China and Argentina gets to controversial business

China and Argentina gets to controversial business

The presidential meeting will address the most sensitive issues that interest the communist regime in its penetration policy in Latin America. These include agreements for the construction of a nuclear power plant, the development of lithium investments, the control of airspace and the persistence of strong swap financing that could condition Argentina in the immediate future.

This is an ambitious agenda of China in Argentina, as is all the progress being made by the Xi Jinping in the region and which is of great concern to the United States and several countries of the European Union.


The Nuclear Power Plant in Zarate

Although in the agreements signed by Macri and Xi there is a broad list of good intentions and mutual wishes, the treaty that is most interesting to Beijing at the moment is the one that has to do with specifying as soon as possible the agreement for the construction of the nuclear power plant Atucha V in Argentina with completely Chinese technology and with the firm intention to start construction in 2022.

Argentine ambassador in China Diego Guelar declared that “China does not have speculative short-term operations, but, on the contrary, all of its projects in Argentina are long-term. Not only does he not worry about the economic storm of the short term but he continues to bet with total confidence in the future. ”

In practice, the project of Atucha V will imply for the Government that the nuclear power plant has at least 50% with Argentine technology and that all the workforce is local. That is, the production of enriched uranium in that plant is not subject to any future concession that a government makes in the coming years.

The Macri government reviewed the nuclear agreements, electrical energy for the construction of two dams and the airspace projects that came from the Cristina Kirchner stage. The diplomacy of both countries wants that on December 2 when Macri and XI  meet in Buenos Aires this all ready for the signing of the nuclear agreement and other projects to ratify the “integral strategic alliance” between both countries.

What will the Chinese communist regime demand in return?  For Irma Arguello, director of the Nonproliferation for Global Security Foundation (NPSGlobal), “China’s intention to gain ground in South America is clear, both from a strategic and commercial point of view.”

This was recently reflected in China’s recent agreements with Brazil and the acquisition of a part of Venezuela’s PDVSA oil company. China is the largest creditor of Venezuela with 28 Billion USD debt and the largest buyer of oil with 40% of Venezuelan exports. Arguello argues that given the inability to pay the Chavez regime, it is expected that in the short term there will be a transfer of assets to China.


For Ricardo Vanela, Strategy Specialist and Founder of the Argentine-American Network for Leadership (REAL) “it is clear that China seeks to secure natural resources, that is what Argentina has, as well as Venezuela. In the current scenario and especially in the very immediate future, natural resources are part of the most strategic capital that a country on this planet can count on. In that context, Argentina, I mean its leaders, must know exactly what it delivers and what it gets in return. And it must choose very clearly with whom it wishes to close transactions of high geopolitical impact “.


The space station in Neuquén

Another issue of the relationship of China and Argentina that makes a lot of noise is the installation of the space station of the Chinese in the town of Bajada del Agrio in Neuquén. It is an agreement signed by Cristina Kirchner for 50 years of tax exemption in an area of ​​200 hectares that since last April is completely managed by a Chinese agency that depends on the Chinese People’s Army.

Macri obtained an addendum to this agreement so that China clarifies that it is a space station of “peaceful use”. But the giant antenna installed by the Chinese in Neuquén begins to generate discomfort both from the United States and the European Union due to its eventual dual use and the potential possibility of intercepting satellites.

There was an informal request from Oscar Raúl Aguad to the National Space Activities Commission, regarding the agreement with China, so that there is greater control of Argentina on this project.

The Chinese embassy in Buenos Aires repeatedly denied that the Neuquén space station has a military use. “It is a space agency equal to the space station that has the European Union in Mendoza,” they say. However, there is one detail: that European agency does not depend on any army and is completely civil administration.


The telescope in San Juan

There is another project that also generates doubts in the diplomatic and military environment. The installation of a radio telescope from China in San Juan in agreement with the government of Sergio Uñac and the National University of San Juan. It is a CART radio telescope (Chinese Argentine Radiotelescope) located in the space center of Leoncito. The primary reflector is 40 m in diameter; the secondary reflector 4.2 m and there is an estimated civil works budget of $ 100 million pesos (USD 2.64 Million USD) plus the cost of the radio telescope and receivers for $ 240 million pesos (USD 6.35 Million USD).

Governor Uñac stressed that: “Science and technology are central areas for the government of San Juan thinking of a deep academic development for present and future generations.” Thus, he highlighted the innovative project that is carried out in the municipality of Calingasta with the fundamental contribution of China.


The dams in Santa Cruz

When Macri came to power in 2016 he had to review the contracts with China for the construction of two dams in Santa Cruz. Thus, power levels were reduced to power plants, warnings were raised about alleged cost overruns in the contracts signed by the former Minister of Planning Julio De Vido, and the amount of financing for the works was reduced.

Once again, as in the case of the changes imposed in the contract by the Neuquén space station, the Chinese accepted the addenda of new contracts for the dams, pragmatism prevailed and the Xi administration made it clear that it wants to set foot in the hydroelectric sector whatever the political cost that it has to assume.

The government also warned China that following the contract for dams with a company like Electroingeniería implied a problem since it was mentioned in the cause of bribes.

Iguacel asked the Chinese to let go of their partners Electroingeniería, Cordoba company whose vice president, Gerardo Ferreyra, along with its commercial director, Jorge Neira, are imprisoned and charged for the alleged payment of about USD 11 million in bribes.

Chinese state giant Gezhouba will be in charge of buying Electroingeniería and apparently there will be no demand of by means. Once again, the pragmatism of Communist China is imposed to fulfill its dream of landing fully in Latin America.

Source: Air de Santa Fe

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Arnaud Lefevre

Arnaud Lefevre is the Chief Executive Officer of Dynatom International. Arnaud is in charge of the international development of the business portfolio.