Tag Archive for: Infrastructure Financing

On March 2-3, the conference on foreign investment and the New Silk Road in Latin America and the Caribbean was held on the campus of the National University of San Martín in Buenos Aires.

“Below, we offer a google translate version of the original article in Spanish. This translation may not be accurate but serves as a general presentation of the article. For more accurate information, please switch to the Spanish version of the website. In addition, feel free to directly contact in English the person mentioned at the bottom of this article with regards to this topic”.

On March 2 and 3, the conference ‘Rethinking the role of foreign investment and the New Silk Road in Latin America and the Caribbean‘ organized by Transnational was held on the campus of the National University of San Martín (UNSAM). Institute (TNI) and UNSAM.

Both days, exponents participated not only from Argentina, but also the presence of specialists from Chile, Bolivia, Brazil, Mexico and Peru. On the first day of the conference, issues such as the role of foreign direct investment (FDI) for sustainable development in the current context of climate crisis were addressed; FDI in Latin America, including Chinese investments and the key sectors in which they are located. In addition, the potential implications of the region for the New Silk Road were discussed.

As the main conclusions of the first day, we can mention China’s need for extractive primary resources, the main reason for its relationship with Latin America and the Caribbean. The transfer of Foreign Direct Investment (FDI) of environmental impacts to the countries of the region. Finally, the continued violation of Chinese investments to Convention 169 of the International Labor Organization (ILO) on the right to free, prior and informed consultation for indigenous peoples.

On the other hand, on the second day there was a greater exchange of opinions between the speakers and the public present, respecting the topics agreed in the Program, such as Chinese FDI in the region, specifically the characteristics, impacts and challenges they face. Latin American countries, with emphasis on Argentina, Brazil, Mexico, Bolivia and Chile. Lastly, the topics that generated the greatest exchange of opinions were the relationship FDI-sustainable development models and, on the other hand, what is the type of FDI that we want, that is, if it can contribute to national development taking into account ecological sustainability .

Regarding the second day, the questions that had great force were those regarding which pattern China follows in the different countries of the region. Thus, issues such as the growing demand for lithium by China, its association with companies from other states to obtain their technology (technology transfer), the expansion of bi-oceanic projects, hydroelectric dam projects and the increase in ecoterritorial conflicts, due to mention some.

In our region, in recent decades, Chinese investments have grown exponentially, exceeding investments by traditional multilateral organizations (such as the World Bank and IDB). With these investments comes the lack of controls, environmental and social impacts, and human rights violations. However, the asymmetric relationship that exists between the region and the Asian country cannot be overlooked, reproducing the classic unequal patterns of relationships that have characterized Latin America and the Caribbean, formerly with the United States and Europe, now with the People’s Republic from China.

Consequently, it is important to create greater articulation between civil society, academia, affected communities and all those interested parties to demand a more egalitarian form of relationship and compliance with environmental and social standards, absent so far. It is within this framework that our participation in the conference and Fundeps’ interest in strengthening ties with both national and international academic institutions that address the issue of Chinese investment and its impact on the environment and human rights are framed.

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Author

  • Sofia Brocanelli

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This working document addresses one of the new multilateral development banks: the New Development Bank (NDB) of the BRICS. It develops its beginnings, structure, policies and strategies, the projects it has underway and the role that China has in the Bank.

With the law 27,328 approved in 2017 on the modality of Private Public Participation contract, the previous Argentine Government intended, among other objectives, to reduce the country’s infrastructure deficit, while leveraging private investment. After having confirmed only a handful of projects of those initially raised, and taking into account the criticisms existing in other countries and regions regarding this type of contracting, the question that arises is how effective this contracting modality has been so far , and what decision the new Government will make regarding the continuity or not of both the confirmed and pending projects; as of the decision to promote PPPs to boost infrastructure in the country.

“Below, we offer a google translate version of the original article in Spanish. This translation may not be accurate but serves as a general presentation of the article. For more accurate information, please switch to the Spanish version of the website. In addition, feel free to directly contact in English the person mentioned at the bottom of this article with regards to this topic”.

