin

] at

02

37 0

5 N

ovem

ber

2014

  • Abstract
  • The United States and Brazil Losing and Gaining Centrality
  • Relations with China (and Asia) A Historic and Challenging Opportunity
  • Looking Ahead
  • Notes
  • Appendix
Page 13: Implications of the Global and Regional Changes for Argentina's Foreign Relations

262 R Russell and J G Tokatlian

harmony existing in the sub-region48 While recognizing the historic opportunity offered

to Argentina by the (re)emergence of China and the advancement of several Asian nations

others emphasize the risks especially those coming from China

Within that context it is relevant to mention that the highly optimistic somehow-naive

phase of Chinese ndash Latin American relations is experiencing changes including in

Argentina ndash China relations Most countries in the region and among them Argentina are

slowly moving from a strategy of lsquoreliable engagementrsquo49 to a more mixed strategy based

on a prudent approach that combines strong commercial ties and active damage-control

policies50 Latin American countries are well aware of the importance of key economic

issues and the sensitive security questions that characterize the regionrsquos relations with

China Concerns about de-industrialization via commodity-based export growth (affecting

basically South America) the effect of global lsquocurrency warsrsquo on the region (affecting all

of Latin America) and the impact of a decisive push for rural production within China

(affecting mainly Mexico and Central America) are extremely critical issues from North to

South America

On a broader outlook the fact that the global system is witnessing a period of

uncertainty is generating a new examination of Chinarsquos lsquowin-winrsquo diplomacy51 This is a

time of difficulties that places limits on Beijingrsquos global and regional strategies Not

surprisingly Argentina as well as other countries in Latin America is rethinking its ties

with China under a more nuanced viewpoint The advantages and dividends of more

commercial and financial links with China are superseded by new productive challenges

(for example excessive emphasis on commodities for export) at home and sensible

differences abroad (for example in the case of human rights) Interests and values are now

inextricably intertwined in Argentine ndash Chinese diplomacy In this context the deployment

of a more sophisticated policy vis-a-vis Beijing seems inevitable Necessity more than

willingness is pressing Buenos Aires to design a broader Asian strategy where China will

be a centrepiece but not the only counterpart politically and materially for the country

Looking Ahead

Argentinarsquos foreign policy developed historically from 1880 until the early twenty-first

century around three areas Europe the United States and Latin America especially the

Southern Cone countries Relations with the socialist world particularly with the Soviet

Union for political and commercial reasons were also important in the second half of the

twentieth century but never reached the scale of the other three axes In the decade since

2000 a fourth axis has been added to this traditional pattern with extraordinary strength

and projection the Asia Pacific region dominated by China

Relations with Europe remain important since there are shared interests and values and

a long history of mutual interaction In addition Argentina continues to need European

investments and technology transfers and the EU is still an important trading partner (See

Table 3) But Europe like Japan and the United States is a market in which exports have

shown in the last decade ceilings that are difficult to overcome The most dynamic and

consolidated markets for Argentina are in Latin America and Asia There are also other

developing markets that are growing at a faster pace than the rest of the world and offer

new opportunities for Argentine exports (Australia Canada Russia South Africa and

Turkey) In the next years Europe will focus its attention on domestic issues and other

areas of the world It is unlikely that any significant progress in the relations with

Argentina and Mercosur could be made in the short run A longer-term view suggests that

Dow

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ber

2014

Journal of Iberian and Latin American Research 263

Europe will increasingly lose its relative importance for Argentina and that its historically

privileged position in the countryrsquos foreign relations will be a thing of the past

Argentinarsquos relations with the United States have never been easy Joseph Tulchin

summarizes its nature in the title of his well-known book Argentina and the United States A Conflicted Relationship52 The strategy of lsquocouplingrsquo implemented during the Menem

years was a pragmatic adaptation to the world of the immediate post-Cold War and was

buried as a strategic option for Argentina with the 2001 crisis In the decade of 2000 the

Kirchners went back to the traditional historical pattern that we have called lsquolimited

oppositionrsquo53 This pattern which combines collaboration and disagreement deference

and resistance will continue to guide Argentinarsquos foreign policy toward Washington but

in a framework in which Buenos Airesrsquos concerns about restraining the United States

preponderance and power will tend to decrease Present conditions offer a great lsquoobjectiversquo

opportunity for the development of new areas of selective collaboration between the two

countries at the bilateral and regional levels A new era of relations with the United States

seems to be beginning for the Southern Cone one that is less unequal and perhaps more

cooperative The key challenge for Argentina is coping with a new reality of diminishing

influence of Washington in the sub-region Most of the time power erosion produces two

alternative behaviours adaptation or denial At least for the time being the relative decline

of US hegemony in South America is showing signs of a lsquosoft landingrsquo If this scenario

prevails then Argentina may manage its bilateral relation with the United States in a more

constructive way

In the case of Brazil it seems that we are entering a second long cycle of convergent

views about the place of this country in Argentinarsquos foreign policy54 This cycle may be

compared and opposed to another long period of convergent visions that characterized the

dominant form in which the neighbour country was perceived by the Argentine elites

during most of the twentieth century Today Brazil is defined as a strategic partner while

in the past until the return of both countries to democracy it was seen as a rival As we

have already mentioned the main challenge for Argentina is how to build this strategic

partnership within a framework of growing asymmetry

The link with Argentina although very important does not have today the same value

for Brazil as in the second half of the eighties By contrast the relationship with Brazil is

increasingly relevant for Argentinarsquos foreign relations and one that presents a significant

challenge In the past the relative symmetry between both countries was a constant source

of suspicion and conflict In the future the condition of asymmetric interdependence as a

structural feature of the relationship will not allow for competition but also is no

guarantee of friendship or cooperation Rather it can become a new source of suspicion

distrust and differences Argentina and Brazil will have to learn to live together in this new

reality and develop a broader framework of mutual understanding to manage the major

density of bilateral links and the global issues of common interests The greatest effort

must come from Argentina because it is the country that has a higher interest in the

relationship and more to gain

Finally the emergence of Asia is offering Argentina a unique opportunity for a

dynamic and successful international integration Its most recent economic dynamism is a

direct result of the increased demand from China and other Asian countries for food and

raw materials However Argentinarsquos exports to Asia are highly concentrated in the

soybean complex and to a much smaller extent in a small group of primary and natural

resource intensive products According to the latest ECLAC report five major products

accounted for 92 of total exports from Argentina to China during the years 2007 ndash 2009

(soybean 531 soybean oil 265 crude oil 747 other cattle 248 and meat and

Dow

nloa

ded

by [

FU B

erlin

] at

02

37 0

5 N

ovem

ber

2014

264 R Russell and J G Tokatlian

poultry offal 233)55 Moreover the trade surplus with China has tended to evaporate

after several years of significant positive balances

This situation raises many questions about the Argentine specialization pattern ndash

beyond issues related to trade with China ndash and the need to reduce an excessive

dependence on the export of commodities Nevertheless as the benefits of trade with

China have been so high and have also enabled Argentina to successfully face and resist

the financial crises in the centres the propensity to do nothing is great As Eric Farnsworth

recently observed lsquoWhen nations are able to sell as much as they can produce of any

particular product the thinking is generally to continue doing so and reap the rewards

When economies are growing there is little political imperative or incentive for reformrsquo56

In consequence a relevant question surrounding this type of relationship is how to avoid

the temptation to inertia The tendency towards passive repetition is appealing The China

lsquochallengersquo in the early twenty-first century for Argentina is how to think and act

differently from what had been the case of Argentine ndash British relations at the beginning of

the twentieth century The framing of a different link with Beijing as well as the positive

handling of an increasingly complex multifaceted multilevel relationship with Brazil

seem to be the major challenges ahead for Argentinarsquos foreign relations

Notes 1 Roberto Russell and Juan G Tokatlian El lugar de Brasil en la polıtica exterior argentina

Buenos Aires Fondo de Cultura Econo mica 2003 pp 45 ndash 59 2 We use the concept lsquosystemic changesrsquo in the same sense as Robert Gilpin See his book War

and Change in World Politics Cambridge Cambridge University Press 1981 pp 42ndash 43 3 For an interesting analysis of these debates see Jose Paradiso Debates y trayectoria de la

polıtica exterior argentina Buenos Aires Grupo Editor Latinoamericano 1993 4 On the concept lsquoasymmetryrsquo and its implications for bilateral relations see Brantley Womack

lsquoAsymmetry and Systemic Misperception China Vietnam and Cambodia during the 1970rsquosrsquo Journal of Strategic Studies 262 June 2003 pp 92ndash 119

5 On structural and relational power see Susan Strange States and Markets An Introduction to International Political Economy London Pinter 1988 pp 25ndash9

6 David C Kang lsquoThe theoretical roots of hierarchy in international relationsrsquo Australian Journal of International Affairs 583 September 2004 p 339

7 Roberto Russell and Juan G Tokatlian lsquoBeyond Orthodoxy Asserting Latin Americarsquos New Strategic Options Toward the United Statesrsquo Latin America Politics and Society 533 Winter 2011 pp 129 ndash 134

8 Eric Hobsbawm lsquoDespues del siglo XX un mundo en transicionrsquo in Ricardo Lagos (ed) America Latina iquestintegracion o fragmentacion Buenos Aires Edhasa 2008 pp 29ndash 47

9 Remarks by the President of the Argentine Republic Nestor Kirchner at the inauguration of the IV Summit of the Americas Mar del Plata httpwwwsummit-ameicasorgDocuments 20del20presidente20de20RepC3BAblica20Argentinapdf

10 La Nacion (Buenos Aires) lsquoCristina Kirchner critico a Obama con duros terminosrsquo 26 February 2010 Available at httpwwwlanacioncomar1237368-cristina-kirchner-criticoshya-obama-con-duros-terminos accessed 17 November 2011

11 For more in depth analysis of the bilateral relations see Russell and Tokatlian El lugar de Brasil pp 45ndash59 and Roberto Russell and Juan G Tokatlian lsquoPercepcoes argentinas sobre o Brasil ambivalencias e expectativasrsquo Polıtica Externa 202 September 2011 pp 43ndash 56

12 Monica Hirst lsquoLa polıtica sudamericana de Brasil entre el peso de las asimetrıas y la incidencia de nuevas coyunturasrsquo in F Calderon (ed) Escenarios polıticos en America Latina Conceptos metodos y Observatorio Regional Cuadernos de Gobernabilidad Democratica 2 Buenos Aires PNUD Siglo XXI 2008 p 257

