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Latin America Is Quickly Becoming A Key Battleground For China And The United States



Latin America has become a battleground for the United States and China. At the surface is a dispute over natural resources that quickly moves into the grounds of geopolitics to determine spheres of regional influence. Argentina has emerged as a territory in flux, as a nation rich in some of the world’s most coveted commodities that seeks to keep some sort of balance between the two superpowers, looking to harness its export potential with a key geographical positioning that could grant China a foothold in region of key importance, the Southern Atlantic. With Argentina’s Economy Minister, Sergio Massa, leading a trade mission focused on the short-term need to shore up the government’s coffers—and a contended election charged with ideological extremes regarding the relationship with the US and China around the corner—an important chapter in how the relationship will evolve is currently being played out.

Massa’s mission is straightforward, and superficial. The Argentine government is currently cash strapped amidst a combination of exogenous shocks and unforced errors that has led to triple digit inflation and a situation of chronic and endemic economic fragility. In a country with a vast supply of “crown jewels” to put on the negotiating table, China appears as a potential, and necessary, savior. In play are the energy exports from Vaca Muerta, the world’s second largest shale field that is rapidly accelerating its production and exporting capacity, an incredibly productive agro-exporting sector, barely tapped lithium and copper production capacity, and even a burgeoning knowledge economy sector in serious need of foreign demand, to name a few. At the same time, US influence in Latin America—dubbed by some in the United States as its backyard, much to the distaste of the population—is strong. US companies have a large presence in the region, as does the State Department. The International Monetary Fund is a major player, particularly in Argentina, the recipient of the IMF’s largest ever bailout that is in constant political negotiation in order to avert another calamitous debt default.

As Argentine governments on the right and the left have banked on US political support in order to keep the IMF playing ball, under the assumption that it is in its interest to avoid another disruptive economic meltdown in the region’s third largest economy, Washington’s political influence in the Fund’s board has remained critical for the country. From Mauricio Macri to Alberto Fernández, Argentina’s last two presidents have relied on support from Donald Trump and Joe Biden to keep the country’s IMF program from floundering. And both of them have lent their support, looking to leverage the US’ interests in the region from their own perspectives. In Trump’s case the idea appears to have been to keep an anti-Kirchnerist government in power, aligned with his geopolitical vision while attempting to keep contenders like China at bay. But Macri lost the elections while still managing to retain a portion of power for his coalition, Juntos por el Cambio, which seems set to retake the seat of power. With regards to Biden, a certain affinity for a Peronist government that tries to paint itself as moderate, represented by an eclectic coalition named the Frente de Todos that includes anti-US factions, added to a pragmatic strategy that aims at securing stability in the region seems to have sufficed to garner his support.

Despite its economic fragility, Argentina has managed to maintain a certain equidistance between both superpowers. Both Macri and the Peronists courted Beijing and Washington. Geopolitical issues beyond purely economic reasons have seeped into the conversations including a Chinese telecommunications base in the Patagonia region, the potential acquisition of US defense equipment by the Argentine government, and the situation of the Malvinas and Southern Atlantic territories, under British control in what is a clear continuation of colonialist policies but justified by London after proving victorious in a brutal but short-lived war in 1982 whilst Argentina was under the rule of a military dictatorship. And that’s just to start.


A new set of conflicts is already underway. A port in the Southern province of Tierra del Fuego that will become one of the entry points to Antarctica and the Southern Atlantic could be financed by Chinese interests, while the potential use of Chinese 5G technology rattles the United States. Global food and energy security could make Argentina a key geopolitical player in the coming years. Already in possession of civil nuclear technology, the building of a new reactor in the country could steer it toward Chinese technology if the price is right. There are several issues in dispute at the moment which, added to Argentina’s own internal vicissitudes, could tilt the scales.

At the end of the day, and beyond a recent history of political ineptitude, Argentina could prove to be a key point of dispute between US and Chinese interests in the region and the broader geopolitical world.

Source: Fox Business

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