The contract modality of Public Private Partnerships (PPPs) or Public Private Participation (PPP) are medium or long term agreements between the State and a private sector company. PPPs apply to projects related to public infrastructure and the provision of social services that have a deficit in their financing. Therefore, together with private and governmental agents, it participates in the provision of services such as water, transportation, road infrastructure, energy, among others. (More information about APPs)

The need for capital, technology and resources has been and is necessary in our country due to the deficit that exists in infrastructure. Therefore, the PPP contract modality has been presented as an alternative to end or reduce this imbalance. Since 2000, Argentina has a legal framework that regulates PPPs, one is Decree No. 1299 of year 2000 and the other is Decree No. 967 of year 2005. However, due to changes in the international economy , these instruments were obsolete, so in 2017 a new law was approved that regulates the application of the PPP, Law No. 27,328 and its Decree 118/2017. The difference between this instrument and the previous ones is that the current one excludes or limits the prerogatives of public law of the Administration as the ability to unilaterally modify the contract, making it impossible for the private contractor to invoke the breach of the State to suspend its benefits, among others.

The Subsecretariat of PPP is the body responsible for regulating this type of contract modality. This unit, before the assumption of the current government, was in charge of 5 National Directorates: the Executive Coordination of PPP Projects, Energy and Mining Projects, Transport Projects, Communications and Technology, Water Projects, Sanitation and Housing, and Health, Justice and Education. Currently, on the occasion of the change of government, modifications are being made in this unit. So now, the PPP Subsecretariat is responsible for 3 national directorates: the National Directorate of Information and Monitoring of PPP Projects, the National Directorate of Technical Evaluation of PPP Projects and the National Directorate of Legal and Regulatory Project Analysis of PPP.

It is important to mention that the High Level Reporting Mechanism (MRAN) was also implemented in the PPP Tenders that collaborates with the Anti-Corruption Office. This mechanism is a tool for preventing corruption and / or committing ethical irregularities. It aims to provide private sector companies and other parties that are participating in the bidding process, a reliable, specific channel known to all to report alert situations such as unethical behavior and offer of bribes.

As for the projects, once the law entered into force, an Argentine Government Plan was presented that contemplated the completion of 60 PPP projects between 2018-2022 for USD 26 billion. In this framework, from Fundeps, requests for information have been made to the national State to consult for more information on this type of contract such as the organizational structure that guarantees it, the entities responsible for monitoring, and what are the projects that are in March and in what sectors.

One of the largest projects currently being developed is the ‘Highway Network and Safe Routes PPP- Stage 1’ which began in June 2018, being awarded to National and International Public Tenders for the contracting of the design, construction, expansion, improvement, repair, remodeling, operation, maintenance and commercial exploitation of different National Road Corridors. Just to mention, this process had the participation of 10 consortia composed of 19 national and 7 international companies that submitted 32 offers in total.

However, when asked about the participation in this type of projects of any of the international financial institutions such as the IDB, IDB Invest or World Bank, from Nation they could not provide us with such information, despite the fact that they exist on the websites of said projects institutions, information linked to the realization of works with this type of modality.

Undoubtedly, the short period of validity of the new regime, as well as its poor implementation in only a handful of projects to date, added to the context of the economic crisis that the country has experienced in recent years, make it impossible to do an accurate balance of how effective or not this contracting modality has been to achieve the objectives set.

With the new government, it will be necessary to follow up on the projects that are underway and observe what position it will take according to the projects that are still to begin, since the package of projects covers from the year 2018 to 2022. In turn, It is worth considering whether the new government will follow in the footsteps of its predecessor, seeking to promote this type of contracting modality to carry out infrastructure works and attract private investment or if, on the contrary, it will resort to either more traditional options that are based on strong participation and financing of the public sector; or rethinking the APP mode in some way.

Regardless of this, and already having legislation that allows this type of contracting modality, from Fundeps we consider it a priority that, when thinking and promoting this type of projects, the problems and deficits that have had in the past are taken into account and they currently have PPPs in other countries of the region and the world. Problems that are widely documented and that can serve as lessons learned to avoid damages and enhance the benefits of this contracting modality to strengthen national infrastructure.

* The information provided has been modified according to the website of the Head of Cabinet where the new government management has modified the number of national addresses. It is important to clarify that they are still updating the contents of the site according to Decree 7/2019.