13 We use the concept of friendship following Alexander Wendt Social Theory of International Politics Cambridge Cambridge UP 1999 pp 297ndash 308

14 La Nacion Economıa y Negocios Buenos Aires lsquoBrasil en la vida cotidiana argentinarsquo 22 May 2011 p 1

Dow

nloa

ded

by [

FU B

erlin

] at

02

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ovem

ber

2014

Journal of Iberian and Latin American Research 265

15 On China ndash Latin America relations at the beginning of the XXI Century see Juan G Tokatlian lsquoA view from Latin Americarsquo in R Roett and G Paz (eds) Chinarsquos Expansion into the Western Hemisphere Implications for Latin America and the United States Washington DC Brookings Institution Press 2008

16 According toMark P Sullivan a specialist on Latin American affairs at theUS Congressional Research Service lsquoThe balance of opinion toward China and the United States in Latin America tend to be roughly comparable according to a (2007) Pew study Two exceptions are Argentina where China is viewed much more favorably than the United States and in Mexico where the United States is viewed much more favorably than Chinarsquo See Thomas Lum (ed) lsquoComparing Global Influence China and US Diplomacy Foreign Aid Trade and Investment in the Developing Worldrsquo in CRS Report to Congress August 15 2008

17 Kevin Gallagher lsquoLatin Americarsquos China challengersquo 2011 Policy Innovations httpwwwase tuftsedugdaePubsrpGallagher_PolicyInnovationsJan11pdf accessed 18 November 2011

18 Pablo Gerchunoff 2010 lsquoCausas y azares en mas de un siglo de historia econo mica argentinarsquo in R Russell (ed) Argentina 1910ndash2010 Balance de un siglo Buenos Aires Taurus p 152

19 See the complete quote in Sergio Cesarin lsquoChina y Argentina Enfoques y recomendaciones para potenciar la relacion bilateralrsquo Serie Aportes 2010 httplibraryfesdepdf-filesbueros argentinien07560pdf accessed 28 November 2011

20 Based on INDEC 2011 and Comercio Exterior Argentino 2010 httpwwwindecgovar accessed 13 November 2011

21 Camara de Exportadores de la Republica Argentina En Contcto China No 43 November 2011 p 16

22 In October 2009 President Cristina Fernandez de Kirchner visited India It was her first trip to an Asian country after her inauguration in December 2007 and it was the first visit of an Argentine president to India since 1994

23 It is important to mention the cases of Indonesia and Vietnam for two reasons the growth of trade in the last decade and the fact Argentine exports to these two countries are mainly nonshytraditional commodities For example exports to Indonesia jumped fromUS$43million in 2001 to US$852 million in 2010 while exports to Vietnam grew from US$60 million in 2001 to US $654 million in 2010 Cların iEco Buenos Aires lsquoArgentina en mas puertosrsquo 28 August 2011

24 La Nacion Economıa y Negocios Buenos Aires lsquoLa soja argentina ahora apunta a la Indiarsquo 15 September 2011 p 3

25 China Daily lsquoArgentina China sign tentative swap dealrsquo 31 March 2009 httpwww chinadailycomcnchina2009-0331content_7635007htm accessed 11 November 2011

26 Argenpress (Buenos Aires) lsquoInversiones chinas en la Argentina Claves del nuevo escenario energeticorsquo 14 June 2011 httpwwwargenpressinfo201106inversiones-chinas-enshyargentina-claveshtml accessed 19 November 2011

27 See text of the agreement at httpwwwgrrorgarrionegro-chinaacuerdo-saiz-chinapdf accessed 26 Nov 2011 and El Cronista Buenos Aires lsquoChina invierte 1500 millones en Rıo Negro para asegurarse alimentosrsquo 9 June 2011 httpwwwcronistacomnegocios China-invierte-us-1500-millones-en-Rio-Negro-para-asegurarse-alimentos-20110609-0033 html accessed 19 November 2011

28 On other actual and potential Chinese investments in Argentine provinces see Camara Argentino China Negocios con China 2011 httpwwwargenchinaorgarticulos_2010 NegociosConChinapdf accessed 14 November 2011 and FUNDAMIN lsquoChina invierte en las 23 provincias argentinasrsquo httpfundamincomaresinfo36-exportaciones-e-importaciones 299-china-invierte-en-las-23-provincias-argentinashtml accessed 19 November 2011

29 httpwwwnoalaminaorgmineria-informacion-generalgeneralargentina-china-recreacionshyde-la-vieja-qrelacion-especialq-con-gran-bretana accessed 20 January 2012

30 lsquoLas relaciones entre China y Argentinarsquo httpespanolcricn1161201211281s264119 htm accessed 17 November 2011

31 lsquoRailway rapprochement China invests in Argentinarsquo 2010 httpwwwas-coaorgarticles 2528Railway_Rapprochement_China_Invests_in_Argentina accessed 17 Nov 2011

32 Silvia Simonit lsquoLas empresas chinas en Argentinarsquo Chinese Studies Working Paper Series (Universitat Pompeu Fabra) No 1 2011

33 Loro Horta lsquoIn Uncle Samrsquos Backyard Chinarsquos Military Influence in Latin Americarsquo Military Review September-October 2008 p 48

Dow

nloa

ded

by [

FU B

erlin

] at

02

37 0

5 N

ovem

ber

2014

266 R Russell and J G Tokatlian

34 As are the cases of Brazil Chile Colombia and Venezuela 35 Seguridad y Defensa lsquoEl Ejercito Negocia con China la compra de helico pterosrsquo 10 October

2010 httpwwwseguridadydefensacomarnoticiasejercito-negocia-con-china-la-comprashyde-helicopteros-25059html accessed 10 November 2011

36 httpwwwelmetroonlinecomarindexphpoption frac14com_k2ampviewfrac14 itemampidfrac141067 purishycelli-firmC3B3-convenio-de-defensa-con-chinaampItemid frac14238 accessed 12 September 2012

37 China Military Online lsquoChang Wanquan holds talks with Argentine deputy Defense ministerrsquo 28 November 2011 httpengchinamilcomcnnews-channelschina-militaryshynews2011-1128content_4725893htm accessed 29 November 2011

38 T Wang et lsquoNew SRL station running in San Juan of Argentinarsquo Crustal Dynamics Data Information System nd httpcddisgsfcnasagovlw15docspapersNew20SLR20Station 20Running20in20San20Juan20of20Argentinapdf accessed 9 November 2011

39 Chinese Academy of Sciences lsquoChina Argentina to strengthen cooperation on Antarctic expeditionrsquo 16 August 2010 httpenglishbiccascnNE201008t20100816_57510html accessed 29 November 2011

40 Janie Hulse lsquoChinarsquos Expansion into and US withdrawal from Argentinarsquos telecommunicashytions and space industries and the implications for US national securityrsquo Strategic Studies Institute September 2007 httpwwwstrategicstudiesinstitutearmymilpdffilespub806pdf accessed 7 November 2011

41 Ministry of Science and Technology lsquoChina y la Argentina se reu nen para desarrollar un Centro Binacionalrsquo 2011 httpwwwmincytgovaragendaagenda_detalle phpid_ agendafrac1435 accessed 16 November 2011

42 httpwwwlmneuquencomarnoticias201282avanza-instalacion-de-una-estacion-satel ital-de-china-en-la-provincia_156999 accessed 14 October 2012

43 httpwwwstrategicstudiesinstitutearmymilpubssummarycfmqfrac14 806 accessed 29 November 2011 httpenergyseenewscomnewsargentina-china-sign-nuclear-coop eration-agreement-306141 accessed 3 November 2012

44 For the major reasons that motivated this interest see Lyle Goldstein lsquoChinarsquos Falklands Lessonsrsquo Survival 503 2008 pp 65-66

45 UKNDA Inconvenient Truths Threats Justify Prioritising Defence London UKNDA 2011 p 24

46 La Nacion Buenos Aires lsquoVivir en la Argentina estudiar en Chinarsquo 11 October 2011 http wwwlanacioncomar1413556-vivir-en-la-argentina-estudiar-en-china accessed 9 Novemshyber 2011

47 G M Calderon lsquoInmigracion china en las Americas Comparacion de las experiencias en Canada y Argentinarsquo Revista Argentina de Estudios Canadienses No 2 2008 p 30

48 La Nacion Buenos Aires lsquoChina Una oportunidad histo ricarsquo 26 July 2011 49 Juan Tokatlian lsquoLatin America China and the United States A Hopeful Trianglersquo 2007

Open Democracy httpwwwopendemocracynetdemocracy-protesthopeful_triangle_ 4336jsp accessed 4 November 2011

50 La Nacion Buenos Aires lsquoUna nueva estrategia hacia Chinarsquo 29 August 2011 51 Brantley Womack lsquoBeyond Win-Win Rethinking International Relationships in an Era of

Economic Uncertaintyrsquo Paper presented to the International Conference on the Chinese Models of Development Domestic and Global Aspects Taipei Taiwan September 2011

52 Joseph Tulchin Argentina and the United States A Conflicted Relationship New York Macmillan 1990

53 Russell and Tokatlian lsquoBeyond Orthodoxyrsquo 54 According to the latest report of Latinobaro metro 52 of the Argentines consider Brazil as

the main leader of Latin America while only 2 gives that condition to the United States http wwwlatinobarometroorglatinoLATContenidosjsp accessed 23 November 2011

55 Osvaldo Rosales lsquoLa Republica Popular China y America Latina y el Caribe Hacia una nueva fase en el vınculo econo mico comercialrsquo 2011 ECLAC httpwwweclacorgpubl icacionesxml643666La_Republica_Popular _China_y_America_Latina_y_el_Caribe _ tradepdf accessed 10 November 2011

56 Eric Farnsworth 2011 lsquoThe New Mercantilism Chinarsquos Emerging Role in the Americasrsquo Current History February Available at httpwwwas coaorgarticles2982The_New_shyMercantilism_Chinas_Emerging_Role_in_the_Americas accessed 28 November 2011

Dow

nloa

ded

by [

FU B

erlin

] at

02

37 0

5 N

ovem

ber

2014

Journal of Iberian and Latin American Research 267

Appendix 1

Table 1

Argentinean trade with Brazil in millions of dollars 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Exports 6206 4828 4666 5587 6335 8141 10498 13272 11374 14420 Imports 5230 2517 4700 7567 10187 11749 14523 17687 11822 17658 Trade 975 2310 233 21980 23852 23608 24025 24415 2448 23238 balance

