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Cablegate: Argentine President Reprises Her Critique of U.S.

VZCZCXYZ0006
PP RUEHWEB

DE RUEHBU #1681/01 3461745
ZNR UUUUU ZZH
P 111745Z DEC 08 ZDK
FM AMEMBASSY BUENOS AIRES
TO RUEHC/SECSTATE WASHDC PRIORITY 2664
INFO RUCNMER/MERCOSUR COLLECTIVE
RUEHBO/AMEMBASSY BOGOTA 1828
RUEHCV/AMEMBASSY CARACAS 1909
RUEHPE/AMEMBASSY LIMA 2366
RUEHLO/AMEMBASSY LONDON 1293
RUEHME/AMEMBASSY MEXICO 1718
RUEHMO/AMEMBASSY MOSCOW 0775
RUEHFR/AMEMBASSY PARIS 1500
RUEHQT/AMEMBASSY QUITO 1123
RUEHSI/AMEMBASSY TBILISI 0008
RUEHBS/USEU BRUSSELS
RUEHRC/DEPT OF AGRICULTURE WASHINGTON DC
RUCPDOC/DEPT OF COMMERCE WASHINGTON DC
RUEHUNV/USMISSION UNVIE VIENNA 0211
RUEATRS/DEPT OF TREASURY WASHINGTON DC
RUCNDT/USMISSION USUN NEW YORK 0266
RHMFIUU/DEPT OF ENERGY WASHINGTON DC
RHEFDIA/DIA WASHINGTON DC
RUEKJCS/SECDEF WASHINGTON DC
RHMFIUU/HQ USSOUTHCOM MIAMI FL

UNCLAS BUENOS AIRES 001681

SENSITIVE, SIPDIS

E.O. 12958: N/A
TAGS: PREL PGOV ETRD PHUM ECON EAGR RU AR
SUBJECT: ARGENTINE PRESIDENT REPRISES HER CRITIQUE OF U.S.
"UNILATERALISM," BUT TRADE AND INVESTMENT OPPORTUNITIES ARE
THE PRIORITIES IN MOSCOW VISIT

REF: A. BUENOS AIRES 1456
B. BUENOS AIRES 1444

1. (SBU) Summary: Argentine President Fernandez de Kirchner
(CFK) indulged in an increasingly familiar critique of the
international system during a two-day visit to Russia
December 9-10, taking jabs implicitly at the U.S. and blaming
"unilateralism" for economic and security hardships in the
world. She framed the Argentina-Russia bilateral
relationship as instrumental toward a more equitable
multipolar system, while also emphasizing increasing
commercial and investment ties between the two countries.
CFK was accompanied by 80 businessmen and participated in a
large trade promotion conference on December 9. Business
deals on hydrocarbons and beef dominated the outcomes, along
with the apparently premature announcement of the elimination
of visa requirements for citizens traveling between the two
countries. The Argentine press noted CFK's implicit
criticism of the United States, and some reporters and
commentators raised sharp questions about the GOA's
quiescence on Russian human rights violations and foreign
policy actions. End Summary.

2. (U) President Cristina Fernandez de Kirchner (CFK) visited
Russia December 9-10, accompanied by Foreign Minister Jorge
Taiana, Planning Minister Julio De Vido, the head of the
newly created Ministry of Production, Debora Giorgi, and
Governors of the provinces of Mendoza and Santiago del
Estero. Press reports said that some 80 Argentine business
persons took part in the trip. CFK met with Russian Prime
Minister Vladimir Putin on December 9 and President Dmitri
Medvedev on the 10th, signing a joint declaration with the
President. The meeting with Putin was highlighted in the
Argentine press, which recalled that the then Russian
President had canceled a meeting with former Argentine
President Nestor Kirchner in 2004 when the latter arrived
several hours late. CFK, the press noted, had agreed to a
later start to her own meeting with Putin to accommodate the
funeral for deceased Russian patriarch Alexis II. Argentine
reporters were struck by Putin's "icy" and non-emotive
demeanor in the meeting.