Authors

Sofia Brocanelli

Gonzalo Roza

Contact

Gonzalo Roza, gon.roza@fundeps.org

The article proposes an approach to financing the Silk Road and the Silk Road Initiative,
trying to analyze the extent to which the recently created Asian Infrastructure Investment
Bank (AIIB) plays as a "financial engine" of the Initiative, It represents (or not) an
opportunity for the objective of greater environmental and social sustainability in the
infrastructure projects carried out within the framework of the “New Green Silk Road”.

The First Integrated Five-Year Plan signed between Argentina and China for Infrastructure Cooperation (2017-2021) contains 16 projects to be developed in the country. Within these are the construction of two nuclear power plants. The choice of building nuclear plants, instead of investing in wind and solar energy, raises certain concerns about the risks of nuclear energy.

“Below, we offer a google translate version of the original article in Spanish. This translation may not be accurate but serves as a general presentation of the article. For more accurate information, please switch to the Spanish version of the website. In addition, feel free to directly contact in English the person mentioned at the bottom of this article with regards to this topic”.

The strengthening of the Sino-Argentine relationship was observed with the signing of the First Five-Year Plan (2017-2021) between the two actors, which includes 16 projects to be carried out in the country with Chinese financing. One of the projects that generates economic, but above all environmental, questions is the construction of two nuclear power plants, Atucha III and IV.

Around nuclear power plants there are opinions for and against. There are defenders of this type of energy due to low emissions, however, there is an increasing number of opponents of nuclear energy due to its impacts on the environment, the risk it means and how expensive it is in relation to wind and solar energy .

Our country has three nuclear reactors, the first, Atucha I, was built in 1974; the second plant is that of Embalse that began operating in 1984 and the third plant was Atucha II, which began operating in the national system as of 2014. Nuclear-type energy represents 6% of the country’s energy. Energy Matrix.

The agreement for the construction of two nuclear power plants dates from the government of Cristina Kirchner, who agreed to build with China in 2015. When Macri took over as president, the effectiveness of this type of energy was questioned, however it was ratified the agreement with China on the construction of nuclear power plants (Atucha III and IV). Despite this, due to the economic crisis that the country is going through, the government had to choose to build a single plant so that the size of the loan is not so large and the country can face it.

Thus, the Atucha III nuclear power plant will be built, which will add 745 megawatts to the network and will be located in the town of Lima, Province of Buenos Aires. The contract for the construction of this plant includes a loan from China for $ 10 billion, which covers 85% of construction costs; the rest will be invested by Argentina.

Initially, when the agreement was signed, the governments of both countries expressed the importance of signing the contracts before September 2017, and, consequently, begin the construction of one of the plants that same year and the second in 2019. However, none of these events happened.

This Five-Year Plan aims to increase complementarity, cooperation and benefits in the infrastructure sector, contributing to the development of bilateral economic relations and the nations of both countries.

Chinese financing has grown markedly in Latin America and the Caribbean, and Argentina has not been the exception to this growth. Relations between the two countries have evolved in such a way that China is important as a bilateral lender, where the largest amount of loans has been allocated to infrastructure and energy projects.

From Fundeps a request for information was made at the beginning of the year to the National government for the First Five-Year Plan between China and Argentina, emphasizing the construction of nuclear power plants. The main questions that were consulted were about the modalities and characteristics of the financing that the Argentine government agreed to finance the works contemplated in the First Five-Year Plan; the dependencies, officials and other actors involved.

Regarding the construction of nuclear power plants, a topic of relevance in the request for information, the state of construction of nuclear power plants was requested, what have been the social and environmental guidelines of the institutions involved in the project, which were the preselected and selected places to carry out the construction, the studies that were carried out to select the place of construction of the plants and, if there has been an environmental impact assessment (EIA) as if there were instances of citizen participation.

Although the request was answered late (July), the questions asked to the Ministry of Energy and the Ministry of Finance were not effectively answered. Just to mention some questions of the response to the request, the EIA documents were not provided, much less the studies carried out to select Lima, (province of Buenos Aires) as the place for the construction of the nuclear power plant. In general, the answers to the questions asked were brief, and most, if not all, did not provide the data requested by Fundeps.