Argentinean trade with the United States in millions of dollars 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Exports 2840 2869 3364 3733 4493 4025 4153 5095 3465 3656 Imports 3737 1789 2238 3389 3998 4247 5264 6894 5106 6125 Trade 2897 1080 1126 344 495 2222 21111 21799 21641 22469 balance

Argentinean trade with China in millions of dollars 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Exports 1123 1092 2483 2628 3193 3476 5170 6355 3668 6117 Imports 1066 330 721 1402 2237 3122 5093 7104 4823 7678 Trade 56 762 1762 1227 956 354 77 2 749 2 1155 2 1561 balance

Source INDEC and UNCTAD

Table 2

FDI stock in Argentina by country of origin in millions of dollars (selected countries) 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

USA 16422 7476 7989 10277 11689 12208 13601 13930 14012 14814 of total 238 231 208 182 187 176 175 172 175 168

Brazil 1953 2108 3280 1773 2488 2810 3659 4969 4319 5367 of total 283 651 856 314 397 406 470 614 539 608

China no data no data no data 13 11 45 120 141 123 5500 of total no data no data no data 002 002 006 015 017 015 623

Total 68935 32403 38323 56554 62639 69292 77899 80941 80144 88249

for the years 2001 2002 and 2003 the data for Brazil includes all FDI from South America excluding ChileFrom 2003 onwards the data is exclusively for BrazilSource INDEC and UNCTAD

Table 3

Argentinean trade with the European Union in millions of dollars 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Exports 4698 5309 6079 6209 6844 8010 9901 13173 10278 11026 Imports 4717 2107 2814 4237 4830 5811 7442 9043 6434 7587 Trade 219 3201 3265 1972 2013 2199 2458 4130 3845 3439 balance

FDI from the European Union in Argentina in millions of dollars 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

FDI 38279 18284 21273 33001 36848 40408 45159 45070 44963 47605 of total 5553 5643 5551 5835 5883 5832 5797 5568 5610 5394 Total 68935 32403 38323 56554 62639 69292 77899 80941 80144 88249

Source INDEC and UNCTAD

Dow

nloa

ded

by [

FU B

erlin

] at

02

37 0

5 N

ovem

ber

2014

  • Abstract
  • The United States and Brazil Losing and Gaining Centrality
  • Relations with China (and Asia) A Historic and Challenging Opportunity
  • Looking Ahead
  • Notes
  • Appendix
Page 14: Implications of the Global and Regional Changes for Argentina's Foreign Relations

Journal of Iberian and Latin American Research 263

Europe will increasingly lose its relative importance for Argentina and that its historically

privileged position in the countryrsquos foreign relations will be a thing of the past

Argentinarsquos relations with the United States have never been easy Joseph Tulchin

summarizes its nature in the title of his well-known book Argentina and the United States A Conflicted Relationship52 The strategy of lsquocouplingrsquo implemented during the Menem

years was a pragmatic adaptation to the world of the immediate post-Cold War and was

buried as a strategic option for Argentina with the 2001 crisis In the decade of 2000 the

Kirchners went back to the traditional historical pattern that we have called lsquolimited

oppositionrsquo53 This pattern which combines collaboration and disagreement deference

and resistance will continue to guide Argentinarsquos foreign policy toward Washington but

in a framework in which Buenos Airesrsquos concerns about restraining the United States

preponderance and power will tend to decrease Present conditions offer a great lsquoobjectiversquo

opportunity for the development of new areas of selective collaboration between the two

countries at the bilateral and regional levels A new era of relations with the United States

seems to be beginning for the Southern Cone one that is less unequal and perhaps more

cooperative The key challenge for Argentina is coping with a new reality of diminishing

influence of Washington in the sub-region Most of the time power erosion produces two

alternative behaviours adaptation or denial At least for the time being the relative decline

of US hegemony in South America is showing signs of a lsquosoft landingrsquo If this scenario

prevails then Argentina may manage its bilateral relation with the United States in a more

constructive way

In the case of Brazil it seems that we are entering a second long cycle of convergent

views about the place of this country in Argentinarsquos foreign policy54 This cycle may be

compared and opposed to another long period of convergent visions that characterized the

dominant form in which the neighbour country was perceived by the Argentine elites

during most of the twentieth century Today Brazil is defined as a strategic partner while

in the past until the return of both countries to democracy it was seen as a rival As we

have already mentioned the main challenge for Argentina is how to build this strategic

partnership within a framework of growing asymmetry

The link with Argentina although very important does not have today the same value

for Brazil as in the second half of the eighties By contrast the relationship with Brazil is

increasingly relevant for Argentinarsquos foreign relations and one that presents a significant

challenge In the past the relative symmetry between both countries was a constant source

of suspicion and conflict In the future the condition of asymmetric interdependence as a

structural feature of the relationship will not allow for competition but also is no

guarantee of friendship or cooperation Rather it can become a new source of suspicion

distrust and differences Argentina and Brazil will have to learn to live together in this new

reality and develop a broader framework of mutual understanding to manage the major

density of bilateral links and the global issues of common interests The greatest effort

must come from Argentina because it is the country that has a higher interest in the

relationship and more to gain

Finally the emergence of Asia is offering Argentina a unique opportunity for a

dynamic and successful international integration Its most recent economic dynamism is a

direct result of the increased demand from China and other Asian countries for food and

raw materials However Argentinarsquos exports to Asia are highly concentrated in the

soybean complex and to a much smaller extent in a small group of primary and natural

resource intensive products According to the latest ECLAC report five major products

accounted for 92 of total exports from Argentina to China during the years 2007 ndash 2009

(soybean 531 soybean oil 265 crude oil 747 other cattle 248 and meat and

Dow

nloa

ded

by [

FU B

erlin

] at

02

37 0

5 N

ovem

ber

2014

264 R Russell and J G Tokatlian

poultry offal 233)55 Moreover the trade surplus with China has tended to evaporate

after several years of significant positive balances

This situation raises many questions about the Argentine specialization pattern ndash

beyond issues related to trade with China ndash and the need to reduce an excessive

dependence on the export of commodities Nevertheless as the benefits of trade with

China have been so high and have also enabled Argentina to successfully face and resist

the financial crises in the centres the propensity to do nothing is great As Eric Farnsworth

recently observed lsquoWhen nations are able to sell as much as they can produce of any

particular product the thinking is generally to continue doing so and reap the rewards

When economies are growing there is little political imperative or incentive for reformrsquo56

In consequence a relevant question surrounding this type of relationship is how to avoid

the temptation to inertia The tendency towards passive repetition is appealing The China

lsquochallengersquo in the early twenty-first century for Argentina is how to think and act

differently from what had been the case of Argentine ndash British relations at the beginning of

the twentieth century The framing of a different link with Beijing as well as the positive

handling of an increasingly complex multifaceted multilevel relationship with Brazil

seem to be the major challenges ahead for Argentinarsquos foreign relations

Notes 1 Roberto Russell and Juan G Tokatlian El lugar de Brasil en la polıtica exterior argentina

Buenos Aires Fondo de Cultura Econo mica 2003 pp 45 ndash 59 2 We use the concept lsquosystemic changesrsquo in the same sense as Robert Gilpin See his book War

and Change in World Politics Cambridge Cambridge University Press 1981 pp 42ndash 43 3 For an interesting analysis of these debates see Jose Paradiso Debates y trayectoria de la

polıtica exterior argentina Buenos Aires Grupo Editor Latinoamericano 1993 4 On the concept lsquoasymmetryrsquo and its implications for bilateral relations see Brantley Womack

lsquoAsymmetry and Systemic Misperception China Vietnam and Cambodia during the 1970rsquosrsquo Journal of Strategic Studies 262 June 2003 pp 92ndash 119

5 On structural and relational power see Susan Strange States and Markets An Introduction to International Political Economy London Pinter 1988 pp 25ndash9

6 David C Kang lsquoThe theoretical roots of hierarchy in international relationsrsquo Australian Journal of International Affairs 583 September 2004 p 339

7 Roberto Russell and Juan G Tokatlian lsquoBeyond Orthodoxy Asserting Latin Americarsquos New Strategic Options Toward the United Statesrsquo Latin America Politics and Society 533 Winter 2011 pp 129 ndash 134

8 Eric Hobsbawm lsquoDespues del siglo XX un mundo en transicionrsquo in Ricardo Lagos (ed) America Latina iquestintegracion o fragmentacion Buenos Aires Edhasa 2008 pp 29ndash 47

9 Remarks by the President of the Argentine Republic Nestor Kirchner at the inauguration of the IV Summit of the Americas Mar del Plata httpwwwsummit-ameicasorgDocuments 20del20presidente20de20RepC3BAblica20Argentinapdf

10 La Nacion (Buenos Aires) lsquoCristina Kirchner critico a Obama con duros terminosrsquo 26 February 2010 Available at httpwwwlanacioncomar1237368-cristina-kirchner-criticoshya-obama-con-duros-terminos accessed 17 November 2011

11 For more in depth analysis of the bilateral relations see Russell and Tokatlian El lugar de Brasil pp 45ndash59 and Roberto Russell and Juan G Tokatlian lsquoPercepcoes argentinas sobre o Brasil ambivalencias e expectativasrsquo Polıtica Externa 202 September 2011 pp 43ndash 56

12 Monica Hirst lsquoLa polıtica sudamericana de Brasil entre el peso de las asimetrıas y la incidencia de nuevas coyunturasrsquo in F Calderon (ed) Escenarios polıticos en America Latina Conceptos metodos y Observatorio Regional Cuadernos de Gobernabilidad Democratica 2 Buenos Aires PNUD Siglo XXI 2008 p 257

13 We use the concept of friendship following Alexander Wendt Social Theory of International Politics Cambridge Cambridge UP 1999 pp 297ndash 308

14 La Nacion Economıa y Negocios Buenos Aires lsquoBrasil en la vida cotidiana argentinarsquo 22 May 2011 p 1

Dow

nloa

ded

by [

FU B

erlin

] at

02

37 0

5 N

ovem

ber

2014

Journal of Iberian and Latin American Research 265

15 On China ndash Latin America relations at the beginning of the XXI Century see Juan G Tokatlian lsquoA view from Latin Americarsquo in R Roett and G Paz (eds) Chinarsquos Expansion into the Western Hemisphere Implications for Latin America and the United States Washington DC Brookings Institution Press 2008