Critiques of Unilateralism and the International System
--------------------------------------------- ----------

3. (U) In public remarks with Prime Minister Putin and then
after the meeting with Medvedev, CFK indulged in a critique
of the U.S.-dominated international financial system that has
become a common refrain since her September address to the
UNGA (reftel A). With Putin, she commented that "the return
of Russia to the international scene is for us good news. We
need a world that is not unipolar, something that has brought
us many headaches in terms of international security and
economic certainty." She thanked Russia for its support for
the Argentine position that the United Kingdom should agree
to negotiate over the future of the Malvinas (Falklands) via
the framework established by the United Nations. CFK also
voiced appreciation for a Russian decision to end visa
requirements for Argentines, a reference to a planned
bilateral visa waiver agreement that apparently could not be
concluded by the end of the meetings on December 10.

4. (U) After the Medvedev meeting on December 10, CFK said
that "the deepening of the relationship with Russia must be a
part of a new concept of international relations, both in
political and economic terms. Until now, relationships have
been marked by subordination. That is, the central countries
have imposed economic and security policies on the rest. We
have to substitute subordination for cooperation in state


relations," she said. "Russia and Argentina will be
protagonists in this different and better world." The global
economic system, she argued, had not worked and "now the
costs will be paid on a global scale." Underscoring her
critique, she said "there have been regulations imposed by
the IMF and by the UN, but they are only enforced on the
weaker and smaller countries and not on the powerful. It is
bad to live in a world without rules," she added, "but much
worse to live in a world where the rules apply only to the
weak." Although CFK did not name the United States in her
remarks, local press, including leading daily "La Nacion,"
interpreted them as being critical of U.S. policy.

5. (U) The December 10 communique reportedly also broadly
endorsed cooperation in the peaceful uses of nuclear energy,
space satellite navigation, and technical cooperation in
defense production. Despite continuing interest from the
Minister of Defense in purchasing Russian defense articles,
including possibly helicopters (reftel B), the anemic
resources for capital expenditures in the Argentine defense
budget apparently made this impossible.

GOA Sought Balance in Joint Declaration
---------------------------------------

6. (SBU) Rafael Grossi, the MFA's Director General for
Political Coordination and a close advisor to Foreign
Minister Taiana, told Poloff December 10 that his
negotiations with a Russian counterpart over the text of the
Joint Declaration had been long but not particularly
contentious. He called Argentine press stories that the GOA
had considered endorsing the actions of Russian security
forces in Georgia "absurd." Argentina had never considered
going beyond an endorsement of the EU-Russian statement
negotiated by French President Sarkozy, he said, and although
the Russians had initially proposed something more favorable
to their position on the Georgia conflict, they had accepted
quickly Argentina's limitations. Similarly, he said,
Argentina had refused to include language critical of U.S.
missile defense installations in Eastern Europe. Instead,
Grossi had suggested a more general point endorsing UN
consideration of a resolution to prevent an arms race in
outer space (but not, he emphasized, an endorsement of the
Russian-Chinese proposal on this issue). On other issues,
including human rights, UN Security Council reform, and
terrorism, the two sides had generally resolved differences
by reverting to broad endorsements of UN resolutions on these
issues.

7. (SBU) Grossi suggested that Washington view the joint
communique and the visit as a balanced endeavor, that in "no
way should be portrayed as anti-American." The Argentine
press, he said, seemed to be trying to score points against
the CFK administration by playing up the anti-American angle.
Grossi emphasized that he was a career diplomat and that his
reaction to the press critique was not that of a politician.
The visit's principal goals, Grossi emphasized, were
economic. First "to secure an important market for Argentina
-- just like everyone else is doing during a global economic
crisis," and second, "to advance important opportunities for
cooperation on oil and gas."

