China's Strategic Relationship With Argentina

Written by Nathan Matsko

Bellefonte-Argentina has announced that it will pay for Chinese imports with Chinese Yuan, rather than the US Dollar.

The move away from the Dollar is an attempt to preserve what little federal reserves the country has left amidst an economic crisis. Using the Yuan instead will encourage increased imports from China, as well as an increase in exports.

Argentina is in the middle of a dire economic struggle. Inflation in the South American country has reached 100 percent, plunging nearly 40 percent of its population below the poverty line. The situation is so out of control that the current president Alberto Fernandez has stated that he will not run for reelection when Argentina’s elections roll around come October.

China has invested heavily in Argentina in numerous sectors. In 2011, a deal was signed between the two nations allowing the purchase of nearly 500,000 acres of land by Chinese company Soya, nearly all of it being dedicated to soybean production to be shipped back to China. Reception from Argentinian nationals was mixed, with some worrying that the move would lead to food insecurity amongst its own people.

Another move that received some controversy was the construction of a massive satellite dish utilized by China’s space agency, which has been operational since 2018. Some skeptics believe that China is using the $50 million dish for signals intelligence purposes. While China and Argentina maintain that the agreement surrounding its construction was that it was to be used purely for civilian purposes, it is operated without any kind of oversight by the Argentinian government.

More recently, China has begun planning the construction of a new port and chemical plant in Argentina’s southernmost region. Though Argentinian officials have claimed the port to be “not feasible”, China seems adamant on its construction.

The port would grant China easy access to Antarctica, where China has four research stations, two of which are permanent. Other than research purposes, having a port so far south gives China several trade advantages, as well as near-unrestricted access to the South Atlantic, which has caused concern amongst environmentalists.

China has been accused of operating illegal and unregulated fishing vessels in the South Atlantic for years. Though it is not the only country to do so in this part of the Atlantic in particular, few have the capacity to fish at the rate China does. In 2021, it was estimated China had around 375 fishing vessels operating in the region.

Argentina regulates fishing activities for 200 miles off of its shores, but most vessels engaged in overfishing do so just outside of this zone. In doing so, Argentina has little power to stop them. It is also not uncommon for Chinese ships to “go dark”, or disable the tracking mechanisms used to log a ship’s movements.