In terms of access to information at the national level, progress has been made, as citizens can request information through the web. However, much work remains to be done in the field of open government, since the answers to the requests for information elude the root of the question being asked. Not much information is available and, neither, when requesting the responsible entities, the information that is required is obtained.

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Author

Gonzalo Roza

Contact

gon.roza@fundeps.org

On August 23, Fundeps participated in the ALADAA National Congress within the framework of the Global Governance area agenda on Chinese investments in Latin America.

Below, we offer a google translate version of the original article in Spanish. This translation may not be accurate but serves as a general presentation of the article. For more accurate information, please switch to the Spanish version of the website. In addition, feel free to directly contact in English the person mentioned at the bottom of this article with regards to this topic.

On August 22 and 23, 2019, the IX National Congress of ALADAA (Latin American Studies Association of Asia and Africa) Argentina “Cultures in Motion: Potentials and Challenges in Globalization. Asia and Africa from Latin America” was held in the city of Río Cuarto. Fundeps participated by presenting a paper entitled “The role of the Asian Infrastructure Investment Bank (AIIB) in the New Green Silk Road”, which was presented by the Global Governance area volunteer, Mariano Camoletto.

The article deals with the financing of the Silk Road and the Silk Road Initiative, analyzing the role of the AIIB as its financial engine. In addition, it explores whether financing through the AIIB represents a possibility of providing greater environmental and social sustainability to the projects implemented in the framework of the New Silk Road (also known as the Belt and Road Initiative), the mega project on a global scale driven by China.

The AIIB, whose headquarters is in Beijing, was created in 2015 on the initiative of China and currently has more than 100 members, among which Argentina. The bank aims to contribute to the economic and social development of Asia with a focus on sustainable infrastructure, private capital mobilization and connectivity. For its fulfillment, the AIIB has a portfolio of 100 billion dollars and the strategy is based on the Lean, Clean and Green concept through which the bank seeks to be efficient, agile, ethical and environmentally friendly.

As for the bank’s operational policies, the most important are the Environmental and Social Framework and the Accountability Mechanism. As for the first, it was approved in 2016 and its purpose is to help the bank and its clients achieve positive results of environmental and socially sustainable development in their projects, as well as expose the institutional objectives to address environmental and social risks and impacts in the projects financed by the bank. Likewise, compliance with these policies is mandatory in order to access bank financing.

As for the Bank’s Accountability Mechanism, it was launched in 2018 and is intended to receive complaints and requests from those communities or populations negatively affected by Bank-financed projects. The mechanism has two essential functions: the first one is the resolution of disputes through dialogue and understanding of the affected parties; and secondly, that of compliance review, which consists in this mechanism investigating whether the Bank has fulfilled its obligations regarding the proper application of its operational policies.

The main objective of our participation as exhibitors in this congress was to promote the foundation’s approach to the national and provincial academic community for the study of Chinese investments and initiatives (such as the AIIB) and its impact on society, which is usually reflected in infrastructure projects with potential (or real) environmental and social impacts. The joint work has the purpose of analyzing and understanding China’s socio-political and economic insertion model in Latin America and, especially, in Argentina; as well as the strategies that Latin American countries implement against this phenomenon in the framework of the Silk Road.

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Author
Mariano Camoletto

Contact
Gonzalo Roza, gon.roza@fundeps.org

On August 21, we made requests for information on the finished work of the trunk pipelines of the province of Córdoba to different units of the province of Córdoba.

On the occasion of the completion, in the course of 2019, of the work of trunk pipelines that began to be planned more than ten years ago, we made requests for information to the Córdoba Investment and Financing Agency (ACIF), the Ministry of Water, Environment and Public Services and the Ministry of Public Works and Financing.

With this work, according to the government of the province, the gas network reached almost 98% of Cordoba, however, there are a number of issues around the project that are not yet fully clarified.

Despite being completed, issues such as the lack of access to information on the control of the progress of the project, such as the lack of precision about the funders of each of the systems has been controversial and confusing. Although it could be observed that the communication on the progress in the work by the provincial government was constant, the same did not happen with access to more specific and sensitive issues related to the project.