16 According toMark P Sullivan a specialist on Latin American affairs at theUS Congressional Research Service lsquoThe balance of opinion toward China and the United States in Latin America tend to be roughly comparable according to a (2007) Pew study Two exceptions are Argentina where China is viewed much more favorably than the United States and in Mexico where the United States is viewed much more favorably than Chinarsquo See Thomas Lum (ed) lsquoComparing Global Influence China and US Diplomacy Foreign Aid Trade and Investment in the Developing Worldrsquo in CRS Report to Congress August 15 2008

17 Kevin Gallagher lsquoLatin Americarsquos China challengersquo 2011 Policy Innovations httpwwwase tuftsedugdaePubsrpGallagher_PolicyInnovationsJan11pdf accessed 18 November 2011

18 Pablo Gerchunoff 2010 lsquoCausas y azares en mas de un siglo de historia econo mica argentinarsquo in R Russell (ed) Argentina 1910ndash2010 Balance de un siglo Buenos Aires Taurus p 152

19 See the complete quote in Sergio Cesarin lsquoChina y Argentina Enfoques y recomendaciones para potenciar la relacion bilateralrsquo Serie Aportes 2010 httplibraryfesdepdf-filesbueros argentinien07560pdf accessed 28 November 2011

20 Based on INDEC 2011 and Comercio Exterior Argentino 2010 httpwwwindecgovar accessed 13 November 2011

21 Camara de Exportadores de la Republica Argentina En Contcto China No 43 November 2011 p 16

22 In October 2009 President Cristina Fernandez de Kirchner visited India It was her first trip to an Asian country after her inauguration in December 2007 and it was the first visit of an Argentine president to India since 1994

23 It is important to mention the cases of Indonesia and Vietnam for two reasons the growth of trade in the last decade and the fact Argentine exports to these two countries are mainly nonshytraditional commodities For example exports to Indonesia jumped fromUS$43million in 2001 to US$852 million in 2010 while exports to Vietnam grew from US$60 million in 2001 to US $654 million in 2010 Cların iEco Buenos Aires lsquoArgentina en mas puertosrsquo 28 August 2011

24 La Nacion Economıa y Negocios Buenos Aires lsquoLa soja argentina ahora apunta a la Indiarsquo 15 September 2011 p 3

25 China Daily lsquoArgentina China sign tentative swap dealrsquo 31 March 2009 httpwww chinadailycomcnchina2009-0331content_7635007htm accessed 11 November 2011

26 Argenpress (Buenos Aires) lsquoInversiones chinas en la Argentina Claves del nuevo escenario energeticorsquo 14 June 2011 httpwwwargenpressinfo201106inversiones-chinas-enshyargentina-claveshtml accessed 19 November 2011

27 See text of the agreement at httpwwwgrrorgarrionegro-chinaacuerdo-saiz-chinapdf accessed 26 Nov 2011 and El Cronista Buenos Aires lsquoChina invierte 1500 millones en Rıo Negro para asegurarse alimentosrsquo 9 June 2011 httpwwwcronistacomnegocios China-invierte-us-1500-millones-en-Rio-Negro-para-asegurarse-alimentos-20110609-0033 html accessed 19 November 2011

28 On other actual and potential Chinese investments in Argentine provinces see Camara Argentino China Negocios con China 2011 httpwwwargenchinaorgarticulos_2010 NegociosConChinapdf accessed 14 November 2011 and FUNDAMIN lsquoChina invierte en las 23 provincias argentinasrsquo httpfundamincomaresinfo36-exportaciones-e-importaciones 299-china-invierte-en-las-23-provincias-argentinashtml accessed 19 November 2011

29 httpwwwnoalaminaorgmineria-informacion-generalgeneralargentina-china-recreacionshyde-la-vieja-qrelacion-especialq-con-gran-bretana accessed 20 January 2012

30 lsquoLas relaciones entre China y Argentinarsquo httpespanolcricn1161201211281s264119 htm accessed 17 November 2011

31 lsquoRailway rapprochement China invests in Argentinarsquo 2010 httpwwwas-coaorgarticles 2528Railway_Rapprochement_China_Invests_in_Argentina accessed 17 Nov 2011

32 Silvia Simonit lsquoLas empresas chinas en Argentinarsquo Chinese Studies Working Paper Series (Universitat Pompeu Fabra) No 1 2011

33 Loro Horta lsquoIn Uncle Samrsquos Backyard Chinarsquos Military Influence in Latin Americarsquo Military Review September-October 2008 p 48

Dow

nloa

ded

by [

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] at

02

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ovem

ber

2014

266 R Russell and J G Tokatlian

34 As are the cases of Brazil Chile Colombia and Venezuela 35 Seguridad y Defensa lsquoEl Ejercito Negocia con China la compra de helico pterosrsquo 10 October

2010 httpwwwseguridadydefensacomarnoticiasejercito-negocia-con-china-la-comprashyde-helicopteros-25059html accessed 10 November 2011

36 httpwwwelmetroonlinecomarindexphpoption frac14com_k2ampviewfrac14 itemampidfrac141067 purishycelli-firmC3B3-convenio-de-defensa-con-chinaampItemid frac14238 accessed 12 September 2012

37 China Military Online lsquoChang Wanquan holds talks with Argentine deputy Defense ministerrsquo 28 November 2011 httpengchinamilcomcnnews-channelschina-militaryshynews2011-1128content_4725893htm accessed 29 November 2011

38 T Wang et lsquoNew SRL station running in San Juan of Argentinarsquo Crustal Dynamics Data Information System nd httpcddisgsfcnasagovlw15docspapersNew20SLR20Station 20Running20in20San20Juan20of20Argentinapdf accessed 9 November 2011

39 Chinese Academy of Sciences lsquoChina Argentina to strengthen cooperation on Antarctic expeditionrsquo 16 August 2010 httpenglishbiccascnNE201008t20100816_57510html accessed 29 November 2011

40 Janie Hulse lsquoChinarsquos Expansion into and US withdrawal from Argentinarsquos telecommunicashytions and space industries and the implications for US national securityrsquo Strategic Studies Institute September 2007 httpwwwstrategicstudiesinstitutearmymilpdffilespub806pdf accessed 7 November 2011

41 Ministry of Science and Technology lsquoChina y la Argentina se reu nen para desarrollar un Centro Binacionalrsquo 2011 httpwwwmincytgovaragendaagenda_detalle phpid_ agendafrac1435 accessed 16 November 2011

42 httpwwwlmneuquencomarnoticias201282avanza-instalacion-de-una-estacion-satel ital-de-china-en-la-provincia_156999 accessed 14 October 2012

43 httpwwwstrategicstudiesinstitutearmymilpubssummarycfmqfrac14 806 accessed 29 November 2011 httpenergyseenewscomnewsargentina-china-sign-nuclear-coop eration-agreement-306141 accessed 3 November 2012

44 For the major reasons that motivated this interest see Lyle Goldstein lsquoChinarsquos Falklands Lessonsrsquo Survival 503 2008 pp 65-66

45 UKNDA Inconvenient Truths Threats Justify Prioritising Defence London UKNDA 2011 p 24

46 La Nacion Buenos Aires lsquoVivir en la Argentina estudiar en Chinarsquo 11 October 2011 http wwwlanacioncomar1413556-vivir-en-la-argentina-estudiar-en-china accessed 9 Novemshyber 2011

47 G M Calderon lsquoInmigracion china en las Americas Comparacion de las experiencias en Canada y Argentinarsquo Revista Argentina de Estudios Canadienses No 2 2008 p 30

48 La Nacion Buenos Aires lsquoChina Una oportunidad histo ricarsquo 26 July 2011 49 Juan Tokatlian lsquoLatin America China and the United States A Hopeful Trianglersquo 2007

Open Democracy httpwwwopendemocracynetdemocracy-protesthopeful_triangle_ 4336jsp accessed 4 November 2011

50 La Nacion Buenos Aires lsquoUna nueva estrategia hacia Chinarsquo 29 August 2011 51 Brantley Womack lsquoBeyond Win-Win Rethinking International Relationships in an Era of

Economic Uncertaintyrsquo Paper presented to the International Conference on the Chinese Models of Development Domestic and Global Aspects Taipei Taiwan September 2011

52 Joseph Tulchin Argentina and the United States A Conflicted Relationship New York Macmillan 1990

53 Russell and Tokatlian lsquoBeyond Orthodoxyrsquo 54 According to the latest report of Latinobaro metro 52 of the Argentines consider Brazil as

the main leader of Latin America while only 2 gives that condition to the United States http wwwlatinobarometroorglatinoLATContenidosjsp accessed 23 November 2011

55 Osvaldo Rosales lsquoLa Republica Popular China y America Latina y el Caribe Hacia una nueva fase en el vınculo econo mico comercialrsquo 2011 ECLAC httpwwweclacorgpubl icacionesxml643666La_Republica_Popular _China_y_America_Latina_y_el_Caribe _ tradepdf accessed 10 November 2011

56 Eric Farnsworth 2011 lsquoThe New Mercantilism Chinarsquos Emerging Role in the Americasrsquo Current History February Available at httpwwwas coaorgarticles2982The_New_shyMercantilism_Chinas_Emerging_Role_in_the_Americas accessed 28 November 2011

Dow

nloa

ded

by [

FU B

erlin

] at

02

37 0

5 N

ovem

ber

2014

Journal of Iberian and Latin American Research 267

Appendix 1

Table 1

Argentinean trade with Brazil in millions of dollars 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Exports 6206 4828 4666 5587 6335 8141 10498 13272 11374 14420 Imports 5230 2517 4700 7567 10187 11749 14523 17687 11822 17658 Trade 975 2310 233 21980 23852 23608 24025 24415 2448 23238 balance

Argentinean trade with the United States in millions of dollars 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Exports 2840 2869 3364 3733 4493 4025 4153 5095 3465 3656 Imports 3737 1789 2238 3389 3998 4247 5264 6894 5106 6125 Trade 2897 1080 1126 344 495 2222 21111 21799 21641 22469 balance

Argentinean trade with China in millions of dollars 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Exports 1123 1092 2483 2628 3193 3476 5170 6355 3668 6117 Imports 1066 330 721 1402 2237 3122 5093 7104 4823 7678 Trade 56 762 1762 1227 956 354 77 2 749 2 1155 2 1561 balance

