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China-Argentina cooperation set to grow and prosper

By Azhar Azam | chinadaily.com.cn | Updated: 2022-03-15 09:34


China's emergence as a world leader in solar, wind, hydroelectric and geothermal power generation makes it a natural Argentina ally. Over the years, the country's government and corporations have attracted Chinese investment and finance into renewable and other types of energy sectors to accelerate Buenos Aires' sustainable economic development and hybrid pathway.

With Chinese investments and technological assistance, Argentina had built one of Latin America's largest solar energy plants, Cauchari Solar Park, in Jujuy. The world's highest altitude facility provided power to 160,000 families and turned into a poverty alleviation and social welfare effort when it hired local residents after providing technical training, and was projected to generate $400 million in net profits for the province, widening fiscal space for establishing new schools.

Beijing's comprehensive strategic partnerships with Argentina and other regional states, mostly in the energy sector and infrastructure development, as well as the induction of 21 Latin American countries into BRI, however, are unsettling lawmakers in Washington. Skepticism about China's growing economic relationship with the region has been aggravated by Donald Trump's antipathy toward China's economic and technological rise and is being continued by US President Joe Biden's spendthrift policy.

In December, US Congress completed action on the National Defense Authorization Act, creating a provision for a report by June 30 on Chinese efforts to expand "presence and influence" in LAC. Wary of Chinese infrastructure investments in the region, the US House and Senate in June 2021 and February 2022 approved broad bills to compete with China worldwide and bolster America's economic competitiveness to regain US dominance in LAC.

Citing so-called national security threats, US legislators even introduced a bipartisan bill, "Western Hemisphere Security Strategy Act of 2022," to undermine the China-LAC relationship. But concerns about alleged China's expanding security footprint in LAC are being snubbed by regional academics who dub the claim a "rich-world problem." What's more, the regional countries don't see Chinese investments in Argentina as a "zero-sum game".

Argentina itself has been keenly interested in expanding currency cooperation and becoming part of the BRI family. The "strategic decision" of joining the Chinese intercontinental project and extension of "monetary swap", an Argentinean official said, will guarantee finances or investments of more than $23.7 billion and bolster the dwindling forex reserves.

The bilateral consensuses reached between Chinese and Argentinean leadership at a Beijing summit, as the two countries celebrate the 50th anniversary of diplomatic ties this year, should set the stage for collaboration in trade, infrastructure, anti-pandemic cooperation, digital economy and green development as well as taking the diplomatic and political relationship to new heights.

President Alberto Fernandez's move will further help Argentina "diversify the range and possible destinations" of its exports to China and other BRI countries. After years of diplomatic neglect, the Biden administration last year mooted Build Back Better World in LAC. Yet Buenos Aires, holding the high diplomatic status of "strategic integral alliance" from Beijing, threw its weight behind BRI.

Argentina's affiliation with BRI would expand energy deals between the two countries, boosting the former's wind and solar sectors. It additionally offers an opportunity for the South American economy to make its pie bigger in China-Latin America trade, which has risen to $451 billion at a staggering increase of more than 40% in 2021.

Experts called for greater cooperation between China and Argentina on transmission infrastructure. While Beijing plans to modernize some of the country's outdated transmission infrastructure as Buenos Aires is in talks with Chinese firms, these investments and other infrastructure projects will likely increase under BRI to boost Argentina's socio-economic development.

Argentina's decision to accede to BRI is its legitimate and sovereign right and shouldn't be used as a tool for the US to undermine the cooperation. Integration of LAC's third-largest economy into the trillion-dollar roster doesn't challenge or pose a threat to any doctrine or American security. This bullying and assertiveness, to impede cooperation between two sides or impede growth of either of the two, cannot survive in a free and multilateral world and must be ceased.

Azhar Azam works in a private organization as "Market & Business Analyst" and writes on geopolitical issues and regional conflicts.

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