From Fundeps we have carried out periodic monitoring and monitoring of the project, even though the official information has been scarce and difficult to access: requests for information we previously made were never answered. With these new requests made we hope that the modalities in the access of provincial information have been modified in a positive way in order to achieve a more transparent and open government to society.

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Author

Sofia Brocanelli

Contact

Gonzalo Roza, gon.roza@fundeps.org

In January 2019, and after more than 10 years since the project began to be planned, the Government of the Province of Córdoba terminated the works of the trunk gas pipelines. Despite the obvious benefits of the project, it is worth asking about the true balance left by the experience of this project, especially in terms of transparency and accountability in public policies.

“Below, we offer a google translate version of the original article in Spanish. This translation may not be accurate but serves as a general presentation of the article. For more accurate information, please switch to the Spanish version of the website. In addition, feel free to directly contact in English the person mentioned at the bottom of this article with regards to this topic”.

At the beginning of 2019, with the authorization of the last supply branch and the pressure regulating plant in Tala Cañada (Pocho), the Government of the province of Córdoba concluded the controversial project for the construction of the trunk pipeline network. According to the government, the gas network thus reached almost 98% of Cordoba people; Although it is clear that the vast majority of industries and neighbors benefiting from the work do not yet have effective access to the service, since the problem of connecting to home and internal networks remains to be resolved.

With the work completed, the axis then moved to the need to connect the backbone networks with the home networks, so that families and businesses can effectively access the benefit. The company Ecogas and the municipalities are responsible for bringing the gas network to private homes, for which they will receive financial support from the province. While the Bank of Córdoba made available a line of credit -Dale Gas! – at zero interest rate and with a return of 48 months for the home gas installation; The provincial government launched a financing plan so that companies can connect to the network. This plan called «Connect Gas Industry» contains three lines of credit for businesses, SMEs, industrial parks, CNG stations and tourist establishments.

A controversial work

This work, according to data handled by the provincial government, benefits 973,490 Cordoba in 228 locations. Some populations will receive natural gas for the first time and, in other locations, the service will reinforce the existing one. However, despite the obvious benefits of the work, the project of gasification of towns in the interior of the province of Córdoba has been the focus of various controversies and has been under the watchful eye of public opinion since its inception. Thus, for example, as regards the financing of the work, the reasons for the fall in financing of both BNDES at first, and of Chinese banks later, were never officially clarified; and the provincial government’s decision to move forward with the work using public indebtedness generated controversy.

Similarly, the lack of access to information to control the progress of the project has been a constant throughout the entire execution process. Additionally, the project has been investigated for alleged acts of corruption in the bidding of the sections to be built, even being mentioned in the Lava Jato case in Brazil from the participation of the Odebrecht company in the works.

Thus, for example, in February 2018, the legislators of the opposition to the provincial Government, Juan Pablo Quinteros, Aurelio García Elorrio and Liliana Montero, filed a complaint with the Financial Information Unit (FIU) regarding the possible payment of charges for the work of the trunk pipelines. This follows from the kidnapping of the list of coimas paid to different governments of the continent belonging to the Brazilian banker Alberto Youssef, where he names at least four times the work in question. This list served as a tool for Brazilian investigators of the Lava Jato cause to prove the existence of a public works club made up of Odebrecht, Andrade Gutiérrez, OAS, Camargo Correa and other construction companies. According to the complainants, a 36 million dollar premium would have been paid. Also, they argue that the collection was made through the session of a real estate project in Puerto Madero (Buenos Aires) to a company of the Horacio Miró group, former official of the administration of José Manuel de la Sota. This accusation was denied by the businessmen involved.

In mid-2018, the possibility that Argentina will reach an agreement with Brazil so that Argentine judges can access the information present in the Lava Jato investigation generated great expectations in Córdoba. The causes for alleged corruption offenses in public works in our country would have the possibility to move forward through the use of this information. This agreement generated expectation given the denunciation for the alleged payment of coimates for 36 million dollars to the company of the Horacio Miró group. In this regard, the administrations of the former governor of La Sota and the current one, Juan Schiaretti, denied all kinds of accusations. This complaint is currently under the responsibility of Prosecutor 1 of the Anti-Corruption jurisdiction, which is based on data provided by Brazil.

