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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