Source INDEC and UNCTAD

Table 2

FDI stock in Argentina by country of origin in millions of dollars (selected countries) 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

USA 16422 7476 7989 10277 11689 12208 13601 13930 14012 14814 of total 238 231 208 182 187 176 175 172 175 168

Brazil 1953 2108 3280 1773 2488 2810 3659 4969 4319 5367 of total 283 651 856 314 397 406 470 614 539 608

China no data no data no data 13 11 45 120 141 123 5500 of total no data no data no data 002 002 006 015 017 015 623

Total 68935 32403 38323 56554 62639 69292 77899 80941 80144 88249

for the years 2001 2002 and 2003 the data for Brazil includes all FDI from South America excluding ChileFrom 2003 onwards the data is exclusively for BrazilSource INDEC and UNCTAD

Table 3

Argentinean trade with the European Union in millions of dollars 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Exports 4698 5309 6079 6209 6844 8010 9901 13173 10278 11026 Imports 4717 2107 2814 4237 4830 5811 7442 9043 6434 7587 Trade 219 3201 3265 1972 2013 2199 2458 4130 3845 3439 balance

FDI from the European Union in Argentina in millions of dollars 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

FDI 38279 18284 21273 33001 36848 40408 45159 45070 44963 47605 of total 5553 5643 5551 5835 5883 5832 5797 5568 5610 5394 Total 68935 32403 38323 56554 62639 69292 77899 80941 80144 88249

Source INDEC and UNCTAD

Dow

nloa

ded

by [

FU B

erlin

] at

02

37 0

5 N

ovem

ber

2014

  • Abstract
  • The United States and Brazil Losing and Gaining Centrality
  • Relations with China (and Asia) A Historic and Challenging Opportunity
  • Looking Ahead
  • Notes
  • Appendix
Page 15: Implications of the Global and Regional Changes for Argentina's Foreign Relations

264 R Russell and J G Tokatlian

poultry offal 233)55 Moreover the trade surplus with China has tended to evaporate

after several years of significant positive balances

This situation raises many questions about the Argentine specialization pattern ndash

beyond issues related to trade with China ndash and the need to reduce an excessive

dependence on the export of commodities Nevertheless as the benefits of trade with

China have been so high and have also enabled Argentina to successfully face and resist

the financial crises in the centres the propensity to do nothing is great As Eric Farnsworth

recently observed lsquoWhen nations are able to sell as much as they can produce of any

particular product the thinking is generally to continue doing so and reap the rewards

When economies are growing there is little political imperative or incentive for reformrsquo56

In consequence a relevant question surrounding this type of relationship is how to avoid

the temptation to inertia The tendency towards passive repetition is appealing The China

lsquochallengersquo in the early twenty-first century for Argentina is how to think and act

differently from what had been the case of Argentine ndash British relations at the beginning of

the twentieth century The framing of a different link with Beijing as well as the positive

handling of an increasingly complex multifaceted multilevel relationship with Brazil

seem to be the major challenges ahead for Argentinarsquos foreign relations

Notes 1 Roberto Russell and Juan G Tokatlian El lugar de Brasil en la polıtica exterior argentina

Buenos Aires Fondo de Cultura Econo mica 2003 pp 45 ndash 59 2 We use the concept lsquosystemic changesrsquo in the same sense as Robert Gilpin See his book War

and Change in World Politics Cambridge Cambridge University Press 1981 pp 42ndash 43 3 For an interesting analysis of these debates see Jose Paradiso Debates y trayectoria de la

polıtica exterior argentina Buenos Aires Grupo Editor Latinoamericano 1993 4 On the concept lsquoasymmetryrsquo and its implications for bilateral relations see Brantley Womack

lsquoAsymmetry and Systemic Misperception China Vietnam and Cambodia during the 1970rsquosrsquo Journal of Strategic Studies 262 June 2003 pp 92ndash 119

5 On structural and relational power see Susan Strange States and Markets An Introduction to International Political Economy London Pinter 1988 pp 25ndash9

6 David C Kang lsquoThe theoretical roots of hierarchy in international relationsrsquo Australian Journal of International Affairs 583 September 2004 p 339

7 Roberto Russell and Juan G Tokatlian lsquoBeyond Orthodoxy Asserting Latin Americarsquos New Strategic Options Toward the United Statesrsquo Latin America Politics and Society 533 Winter 2011 pp 129 ndash 134

8 Eric Hobsbawm lsquoDespues del siglo XX un mundo en transicionrsquo in Ricardo Lagos (ed) America Latina iquestintegracion o fragmentacion Buenos Aires Edhasa 2008 pp 29ndash 47

9 Remarks by the President of the Argentine Republic Nestor Kirchner at the inauguration of the IV Summit of the Americas Mar del Plata httpwwwsummit-ameicasorgDocuments 20del20presidente20de20RepC3BAblica20Argentinapdf

10 La Nacion (Buenos Aires) lsquoCristina Kirchner critico a Obama con duros terminosrsquo 26 February 2010 Available at httpwwwlanacioncomar1237368-cristina-kirchner-criticoshya-obama-con-duros-terminos accessed 17 November 2011

11 For more in depth analysis of the bilateral relations see Russell and Tokatlian El lugar de Brasil pp 45ndash59 and Roberto Russell and Juan G Tokatlian lsquoPercepcoes argentinas sobre o Brasil ambivalencias e expectativasrsquo Polıtica Externa 202 September 2011 pp 43ndash 56

12 Monica Hirst lsquoLa polıtica sudamericana de Brasil entre el peso de las asimetrıas y la incidencia de nuevas coyunturasrsquo in F Calderon (ed) Escenarios polıticos en America Latina Conceptos metodos y Observatorio Regional Cuadernos de Gobernabilidad Democratica 2 Buenos Aires PNUD Siglo XXI 2008 p 257

13 We use the concept of friendship following Alexander Wendt Social Theory of International Politics Cambridge Cambridge UP 1999 pp 297ndash 308

14 La Nacion Economıa y Negocios Buenos Aires lsquoBrasil en la vida cotidiana argentinarsquo 22 May 2011 p 1

Dow

nloa

ded

by [

FU B

erlin

] at

02

37 0

5 N

ovem

ber

2014

Journal of Iberian and Latin American Research 265

15 On China ndash Latin America relations at the beginning of the XXI Century see Juan G Tokatlian lsquoA view from Latin Americarsquo in R Roett and G Paz (eds) Chinarsquos Expansion into the Western Hemisphere Implications for Latin America and the United States Washington DC Brookings Institution Press 2008

16 According toMark P Sullivan a specialist on Latin American affairs at theUS Congressional Research Service lsquoThe balance of opinion toward China and the United States in Latin America tend to be roughly comparable according to a (2007) Pew study Two exceptions are Argentina where China is viewed much more favorably than the United States and in Mexico where the United States is viewed much more favorably than Chinarsquo See Thomas Lum (ed) lsquoComparing Global Influence China and US Diplomacy Foreign Aid Trade and Investment in the Developing Worldrsquo in CRS Report to Congress August 15 2008

17 Kevin Gallagher lsquoLatin Americarsquos China challengersquo 2011 Policy Innovations httpwwwase tuftsedugdaePubsrpGallagher_PolicyInnovationsJan11pdf accessed 18 November 2011

18 Pablo Gerchunoff 2010 lsquoCausas y azares en mas de un siglo de historia econo mica argentinarsquo in R Russell (ed) Argentina 1910ndash2010 Balance de un siglo Buenos Aires Taurus p 152

19 See the complete quote in Sergio Cesarin lsquoChina y Argentina Enfoques y recomendaciones para potenciar la relacion bilateralrsquo Serie Aportes 2010 httplibraryfesdepdf-filesbueros argentinien07560pdf accessed 28 November 2011

20 Based on INDEC 2011 and Comercio Exterior Argentino 2010 httpwwwindecgovar accessed 13 November 2011

21 Camara de Exportadores de la Republica Argentina En Contcto China No 43 November 2011 p 16

22 In October 2009 President Cristina Fernandez de Kirchner visited India It was her first trip to an Asian country after her inauguration in December 2007 and it was the first visit of an Argentine president to India since 1994

23 It is important to mention the cases of Indonesia and Vietnam for two reasons the growth of trade in the last decade and the fact Argentine exports to these two countries are mainly nonshytraditional commodities For example exports to Indonesia jumped fromUS$43million in 2001 to US$852 million in 2010 while exports to Vietnam grew from US$60 million in 2001 to US $654 million in 2010 Cların iEco Buenos Aires lsquoArgentina en mas puertosrsquo 28 August 2011

24 La Nacion Economıa y Negocios Buenos Aires lsquoLa soja argentina ahora apunta a la Indiarsquo 15 September 2011 p 3

25 China Daily lsquoArgentina China sign tentative swap dealrsquo 31 March 2009 httpwww chinadailycomcnchina2009-0331content_7635007htm accessed 11 November 2011

26 Argenpress (Buenos Aires) lsquoInversiones chinas en la Argentina Claves del nuevo escenario energeticorsquo 14 June 2011 httpwwwargenpressinfo201106inversiones-chinas-enshyargentina-claveshtml accessed 19 November 2011

27 See text of the agreement at httpwwwgrrorgarrionegro-chinaacuerdo-saiz-chinapdf accessed 26 Nov 2011 and El Cronista Buenos Aires lsquoChina invierte 1500 millones en Rıo Negro para asegurarse alimentosrsquo 9 June 2011 httpwwwcronistacomnegocios China-invierte-us-1500-millones-en-Rio-Negro-para-asegurarse-alimentos-20110609-0033 html accessed 19 November 2011

28 On other actual and potential Chinese investments in Argentine provinces see Camara Argentino China Negocios con China 2011 httpwwwargenchinaorgarticulos_2010 NegociosConChinapdf accessed 14 November 2011 and FUNDAMIN lsquoChina invierte en las 23 provincias argentinasrsquo httpfundamincomaresinfo36-exportaciones-e-importaciones 299-china-invierte-en-las-23-provincias-argentinashtml accessed 19 November 2011

29 httpwwwnoalaminaorgmineria-informacion-generalgeneralargentina-china-recreacionshyde-la-vieja-qrelacion-especialq-con-gran-bretana accessed 20 January 2012

30 lsquoLas relaciones entre China y Argentinarsquo httpespanolcricn1161201211281s264119 htm accessed 17 November 2011