However, the scandal caused by the irruption of the cause of the notebooks in August 2018 hit several of the companies involved in the construction of the trunk pipelines. From the provincial government they clarified that all tenders were carried out transparently. Among the companies involved and that have works in progress in the province of Córdoba is Electroengineering, allied with the Chinese company Petroleum Pipeline Boreau for the construction of 30% of the trunk gas pipelines. In addition, there is the Albanesi Group that through Generación Mediterráneo S.A. It owns the Modesto Maranzana thermoelectric plant located in Río Cuarto. Also, the company Iecsa (now Sacde) in charge of the sections of the gas pipelines in the provincial interior in partnership with the Chinese company Communications Construction Company (CCC). Finally, BTU and Esuco companies have also carried out pipeline works in Córdoba.

Positive or negative balance?

In short, after more than a decade of marches and counter-marches, trunk pipelines are finally a reality. What has been the largest infrastructure work in Córdoba in recent times leaves us, without doubt, a positive balance in relation to the potential benefits of the work. It will allow access to natural gas not only to thousands of citizens and hundreds of localities in Cordoba; but also to numerous industries, SMEs and businesses in the interior of the Province that will be able to boost their activity and productivity from access to the gas network. However, if we analyze the project from the point of view of transparency and accountability that must necessarily surround any work that has public funds for its realization; The balance is undoubtedly negative.

In that sense, we will continue monitoring the progress of the next stages of the work. Also trying to obtain more information about the details of its realization, the real reasons for the fall of the financing of the Chinese banks and the participation of Odebrecht in the project and its link with the Lava Jato cause, for which we are preparing requests for information which will be referred to the provincial administration.

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Authors

Mariano Camoletto

Gonzalo Roza

Contact

Gonzalo Roza, gon.roza@fundeps.org

During the month of April, Fundeps organized the annual retirement of the International Advocates Working Group (IAWG) in the city of Villa General Belgrano. Over three days, 30 IAWG members met to share information, experiences and lessons learned about non-judicial accountability mechanisms in international financial institutions (IFIs).

“Below, we offer a google translate version of the original article in Spanish. This translation may not be accurate but serves as a general presentation of the article. For more accurate information, please switch to the Spanish version of the website. In addition, feel free to directly contact in English the person mentioned at the bottom of this article with regards to this topic”.

The IAWG is a global network of civil society organizations and individuals that work to ensure that IFI complaints mechanisms ensure accountability and effective remedies to affected communities. This working group focuses on working with the mechanisms, while providing support to communities negatively impacted by IFI projects.

The grievance mechanisms associated with these institutions offer an important, and sometimes, only option for affected communities seeking accountability from IFIs or from companies that receive IFI financing.

Over the past 4 years, the IAWG meets almost annually for its members to share experiences and lessons learned around working with non-judicial complaint mechanisms. During the days of the retreat, joint actions are discussed and planned to ensure that the work of the mechanisms is as transparent and accessible as possible for those wishing to make complaints.

Contact

Gonzalo Roza, gon.roza@fundeps.org

On April 22 in the auditorium of the Nueva Córdoba headquarters of the 21st Century University, Fundeps organized a discussion on investments for development and human rights in Latin America.

During the last years, the Latin American region has been the scene of exponential growth of large development projects. For this reason, from Fundeps together with the 21st Century University, the discussion ‘Investments for Development and Human Rights in Latin America’ was organized

It analyzed the role of international financial institutions, their obligation to Human Rights, their impact on the Latin American region and the performance of their accountability mechanisms. . Also, the development in Latin America and the Human Rights issues associated with it were discussed.

There were the participation of renowned exponents who addressed these issues from their work and analyzed current trends and challenges regarding investments for development in the region. Participants: Carolina Juaneda, who serves as the Latin American Consultant of the Bank Information Center (BIC), Caitlin Daniel as Senior Communities Associate of the Accountability Counsel (AC) and Juan Carballo, Executive Director of Fundeps.

Contact

Gonzalo Roza, gon.roza@fundeps.org

Within the framework of the G20 summit held in Argentina in 2018, the Heads of State of Argentina and China signed 30 trade and investment agreements for the next five years. These agreements are part of the Second Five-Year Joint Action Plan between the two countries.