Quiet on Human Rights
---------------------

8. (U) Lead "La Nacion" columnist Joaquin Morales Sola, in a
front-page placement December 10, sharply questioned CFK's
silence on human rights issues during her visit to Russia,
contrasting this quiescence with her heavy implicit criticism
of the United States. He also wondered at the focus on
attracting investment, coming after former President and now
presidential husband Nestor Kirchner had "spent the past five
years frightening them." Like other pundits, he suggested
that the Kirchner's were attracted to the authoritarian
elements of Russian rule.

Building on Commercial Ties: Oil and Beef Dominate
--------------------------------------------- -----

9. (U) Although CFK emphasized that the Argentina-Russia
bilateral relationship should not be "characterized only by
commerce," trade and investment were central to the visit.
Perhaps most prominently, Russian private oil company Lukoil
signed an accord with the GOA to invest up to USD 500 million
in Argentina, beginning with a fuel storage facility north of
Buenos Aires city and a pipeline to connect it to the nearby
General Belgrano thermoelectric plant. This has been a GOA
priority project, needed to expand domestic power generation
capacity. The plant began operating on diesel fuel in early
2008. Planning Minister De Vido, who signed the accord for
the GOA, stated to the press that "the idea is for Lukoil to
become a major player in the energy area" for Argentina.

10. (U) Foreign Minister Taiana announced that Russian Prime
Minister Putin asked CFK to allow GOR-owned Gazprom to
participate in future construction of an extension of the
natural gas pipeline network to cover Northeastern Argentina.
According to Taiana, Putin also expressed interest that
another Russian state-owned energy company, Rosneft,
undertake future exploration off the Argentine coast.

11. (U) Discussion of beef exports dominated the Argentine
press focus on trade issues, as CFK stated that McDonald's of
Russia had nearly closed a deal to import 355 metric tons of
beef per year (equal to 3.7 percent of 2007 Argentine beef
exports to Russia). Sergei Malikov, trade director of
Russian meat importer City Grand, told local press that meat
purchases from Argentina were lower than they could be
because "not all of the Argentine firms have export licenses"
for beef, a result of ongoing GOA limits on beef exports.
While fruit exports to Russia had been growing steadily, meat
exports to Russia fell 45 percent in 2007 from 2006 totals,
largely due to GOA-imposed beef export constraints.

12. (U) Argentine exports to Russia are over 90 percent
agricultural in origin, led in 2007 by USD 252 million in
meat (mostly frozen beef) and USD 203 million of fruit (led
by apples, pears and citrus), out of total exports of USD 784
million. For the first three quarters of 2008, however,
Argentine fruit exports had outpaced beef and total exports
had reached USD 825 million.

13. (U) Total goods trade between Argentina and Russia was
USD 1.15 billion in 2007, an increase of 291 percent from
2003, with exports from Argentina of USD 784 million and
imports of USD 430 million. Both exports to and imports from
Russia have grown faster in that period than Argentina's
overall trade flows, and Russia's share of Argentine trade
has climbed from 0.7 percent in 2003 to 1.2 percent in 2007
and 1.5 percent through the first three quarters of 2008.
Argentina's imports from Russia are dominated by fertilizer,
which at USD 332 million in 2007 was 77 percent of all
imports from Russia. Through September 2008 that figure had
increased to USD 506 million, accounting for 30 percent of
Argentina's fertilizer imports.

Comment
-------

14. (SBU) Argentina has enjoyed warm relations with Russia
since the nineteenth century. That the Kirchner
administration sees value in building both commercial and
strategic ties with Russia is not surprising, nor is it
difficult to understand the attraction the Kirchners might
feel for Russia's economic model of heavy state ownership and
intervention in the economy. Argentina has moved in that
direction, complicating relations with private capital in the
process. State corporations like Russia's oil giants might
appear increasingly appealing to the GOA as private capital
grows wary of energy sector and other investments in the
country.
WAYNE

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