31 lsquoRailway rapprochement China invests in Argentinarsquo 2010 httpwwwas-coaorgarticles 2528Railway_Rapprochement_China_Invests_in_Argentina accessed 17 Nov 2011

32 Silvia Simonit lsquoLas empresas chinas en Argentinarsquo Chinese Studies Working Paper Series (Universitat Pompeu Fabra) No 1 2011

33 Loro Horta lsquoIn Uncle Samrsquos Backyard Chinarsquos Military Influence in Latin Americarsquo Military Review September-October 2008 p 48

Dow

nloa

ded

by [

FU B

erlin

] at

02

37 0

5 N

ovem

ber

2014

266 R Russell and J G Tokatlian

34 As are the cases of Brazil Chile Colombia and Venezuela 35 Seguridad y Defensa lsquoEl Ejercito Negocia con China la compra de helico pterosrsquo 10 October

2010 httpwwwseguridadydefensacomarnoticiasejercito-negocia-con-china-la-comprashyde-helicopteros-25059html accessed 10 November 2011

36 httpwwwelmetroonlinecomarindexphpoption frac14com_k2ampviewfrac14 itemampidfrac141067 purishycelli-firmC3B3-convenio-de-defensa-con-chinaampItemid frac14238 accessed 12 September 2012

37 China Military Online lsquoChang Wanquan holds talks with Argentine deputy Defense ministerrsquo 28 November 2011 httpengchinamilcomcnnews-channelschina-militaryshynews2011-1128content_4725893htm accessed 29 November 2011

38 T Wang et lsquoNew SRL station running in San Juan of Argentinarsquo Crustal Dynamics Data Information System nd httpcddisgsfcnasagovlw15docspapersNew20SLR20Station 20Running20in20San20Juan20of20Argentinapdf accessed 9 November 2011

39 Chinese Academy of Sciences lsquoChina Argentina to strengthen cooperation on Antarctic expeditionrsquo 16 August 2010 httpenglishbiccascnNE201008t20100816_57510html accessed 29 November 2011

40 Janie Hulse lsquoChinarsquos Expansion into and US withdrawal from Argentinarsquos telecommunicashytions and space industries and the implications for US national securityrsquo Strategic Studies Institute September 2007 httpwwwstrategicstudiesinstitutearmymilpdffilespub806pdf accessed 7 November 2011

41 Ministry of Science and Technology lsquoChina y la Argentina se reu nen para desarrollar un Centro Binacionalrsquo 2011 httpwwwmincytgovaragendaagenda_detalle phpid_ agendafrac1435 accessed 16 November 2011

42 httpwwwlmneuquencomarnoticias201282avanza-instalacion-de-una-estacion-satel ital-de-china-en-la-provincia_156999 accessed 14 October 2012

43 httpwwwstrategicstudiesinstitutearmymilpubssummarycfmqfrac14 806 accessed 29 November 2011 httpenergyseenewscomnewsargentina-china-sign-nuclear-coop eration-agreement-306141 accessed 3 November 2012

44 For the major reasons that motivated this interest see Lyle Goldstein lsquoChinarsquos Falklands Lessonsrsquo Survival 503 2008 pp 65-66

45 UKNDA Inconvenient Truths Threats Justify Prioritising Defence London UKNDA 2011 p 24

46 La Nacion Buenos Aires lsquoVivir en la Argentina estudiar en Chinarsquo 11 October 2011 http wwwlanacioncomar1413556-vivir-en-la-argentina-estudiar-en-china accessed 9 Novemshyber 2011

47 G M Calderon lsquoInmigracion china en las Americas Comparacion de las experiencias en Canada y Argentinarsquo Revista Argentina de Estudios Canadienses No 2 2008 p 30

48 La Nacion Buenos Aires lsquoChina Una oportunidad histo ricarsquo 26 July 2011 49 Juan Tokatlian lsquoLatin America China and the United States A Hopeful Trianglersquo 2007

Open Democracy httpwwwopendemocracynetdemocracy-protesthopeful_triangle_ 4336jsp accessed 4 November 2011

50 La Nacion Buenos Aires lsquoUna nueva estrategia hacia Chinarsquo 29 August 2011 51 Brantley Womack lsquoBeyond Win-Win Rethinking International Relationships in an Era of

Economic Uncertaintyrsquo Paper presented to the International Conference on the Chinese Models of Development Domestic and Global Aspects Taipei Taiwan September 2011

52 Joseph Tulchin Argentina and the United States A Conflicted Relationship New York Macmillan 1990

53 Russell and Tokatlian lsquoBeyond Orthodoxyrsquo 54 According to the latest report of Latinobaro metro 52 of the Argentines consider Brazil as

the main leader of Latin America while only 2 gives that condition to the United States http wwwlatinobarometroorglatinoLATContenidosjsp accessed 23 November 2011

55 Osvaldo Rosales lsquoLa Republica Popular China y America Latina y el Caribe Hacia una nueva fase en el vınculo econo mico comercialrsquo 2011 ECLAC httpwwweclacorgpubl icacionesxml643666La_Republica_Popular _China_y_America_Latina_y_el_Caribe _ tradepdf accessed 10 November 2011

56 Eric Farnsworth 2011 lsquoThe New Mercantilism Chinarsquos Emerging Role in the Americasrsquo Current History February Available at httpwwwas coaorgarticles2982The_New_shyMercantilism_Chinas_Emerging_Role_in_the_Americas accessed 28 November 2011

Dow

nloa

ded

by [

FU B

erlin

] at

02

37 0

5 N

ovem

ber

2014

Journal of Iberian and Latin American Research 267

Appendix 1

Table 1

Argentinean trade with Brazil in millions of dollars 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Exports 6206 4828 4666 5587 6335 8141 10498 13272 11374 14420 Imports 5230 2517 4700 7567 10187 11749 14523 17687 11822 17658 Trade 975 2310 233 21980 23852 23608 24025 24415 2448 23238 balance

Argentinean trade with the United States in millions of dollars 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Exports 2840 2869 3364 3733 4493 4025 4153 5095 3465 3656 Imports 3737 1789 2238 3389 3998 4247 5264 6894 5106 6125 Trade 2897 1080 1126 344 495 2222 21111 21799 21641 22469 balance

Argentinean trade with China in millions of dollars 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Exports 1123 1092 2483 2628 3193 3476 5170 6355 3668 6117 Imports 1066 330 721 1402 2237 3122 5093 7104 4823 7678 Trade 56 762 1762 1227 956 354 77 2 749 2 1155 2 1561 balance

Source INDEC and UNCTAD

Table 2

FDI stock in Argentina by country of origin in millions of dollars (selected countries) 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

USA 16422 7476 7989 10277 11689 12208 13601 13930 14012 14814 of total 238 231 208 182 187 176 175 172 175 168

Brazil 1953 2108 3280 1773 2488 2810 3659 4969 4319 5367 of total 283 651 856 314 397 406 470 614 539 608

China no data no data no data 13 11 45 120 141 123 5500 of total no data no data no data 002 002 006 015 017 015 623

Total 68935 32403 38323 56554 62639 69292 77899 80941 80144 88249

for the years 2001 2002 and 2003 the data for Brazil includes all FDI from South America excluding ChileFrom 2003 onwards the data is exclusively for BrazilSource INDEC and UNCTAD

Table 3

Argentinean trade with the European Union in millions of dollars 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Exports 4698 5309 6079 6209 6844 8010 9901 13173 10278 11026 Imports 4717 2107 2814 4237 4830 5811 7442 9043 6434 7587 Trade 219 3201 3265 1972 2013 2199 2458 4130 3845 3439 balance

FDI from the European Union in Argentina in millions of dollars 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

FDI 38279 18284 21273 33001 36848 40408 45159 45070 44963 47605 of total 5553 5643 5551 5835 5883 5832 5797 5568 5610 5394 Total 68935 32403 38323 56554 62639 69292 77899 80941 80144 88249

Source INDEC and UNCTAD

Dow

nloa

ded

by [

FU B

erlin

] at

02

37 0

5 N

ovem

ber

2014

  • Abstract
  • The United States and Brazil Losing and Gaining Centrality
  • Relations with China (and Asia) A Historic and Challenging Opportunity
  • Looking Ahead
  • Notes
  • Appendix
Page 16: Implications of the Global and Regional Changes for Argentina's Foreign Relations

Journal of Iberian and Latin American Research 265

15 On China ndash Latin America relations at the beginning of the XXI Century see Juan G Tokatlian lsquoA view from Latin Americarsquo in R Roett and G Paz (eds) Chinarsquos Expansion into the Western Hemisphere Implications for Latin America and the United States Washington DC Brookings Institution Press 2008

16 According toMark P Sullivan a specialist on Latin American affairs at theUS Congressional Research Service lsquoThe balance of opinion toward China and the United States in Latin America tend to be roughly comparable according to a (2007) Pew study Two exceptions are Argentina where China is viewed much more favorably than the United States and in Mexico where the United States is viewed much more favorably than Chinarsquo See Thomas Lum (ed) lsquoComparing Global Influence China and US Diplomacy Foreign Aid Trade and Investment in the Developing Worldrsquo in CRS Report to Congress August 15 2008

17 Kevin Gallagher lsquoLatin Americarsquos China challengersquo 2011 Policy Innovations httpwwwase tuftsedugdaePubsrpGallagher_PolicyInnovationsJan11pdf accessed 18 November 2011

18 Pablo Gerchunoff 2010 lsquoCausas y azares en mas de un siglo de historia econo mica argentinarsquo in R Russell (ed) Argentina 1910ndash2010 Balance de un siglo Buenos Aires Taurus p 152

19 See the complete quote in Sergio Cesarin lsquoChina y Argentina Enfoques y recomendaciones para potenciar la relacion bilateralrsquo Serie Aportes 2010 httplibraryfesdepdf-filesbueros argentinien07560pdf accessed 28 November 2011

20 Based on INDEC 2011 and Comercio Exterior Argentino 2010 httpwwwindecgovar accessed 13 November 2011

21 Camara de Exportadores de la Republica Argentina En Contcto China No 43 November 2011 p 16

22 In October 2009 President Cristina Fernandez de Kirchner visited India It was her first trip to an Asian country after her inauguration in December 2007 and it was the first visit of an Argentine president to India since 1994