Below, we offer a google translate version of the original article in Spanish. This translation may not be accurate but serves as a general presentation of the article. For more accurate information, please switch to the Spanish version of the website. In addition, feel free to directly contact in English the person mentioned at the bottom of this article with regards to this topic.

On December 2, 2018, Argentine President Mauricio Macri and Chinese President Xi Jinping signed thirty trade and investment agreements within the framework of the second 2019-2023 joint action plan between our country and the People’s Republic of China.

The Second Five-Year Plan, like the first, seeks to strengthen the bilateral relationship and constitutes a roadmap with actions to be carried out in a number of areas. Most of the agreements are of an economic-commercial nature and include the areas of infrastructure, investments , finance, transport, mining, energy, science and technology, tourism, South-South Cooperation and electronic commerce.

Among the agreements, one of the most important is the formalization of the exchange of currencies (swap) with the Asian country for an amount of 8,500 million dollars in addition to the existing one of 11,000 million dollars.

The agreements that were already signed at the time of the announcement of the Second Plan were the Cooperation for Integral Agricultural Development Projects in New Irrigated Areas of the National Water Plan of Argentina, the Memorandum of Understanding on environmental protection and sustainable development, and the establishment of the Confucius Institute at the University of Córdoba.

Agreements have also been signed with companies such as the “Term Sheet” between the Ministry of Finance of Argentina and the Development Bank of China (CBD) for the creation of a Fund for an estimated amount of up to USD 1,000 million, in order to finance “Working Capital”; the Framework Agreement for the Promotion of Trade in Oil Products between the Ministry of Agribusiness Government and China Grain Reserves Group Ltd. Company (SINOGRAIN).

The following agreements were signed after they were announced: the Framework Cooperation Agreement between China Export & Credit Insurance Corporation (Sinosure) and the Bank of the Argentine Nation; the Addition to the Financing Contract for the “Rehabilitation of the Belgrano Cargas Railway”; the Financing Agreement between the Ministry of Finance of Argentina and the Development Bank of China (CBD) for the Acquisition of Rolling Stock for the Roca Eléctrico Railway and, finally, the Commercial Contract between the Ministry of Transportation and the Chinese company CRCC for the recovery of the San Martín Cargas Railway (Stage I: renewal and improvement of roads).

Finally, the following agreements are found:

  • Agreement on the Extension of the Validity of the Memorandum of Understanding for the Establishment of a Strategic Dialogue Mechanism for Economic Cooperation and Coordination (DECCE);
  • Agreement for the Elimination of Double Taxation with respect to Income and Property Taxes and the Prevention of Tax Evasion and Avoidance (CDI);
  • Memorandum of Understanding for Strengthening Fiscal and Financial Cooperation;
  • Memorandum of Understanding on the Promotion of Commercial and Investment Cooperation;
  • Memorandum of Understanding on Strengthening Cooperation in the Infrastructure Sectors;
  • SWAP expansion of currencies;
  • Protocol of Phytosanitary Requirements for the Export of Argentine Fresh Cherries to China;
  • Memorandum of Understanding on Electronic Commerce;
  • Memorandum of Understanding on Cooperation in Trade in Services;
  • Sanitary Protocol for the Export of Sheep and Goat Meat to China;
  • Adaptation of the Health Protocol for the Export of Standing Horses to China;
  • Convention between China and Argentina on preventing and combating the illicit traffic in cultural property, and the return of illegally transferred cultural property;
  • Execution Plan for Cultural Cooperation between China and Argentina 2019-2023;
  • Agreement on reciprocal recognition of higher education certificates;
  • Agreement between the Chinese Academy of Social Sciences of China and the Secretariat of Science and Technology and Productive Innovation on the establishment of the virtual center of social sciences China-Argentina;
  • Cooperation Framework Agreement between the National Radio, Film and Television Administration of China and the Federal Public Media System;
  • Cooperation Agreement between the Media Group of China and Radio and Television of Argentina;
  • Memorandum of Understanding on Cooperation between the National Supervisory Commission of China and the Ministry of Justice and Human Rights of Argentina;
  • Memorandum of Understanding between the Ministry of Modernization Government and the Chinese Academy of Government.

