Sergio Massa has raised $1 billion in China, but funds to expand the pipeline are in doubt

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June 15. Chinese President Xi Jinping turns 70 and, as a football fan, is likely to celebrate at Beijing’s Workers’ Stadium with the friendly between the Argentina national team and its idol Leo Messi facing Australia.

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The choice of the match date was not accidental among the different options that Argentina is experimenting with in his desperate search for dollars. It could be called the “football diplomacy”, which seeks to initiate loans to strengthen reserves and for key investments that are granted to a government that will change in a few months.

In the brand new presidential plane that brought a large entourage in which it stands out Maximus Kirchner and who added more likes YPF President Pablo González, there were several books about China.

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The 29-hour flight and two stopovers on a plane that still doesn’t have Wi-Fi installed encouraged officials led by Sergio Massa to review the Memoirs of Henry Kissinger on ping-pong diplomacy with China.

Sergio Massa and a representative of the Rete di Stato company, which will invest in electric transport.  Photo Ministry of Economy

Sergio Massa and a representative of the Rete di Stato company, which will invest in electric transport. Photo Ministry of Economy

This afternoon in Shanghai, Sergio Massa, accompanied by Máximo Kirchner and the energy team made up of Flavia Royón and Agustín Gerez, met the Gezhouba dam and signed an immediate disbursement commitment for the work of US$ 524 million, as well as the acquisition of two Aysa plants, a wastewater treatment plant, for $70 million.

The round continued with Status Gridwhich funds high-voltage lines for transporting and distributing electricity known as AMBA 1 and impacts 1.2 million people, as well as consuming $300 million.

In total, it could be said that on the first day of his visit to China, Sergio Massa raised $1 billion, which shortly, by 1 July at the latest, they will enter the reserves of the Central Bank.

Sergio Massa in China with another of the companies he met with.

Sergio Massa in China with another of the companies he met with.

But in terms of funding for the expansion of the Néstor Kirchner gas pipeline, the result has been elusive. Massa planned to request $2.8 billion from Chinese banks, Something happened that it has now decided to hold a tender in which Chinese companies will also participate. This tender not only provides for the financing of a 562-kilometre work that must be completed in 10 months. They will also include the purchase of the pipes and the entire work.

“It is important to agree on issues that are useful for the present and above all for the future,” Massa said in a brief meeting with journalists. The delegation that came from Buenos Aires divided up the work, not only to face various fronts, but also to face a task that is not easy to guess in the face of an unpredictable Argentina. When some members of the delegation were asked what the Chinese were worried about, the answers were rather elusive.

The President of the Central Bank, Miguel Pesce is negotiating the renewal of exchangesthat exchange of currencies for the equivalent of 18,000 million dollars which expires in August and which Massa wants to bring forward to bring some peace of mind.

With international rates rising, these loans are now 25% less compared to those obtained at the level of the Monetary Fund. But the goal is ambitious because Massa intends it too expand a line of the current 5,000 million to 8,000 million dollars within the package of 18,000 million can actively intervene in the event of exchange rate volatility.

Pesce works on this task with Marco Lavagna, and Massa will meet this Thursday with Dilma Rousseff, the new president of the BRICS bank that brings together Brazil, Russia, India, China and South Africa.

This meeting is essential because what Massa wants is for that bank to also provide him with an agreement to strengthen the central bank’s reserves and thus calmly arrive at least until the August PASO.

The problem is that the bank has a specific article, article 7, with which cannot lend to third countries. Argentina is on the way to becoming one, but it is a process that will take several months. Massa and the economic team found a shortcut, consists of that Brazil raise its capital so that from that money can be lent to Argentina. Will Dilma do it?

The presence of Máximo Kirchner can be read in this delegation as Cristina’s support for the administration of the Minister of Economy in a relationship that began to forge with the vice president’s son in 2018 in Congress. Near Masa they say so there is affection for societatis.

Another assistance much appreciated by the Chinese is that of Cecilia Moreau, president of the Chamber of Deputies, and it is in the sense of a bureaucracy that respects legislative offices and which has its own National Assembly as a decision-making body. Near Massa they say that he brought her to help him in the difficult labors he must undertake.

The Secretary of Agriculture also came to realize that open up the market for bovine offal. Argentina is already the main exporter of chicken claws and a project to establish small pig farms in some provinces such as Chaco is still on the agenda.

But, judging by diplomatic sources, the Chinese were not fooled by the promises and went for it very specific projects as in the case of dams. Added to this is the expansion of the Cauchari solar park in Jujuy, followed by the electrification of some railway branches such as the Roca and San Martín and, above all, a work that remained pending in the Belgrano Cargas.

The greatest interest is lithium. And, moreover, Argentina is trying to facilitate the arrival of Chinese tourism with various efforts. Peru succeeded and tripled the figure taking advantage of a market of 500 million middle and upper class consumers who has decided to go out into the world.

But meanwhile, at every meeting they have, the Chinese don’t ask about inflation: the concern is getting tickets for the national team match on June 15thIt is a task that haunts the Argentine ambassador, Sabino Vaca Narvaja. each entrance it costs $1,500.


Source: Clarin

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