23 It is important to mention the cases of Indonesia and Vietnam for two reasons the growth of trade in the last decade and the fact Argentine exports to these two countries are mainly nonshytraditional commodities For example exports to Indonesia jumped fromUS$43million in 2001 to US$852 million in 2010 while exports to Vietnam grew from US$60 million in 2001 to US $654 million in 2010 Cların iEco Buenos Aires lsquoArgentina en mas puertosrsquo 28 August 2011

24 La Nacion Economıa y Negocios Buenos Aires lsquoLa soja argentina ahora apunta a la Indiarsquo 15 September 2011 p 3

25 China Daily lsquoArgentina China sign tentative swap dealrsquo 31 March 2009 httpwww chinadailycomcnchina2009-0331content_7635007htm accessed 11 November 2011

26 Argenpress (Buenos Aires) lsquoInversiones chinas en la Argentina Claves del nuevo escenario energeticorsquo 14 June 2011 httpwwwargenpressinfo201106inversiones-chinas-enshyargentina-claveshtml accessed 19 November 2011

27 See text of the agreement at httpwwwgrrorgarrionegro-chinaacuerdo-saiz-chinapdf accessed 26 Nov 2011 and El Cronista Buenos Aires lsquoChina invierte 1500 millones en Rıo Negro para asegurarse alimentosrsquo 9 June 2011 httpwwwcronistacomnegocios China-invierte-us-1500-millones-en-Rio-Negro-para-asegurarse-alimentos-20110609-0033 html accessed 19 November 2011

28 On other actual and potential Chinese investments in Argentine provinces see Camara Argentino China Negocios con China 2011 httpwwwargenchinaorgarticulos_2010 NegociosConChinapdf accessed 14 November 2011 and FUNDAMIN lsquoChina invierte en las 23 provincias argentinasrsquo httpfundamincomaresinfo36-exportaciones-e-importaciones 299-china-invierte-en-las-23-provincias-argentinashtml accessed 19 November 2011

29 httpwwwnoalaminaorgmineria-informacion-generalgeneralargentina-china-recreacionshyde-la-vieja-qrelacion-especialq-con-gran-bretana accessed 20 January 2012

30 lsquoLas relaciones entre China y Argentinarsquo httpespanolcricn1161201211281s264119 htm accessed 17 November 2011

31 lsquoRailway rapprochement China invests in Argentinarsquo 2010 httpwwwas-coaorgarticles 2528Railway_Rapprochement_China_Invests_in_Argentina accessed 17 Nov 2011

32 Silvia Simonit lsquoLas empresas chinas en Argentinarsquo Chinese Studies Working Paper Series (Universitat Pompeu Fabra) No 1 2011

33 Loro Horta lsquoIn Uncle Samrsquos Backyard Chinarsquos Military Influence in Latin Americarsquo Military Review September-October 2008 p 48

Dow

nloa

ded

by [

FU B

erlin

] at

02

37 0

5 N

ovem

ber

2014

266 R Russell and J G Tokatlian

34 As are the cases of Brazil Chile Colombia and Venezuela 35 Seguridad y Defensa lsquoEl Ejercito Negocia con China la compra de helico pterosrsquo 10 October

2010 httpwwwseguridadydefensacomarnoticiasejercito-negocia-con-china-la-comprashyde-helicopteros-25059html accessed 10 November 2011

36 httpwwwelmetroonlinecomarindexphpoption frac14com_k2ampviewfrac14 itemampidfrac141067 purishycelli-firmC3B3-convenio-de-defensa-con-chinaampItemid frac14238 accessed 12 September 2012

37 China Military Online lsquoChang Wanquan holds talks with Argentine deputy Defense ministerrsquo 28 November 2011 httpengchinamilcomcnnews-channelschina-militaryshynews2011-1128content_4725893htm accessed 29 November 2011

38 T Wang et lsquoNew SRL station running in San Juan of Argentinarsquo Crustal Dynamics Data Information System nd httpcddisgsfcnasagovlw15docspapersNew20SLR20Station 20Running20in20San20Juan20of20Argentinapdf accessed 9 November 2011

39 Chinese Academy of Sciences lsquoChina Argentina to strengthen cooperation on Antarctic expeditionrsquo 16 August 2010 httpenglishbiccascnNE201008t20100816_57510html accessed 29 November 2011

40 Janie Hulse lsquoChinarsquos Expansion into and US withdrawal from Argentinarsquos telecommunicashytions and space industries and the implications for US national securityrsquo Strategic Studies Institute September 2007 httpwwwstrategicstudiesinstitutearmymilpdffilespub806pdf accessed 7 November 2011

41 Ministry of Science and Technology lsquoChina y la Argentina se reu nen para desarrollar un Centro Binacionalrsquo 2011 httpwwwmincytgovaragendaagenda_detalle phpid_ agendafrac1435 accessed 16 November 2011

42 httpwwwlmneuquencomarnoticias201282avanza-instalacion-de-una-estacion-satel ital-de-china-en-la-provincia_156999 accessed 14 October 2012

43 httpwwwstrategicstudiesinstitutearmymilpubssummarycfmqfrac14 806 accessed 29 November 2011 httpenergyseenewscomnewsargentina-china-sign-nuclear-coop eration-agreement-306141 accessed 3 November 2012

44 For the major reasons that motivated this interest see Lyle Goldstein lsquoChinarsquos Falklands Lessonsrsquo Survival 503 2008 pp 65-66

45 UKNDA Inconvenient Truths Threats Justify Prioritising Defence London UKNDA 2011 p 24

46 La Nacion Buenos Aires lsquoVivir en la Argentina estudiar en Chinarsquo 11 October 2011 http wwwlanacioncomar1413556-vivir-en-la-argentina-estudiar-en-china accessed 9 Novemshyber 2011

47 G M Calderon lsquoInmigracion china en las Americas Comparacion de las experiencias en Canada y Argentinarsquo Revista Argentina de Estudios Canadienses No 2 2008 p 30

48 La Nacion Buenos Aires lsquoChina Una oportunidad histo ricarsquo 26 July 2011 49 Juan Tokatlian lsquoLatin America China and the United States A Hopeful Trianglersquo 2007

Open Democracy httpwwwopendemocracynetdemocracy-protesthopeful_triangle_ 4336jsp accessed 4 November 2011

50 La Nacion Buenos Aires lsquoUna nueva estrategia hacia Chinarsquo 29 August 2011 51 Brantley Womack lsquoBeyond Win-Win Rethinking International Relationships in an Era of

Economic Uncertaintyrsquo Paper presented to the International Conference on the Chinese Models of Development Domestic and Global Aspects Taipei Taiwan September 2011

52 Joseph Tulchin Argentina and the United States A Conflicted Relationship New York Macmillan 1990

53 Russell and Tokatlian lsquoBeyond Orthodoxyrsquo 54 According to the latest report of Latinobaro metro 52 of the Argentines consider Brazil as

the main leader of Latin America while only 2 gives that condition to the United States http wwwlatinobarometroorglatinoLATContenidosjsp accessed 23 November 2011

55 Osvaldo Rosales lsquoLa Republica Popular China y America Latina y el Caribe Hacia una nueva fase en el vınculo econo mico comercialrsquo 2011 ECLAC httpwwweclacorgpubl icacionesxml643666La_Republica_Popular _China_y_America_Latina_y_el_Caribe _ tradepdf accessed 10 November 2011

56 Eric Farnsworth 2011 lsquoThe New Mercantilism Chinarsquos Emerging Role in the Americasrsquo Current History February Available at httpwwwas coaorgarticles2982The_New_shyMercantilism_Chinas_Emerging_Role_in_the_Americas accessed 28 November 2011

Dow

nloa

ded

by [

FU B

erlin

] at

02

37 0

5 N

ovem

ber

2014

Journal of Iberian and Latin American Research 267

Appendix 1

Table 1

Argentinean trade with Brazil in millions of dollars 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Exports 6206 4828 4666 5587 6335 8141 10498 13272 11374 14420 Imports 5230 2517 4700 7567 10187 11749 14523 17687 11822 17658 Trade 975 2310 233 21980 23852 23608 24025 24415 2448 23238 balance

Argentinean trade with the United States in millions of dollars 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Exports 2840 2869 3364 3733 4493 4025 4153 5095 3465 3656 Imports 3737 1789 2238 3389 3998 4247 5264 6894 5106 6125 Trade 2897 1080 1126 344 495 2222 21111 21799 21641 22469 balance

Argentinean trade with China in millions of dollars 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Exports 1123 1092 2483 2628 3193 3476 5170 6355 3668 6117 Imports 1066 330 721 1402 2237 3122 5093 7104 4823 7678 Trade 56 762 1762 1227 956 354 77 2 749 2 1155 2 1561 balance

Source INDEC and UNCTAD

Table 2

FDI stock in Argentina by country of origin in millions of dollars (selected countries) 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

USA 16422 7476 7989 10277 11689 12208 13601 13930 14012 14814 of total 238 231 208 182 187 176 175 172 175 168

Brazil 1953 2108 3280 1773 2488 2810 3659 4969 4319 5367 of total 283 651 856 314 397 406 470 614 539 608

China no data no data no data 13 11 45 120 141 123 5500 of total no data no data no data 002 002 006 015 017 015 623

Total 68935 32403 38323 56554 62639 69292 77899 80941 80144 88249

for the years 2001 2002 and 2003 the data for Brazil includes all FDI from South America excluding ChileFrom 2003 onwards the data is exclusively for BrazilSource INDEC and UNCTAD

Table 3

Argentinean trade with the European Union in millions of dollars 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Exports 4698 5309 6079 6209 6844 8010 9901 13173 10278 11026 Imports 4717 2107 2814 4237 4830 5811 7442 9043 6434 7587 Trade 219 3201 3265 1972 2013 2199 2458 4130 3845 3439 balance

FDI from the European Union in Argentina in millions of dollars 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

FDI 38279 18284 21273 33001 36848 40408 45159 45070 44963 47605 of total 5553 5643 5551 5835 5883 5832 5797 5568 5610 5394 Total 68935 32403 38323 56554 62639 69292 77899 80941 80144 88249

Source INDEC and UNCTAD

Dow

nloa

ded

by [

FU B

erlin

] at

02

37 0

5 N

ovem

ber

2014

  • Abstract
  • The United States and Brazil Losing and Gaining Centrality
  • Relations with China (and Asia) A Historic and Challenging Opportunity
  • Looking Ahead
  • Notes
  • Appendix
Page 17: Implications of the Global and Regional Changes for Argentina's Foreign Relations