The interest of the Asian country to make investments in Argentina is linked to the actions that it has carried out since the last years in the Latin American region, positioning itself as one of the main investors. The First Five-Year Plan between Argentina and China meant the strengthening of ties in their bilateral relations with the aim of developing a cooperation strategy. With the Second Plan, a further step is being taken in strengthening and deepening the bilateral relationship between the two countries.

For Argentina, the agreements represent an opportunity for development in the future, however, we must be cautious about the risks and the potential negative aspects of them, which can result in excessive increases in debt, negative impacts at the socio-economic level. environmental infrastructure projects, competitiveness problems in the commercial field or even a certain tendency towards the reprimacy of the Argentine economy towards which several of the agreements point. And do not forget to add, to all this, opacity and little transparency in terms of access to information that surrounds the vast majority of these agreements, whose general aspects may come to light, but not their details and specifications As for its implementation.

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Author

Sofía Brocanelli

Contact

Gonzalo Roza, gon.roza@fundeps.org

 

 

On March 15, China accepted 284 of the recommendations made in its third Universal Periodic Review (UPR) before the United Nations Human Rights Council (UNHRC). These are aimed at preventing human rights violations in the field of their investments abroad. Undoubtedly, this is an unprecedented event.

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The People’s Republic of China (China) undertook, before the United Nations, to respect human rights in its investments abroad. It accepted 82% of the recommendations made by dozens of countries in its third Universal Periodic Review (UPR).

The UPR is an evaluation conducted every four and a half years by the Office of the United Nations High Commissioner for Human Rights (OHCHR). It allows rating the behavior of each member state when implementing the UN human rights treaties.

Here are some of the most relevant recommendations that were accepted:

  1. Promote measures that guarantee that development and infrastructure projects, within and outside of their territory, are fully compatible with human rights and respectful of the environment and the sustainability of natural resources, in accordance with national and international law applicable and with the commitments of the 2030 Agenda for Sustainable Development (Ecuador);
  2. Consider the possibility of establishing a legal framework to guarantee that the activities carried out by the industries subject to their jurisdiction do not undermine human rights abroad (Peru);
  3. Adopt new measures on business and human rights in accordance with their international obligations and ensure that companies operating in high risk or conflict areas conduct due diligence on human rights in accordance with the Guiding Principles on Business and Human Rights (State of Palestine);
  4. Continue to apply Chinese laws, regulations and standards, such as the Guiding Principles on Business and Human Rights, to Chinese companies that operate beyond the borders of China (Kenya);

The Chinese delegation said that its opening to host the aforementioned recommendations “fully demonstrates China’s determination and its open and active attitude towards the promotion and protection of human rights.” However, China must inform in two years in its Mid-Term Review before the UNHRC, the progress achieved after the implementation of these recommendations. In addition, you will need to develop an action plan to ensure that your companies and investors respect the rights of local communities and the environment.

María Marta Di Paola of the Environment and Natural Resources Foundation (FARN), expressed that “this commitment should not be considered a paper promise; On the contrary, social organizations around the world must take the floor to the Chinese State, keep vigilant and report to the Chinese embassies and CDHNU when there are violations in the Chinese projects, and demand redress for the violated rights of the victims and the environment “.

It should be noted that last year the Collective on Financing and Chinese Investments, Human Rights and Environment (CICDHA) presented a report in the framework of the UPR, along with 17 other Latin American NGOs, examining 18 projects with Chinese participation in Ecuador, Peru, Bolivia, Brazil and Argentina. The report showed that Chinese companies and banks have systematically violated several rights protected by the Universal Declaration of Human Rights and other United Nations instruments.

What happened in Geneva on March 15 is an unprecedented event that must be celebrated. Likewise, it is important to remember that the results obtained must be largely attributed to the hard work done by numerous civil society organizations in the region and the world.

More information

Video: Consideration of the Universal Periodic Review outcome of China

Report: Evaluation of the Extraterritorial Obligations of the People’s Republic of China from Civil Society: Cases of Argentina, Bolivia, Brazil, Ecuador and Peru

Author

Melanie Mackenzie

Contact

Gonzalo Roza, gon.roza@fundeps.org

Agustina Palencia, agustinapalencia@fundeps.org