266 R Russell and J G Tokatlian

34 As are the cases of Brazil Chile Colombia and Venezuela 35 Seguridad y Defensa lsquoEl Ejercito Negocia con China la compra de helico pterosrsquo 10 October

2010 httpwwwseguridadydefensacomarnoticiasejercito-negocia-con-china-la-comprashyde-helicopteros-25059html accessed 10 November 2011

36 httpwwwelmetroonlinecomarindexphpoption frac14com_k2ampviewfrac14 itemampidfrac141067 purishycelli-firmC3B3-convenio-de-defensa-con-chinaampItemid frac14238 accessed 12 September 2012

37 China Military Online lsquoChang Wanquan holds talks with Argentine deputy Defense ministerrsquo 28 November 2011 httpengchinamilcomcnnews-channelschina-militaryshynews2011-1128content_4725893htm accessed 29 November 2011

38 T Wang et lsquoNew SRL station running in San Juan of Argentinarsquo Crustal Dynamics Data Information System nd httpcddisgsfcnasagovlw15docspapersNew20SLR20Station 20Running20in20San20Juan20of20Argentinapdf accessed 9 November 2011

39 Chinese Academy of Sciences lsquoChina Argentina to strengthen cooperation on Antarctic expeditionrsquo 16 August 2010 httpenglishbiccascnNE201008t20100816_57510html accessed 29 November 2011

40 Janie Hulse lsquoChinarsquos Expansion into and US withdrawal from Argentinarsquos telecommunicashytions and space industries and the implications for US national securityrsquo Strategic Studies Institute September 2007 httpwwwstrategicstudiesinstitutearmymilpdffilespub806pdf accessed 7 November 2011

41 Ministry of Science and Technology lsquoChina y la Argentina se reu nen para desarrollar un Centro Binacionalrsquo 2011 httpwwwmincytgovaragendaagenda_detalle phpid_ agendafrac1435 accessed 16 November 2011

42 httpwwwlmneuquencomarnoticias201282avanza-instalacion-de-una-estacion-satel ital-de-china-en-la-provincia_156999 accessed 14 October 2012

43 httpwwwstrategicstudiesinstitutearmymilpubssummarycfmqfrac14 806 accessed 29 November 2011 httpenergyseenewscomnewsargentina-china-sign-nuclear-coop eration-agreement-306141 accessed 3 November 2012

44 For the major reasons that motivated this interest see Lyle Goldstein lsquoChinarsquos Falklands Lessonsrsquo Survival 503 2008 pp 65-66

45 UKNDA Inconvenient Truths Threats Justify Prioritising Defence London UKNDA 2011 p 24

46 La Nacion Buenos Aires lsquoVivir en la Argentina estudiar en Chinarsquo 11 October 2011 http wwwlanacioncomar1413556-vivir-en-la-argentina-estudiar-en-china accessed 9 Novemshyber 2011

47 G M Calderon lsquoInmigracion china en las Americas Comparacion de las experiencias en Canada y Argentinarsquo Revista Argentina de Estudios Canadienses No 2 2008 p 30

48 La Nacion Buenos Aires lsquoChina Una oportunidad histo ricarsquo 26 July 2011 49 Juan Tokatlian lsquoLatin America China and the United States A Hopeful Trianglersquo 2007

Open Democracy httpwwwopendemocracynetdemocracy-protesthopeful_triangle_ 4336jsp accessed 4 November 2011

50 La Nacion Buenos Aires lsquoUna nueva estrategia hacia Chinarsquo 29 August 2011 51 Brantley Womack lsquoBeyond Win-Win Rethinking International Relationships in an Era of

Economic Uncertaintyrsquo Paper presented to the International Conference on the Chinese Models of Development Domestic and Global Aspects Taipei Taiwan September 2011

52 Joseph Tulchin Argentina and the United States A Conflicted Relationship New York Macmillan 1990

53 Russell and Tokatlian lsquoBeyond Orthodoxyrsquo 54 According to the latest report of Latinobaro metro 52 of the Argentines consider Brazil as

the main leader of Latin America while only 2 gives that condition to the United States http wwwlatinobarometroorglatinoLATContenidosjsp accessed 23 November 2011

55 Osvaldo Rosales lsquoLa Republica Popular China y America Latina y el Caribe Hacia una nueva fase en el vınculo econo mico comercialrsquo 2011 ECLAC httpwwweclacorgpubl icacionesxml643666La_Republica_Popular _China_y_America_Latina_y_el_Caribe _ tradepdf accessed 10 November 2011

56 Eric Farnsworth 2011 lsquoThe New Mercantilism Chinarsquos Emerging Role in the Americasrsquo Current History February Available at httpwwwas coaorgarticles2982The_New_shyMercantilism_Chinas_Emerging_Role_in_the_Americas accessed 28 November 2011

Dow

nloa

ded

by [

FU B

erlin

] at

02

37 0

5 N

ovem

ber

2014

Journal of Iberian and Latin American Research 267

Appendix 1

Table 1

Argentinean trade with Brazil in millions of dollars 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Exports 6206 4828 4666 5587 6335 8141 10498 13272 11374 14420 Imports 5230 2517 4700 7567 10187 11749 14523 17687 11822 17658 Trade 975 2310 233 21980 23852 23608 24025 24415 2448 23238 balance

Argentinean trade with the United States in millions of dollars 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Exports 2840 2869 3364 3733 4493 4025 4153 5095 3465 3656 Imports 3737 1789 2238 3389 3998 4247 5264 6894 5106 6125 Trade 2897 1080 1126 344 495 2222 21111 21799 21641 22469 balance

Argentinean trade with China in millions of dollars 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Exports 1123 1092 2483 2628 3193 3476 5170 6355 3668 6117 Imports 1066 330 721 1402 2237 3122 5093 7104 4823 7678 Trade 56 762 1762 1227 956 354 77 2 749 2 1155 2 1561 balance

Source INDEC and UNCTAD

Table 2

FDI stock in Argentina by country of origin in millions of dollars (selected countries) 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

USA 16422 7476 7989 10277 11689 12208 13601 13930 14012 14814 of total 238 231 208 182 187 176 175 172 175 168

Brazil 1953 2108 3280 1773 2488 2810 3659 4969 4319 5367 of total 283 651 856 314 397 406 470 614 539 608

China no data no data no data 13 11 45 120 141 123 5500 of total no data no data no data 002 002 006 015 017 015 623

Total 68935 32403 38323 56554 62639 69292 77899 80941 80144 88249

for the years 2001 2002 and 2003 the data for Brazil includes all FDI from South America excluding ChileFrom 2003 onwards the data is exclusively for BrazilSource INDEC and UNCTAD

Table 3

Argentinean trade with the European Union in millions of dollars 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Exports 4698 5309 6079 6209 6844 8010 9901 13173 10278 11026 Imports 4717 2107 2814 4237 4830 5811 7442 9043 6434 7587 Trade 219 3201 3265 1972 2013 2199 2458 4130 3845 3439 balance

FDI from the European Union in Argentina in millions of dollars 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

FDI 38279 18284 21273 33001 36848 40408 45159 45070 44963 47605 of total 5553 5643 5551 5835 5883 5832 5797 5568 5610 5394 Total 68935 32403 38323 56554 62639 69292 77899 80941 80144 88249

Source INDEC and UNCTAD

Dow

nloa

ded

by [

FU B

erlin

] at

02

37 0

5 N

ovem

ber

2014

  • Abstract
  • The United States and Brazil Losing and Gaining Centrality
  • Relations with China (and Asia) A Historic and Challenging Opportunity
  • Looking Ahead
  • Notes
  • Appendix
Page 18: Implications of the Global and Regional Changes for Argentina's Foreign Relations

Journal of Iberian and Latin American Research 267

Appendix 1

Table 1

Argentinean trade with Brazil in millions of dollars 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Exports 6206 4828 4666 5587 6335 8141 10498 13272 11374 14420 Imports 5230 2517 4700 7567 10187 11749 14523 17687 11822 17658 Trade 975 2310 233 21980 23852 23608 24025 24415 2448 23238 balance

Argentinean trade with the United States in millions of dollars 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Exports 2840 2869 3364 3733 4493 4025 4153 5095 3465 3656 Imports 3737 1789 2238 3389 3998 4247 5264 6894 5106 6125 Trade 2897 1080 1126 344 495 2222 21111 21799 21641 22469 balance

Argentinean trade with China in millions of dollars 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Exports 1123 1092 2483 2628 3193 3476 5170 6355 3668 6117 Imports 1066 330 721 1402 2237 3122 5093 7104 4823 7678 Trade 56 762 1762 1227 956 354 77 2 749 2 1155 2 1561 balance

Source INDEC and UNCTAD

Table 2

FDI stock in Argentina by country of origin in millions of dollars (selected countries) 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

USA 16422 7476 7989 10277 11689 12208 13601 13930 14012 14814 of total 238 231 208 182 187 176 175 172 175 168

Brazil 1953 2108 3280 1773 2488 2810 3659 4969 4319 5367 of total 283 651 856 314 397 406 470 614 539 608

China no data no data no data 13 11 45 120 141 123 5500 of total no data no data no data 002 002 006 015 017 015 623

Total 68935 32403 38323 56554 62639 69292 77899 80941 80144 88249

for the years 2001 2002 and 2003 the data for Brazil includes all FDI from South America excluding ChileFrom 2003 onwards the data is exclusively for BrazilSource INDEC and UNCTAD

Table 3

Argentinean trade with the European Union in millions of dollars 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Exports 4698 5309 6079 6209 6844 8010 9901 13173 10278 11026 Imports 4717 2107 2814 4237 4830 5811 7442 9043 6434 7587 Trade 219 3201 3265 1972 2013 2199 2458 4130 3845 3439 balance

FDI from the European Union in Argentina in millions of dollars 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

FDI 38279 18284 21273 33001 36848 40408 45159 45070 44963 47605 of total 5553 5643 5551 5835 5883 5832 5797 5568 5610 5394 Total 68935 32403 38323 56554 62639 69292 77899 80941 80144 88249

Source INDEC and UNCTAD

Dow

nloa

ded

by [

FU B

erlin

] at

02

37 0

5 N

ovem

ber

2014

  • Abstract
  • The United States and Brazil Losing and Gaining Centrality
  • Relations with China (and Asia) A Historic and Challenging Opportunity
  • Looking Ahead
  • Notes
  • Appendix