Tag Archive for: Chinese Investments

,

We were present at the Conference: ‘Rethinking the role of foreign investment and the New Silk Road in Latin America’

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.

More information

Author

  • Sofia Brocanelli

Contact

,

The role of the AIIB in the New Route of the Green Headquarters

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”.

Descargar Documento / Download File
,

Argentina continues to bet on nuclear plants with Chinese financing

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.

More Information

Author

Gonzalo Roza

Contact

gon.roza@fundeps.org

,

We exhibited at the ALADAA National Congress about the role of the AIIB in the New Silk Road

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.

More information

Author
Mariano Camoletto

Contact
Gonzalo Roza, gon.roza@fundeps.org

,

With the trunk pipelines concluded: positive or negative balance?

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.

More information

Authors

Mariano Camoletto

Gonzalo Roza

Contact

Gonzalo Roza, gon.roza@fundeps.org

,

The Second Five-Year Joint Action Plan and the deepening of relations between Argentina and China

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.

More info

Author

Sofía Brocanelli

Contact

Gonzalo Roza, gon.roza@fundeps.org

 

 

,

China is committed to respecting human rights in its foreign investments

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.

“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 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

,

What the G20 summit in Argentina left us

After a year of meetings and activities, between November 30 and December 1, the G20 Summit was held in the City of Buenos Aires, the first held in South America. It counted with the presence of the main world leaders; and although it was considered a logistical success by the national government, it did not produce great results in multilateral terms.

“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 G-20 leaders summit organized this year by Argentina as president “pro tempore” of the forum took place in a context marked mainly by the trade war between the United States and China; and the internal difficulties that a large part of the leaders of the countries that make up the group are facing. Among them, undoubtedly highlight the civil protests that check the government of Emmanuel Macron in France, the accusations against Saudi Crown Prince Mohammed Bin Salman for the death of a journalist; and even the economic crisis facing the national government in Argentina, to which were added also the internal and external doubts regarding the capacity of the government of Mauricio Macri to organize an event of the magnitude of the G-20.

In any case, once the summit was concluded, the organization of the summit was considered a success by the government, and a final document was even signed (although its commitments are very lukewarm) despite the few probabilities that existed of achieving a consensus among member countries. The Declaration of the G20 2018 leaders emphasizes equitable and sustainable development as a challenge that all States face. Among the issues mentioned in the Declaration are the pillars on which the summit worked on a priority basis this year, at the decision of the Argentine government itself, namely: the Future of Work, Infrastructure for Development, Food Security and a perspective gender mainstreaming that covered the entire G20 agenda. The Declaration also mentions in certain passages certain international commitments regarding Climate Change and the Paris Agreement (although the United States expressed in the Declaration its decision to withdraw from the Agreement); international financial institutions and the need to strengthen the IMF and the World Bank; gender equality and access to health, among others. Regarding Infrastructure, the Declaration states: “In order to address the persistent infrastructure financing gap, we reaffirm our commitment to attract private capital for investment in infrastructure. To achieve this, we endorsed the Roadmap to Infrastructure As an Asset Class “

Recall that the G20 is an international forum that is composed of 19 states and the European Union: Germany, Saudi Arabia, Argentina, Australia, Brazil, Canada, China, South Korea, the United States, France, India, Indonesia, Italy, Japan , Mexico, Russia, United Kingdom, South Africa and Turkey. Spain is a permanent guest. In addition, the country that chairs the forum elects other guests, and for this year Argentina invited Chile and the Netherlands.

The work areas of the G-20 are: finance, agriculture, anticorruption, trade and investment, development, digital economy, education, employment, health, climate sustainability and energy transitions.

Although the Summit in Buenos Aires did not produce resonant agreements at the multilateral level, the event was without doubt positive for the national government, which comes out strengthened by the organization without major inconveniences of the event; and above all, by the agenda of meetings and bilateral agreements with other nations that took place in the framework of the Summit. Thus, the government of Cambiemos managed several bilateral meetings and closed a series of investment and commercial agreements with the purpose of promoting the country’s economic development. Thus, of the 17 bilateral meetings that the government carried out and the more than 50 agreements signed, the following stand out:

  • 30 commercial agreements between China and Argentina that represent around 5000 million dollars. The Joint Action Plan signed covers issues related to investments, infrastructure, railways, thermal energy, solar, wind, mining, health, transportation and education, among others. They include the commercial contract to reactivate the San Martín Cargas railroad, whose initial investment will be 1089 million dollars and will be in charge of the Chinese company CRCC (China Railway Construction Corporation Limited); and the signing of protocols for the entry of standing equines, sheep and goats from Patagonia to China and a sanitary protocol to export Argentine cherries.

  • In turn, with China, investment agreements were also signed for projects of Public-Private Partnerships (PPPs) in the area of ​​energy and transport (routes); and it was agreed to expand the swap (exchange) of currencies in the amount of 60 billion yuan (equivalent to 8,600 million dollars) that will be used to strengthen the reserves of the Central Bank.

  • With the United States, the most relevant agreement was reached with the letters of intent signed with the investment agency of the United States, Overseas Private Investment Corporation (OPIC), which is expected to mobilize more than 3 billion dollars. Some of these letters of intent with the OPIC contemplate the financial backing for the PPP project of the C Corridor section (Buenos Aires-Mendoza); and projects on solar energy (the Ullum I, II and III projects); wind energy (North Chubut III and IV); wind energy (Cañadón León wind farm in Santa Cruz); and works for a gas pipeline in Vaca Muerta.

  • With France, a financing agreement for 360 million dollars was made to recover the capacity of maritime naval patrols, and agreements in the cultural and educational field.

  • With the European Investment Bank, it was agreed to finance expansion and improvement works in potable water services for the metropolitan area and the suburbs of Buenos Aires; and the consolidation of the Integral Management of Residues and Energy Valorization in Jujuy.

  • The Heads of State of Japan and Argentina signed a Bilateral Investment Treaty between both countries, which aims to encourage Japanese investments in various sectors of the Argentine economy.

  • With the Russian Federation, a Fisheries and Aquaculture Agreement and a strategic document on the cooperation between Argentina and Russia in the field of the peaceful use of nuclear energy were signed.

Beyond the Summit

It is worth remembering that the Summit held in Buenos Aires was just the end of a much more extensive process that began at the end of November 2017 when Argentina assumed the “pro tempore” presidency of the G-20 at the end of November 2017 and culminated with the transfer of it to Japan. During the course of this year numerous meetings and events were held within the framework of the G20, as well as intense work in each of the affinity groups of the forum: Business 20 (B20, which encompasses the private sector); Civil 20 (C20, which includes civil society); Labor 20 (L20, which includes unions and workers); Science 20 (S20, which encompasses the scientific community) Think 20 (T20, which includes Think Tanks and the academic community); Women 20 (W20, which includes women) and Youth 20 (Y-20, which includes young people).

In the case of FUNDEPS, we actively participate in Civil 20, where we co-coordinate, together with Eurodad, one of the 8 working groups of the C20 for this year: the Investment and Infrastructure group. During the course of the year the group worked virtually and even met twice, both for the meeting of working groups and for the Summit of the C-20 held in Buenos Aires in April and August respectively. The result of the work of the working groups of the C20 was reflected in a document with policy recommendations, which was delivered to President Macri during the C20 Summit and constituted an input from civil society for the discussions that took place in the frame of the G-20.

More information

Declaración de Líderes del G20. Construyendo consenso para un desarrollo equitativo y sostenible

Página oficial del G-20

Página Oficial del C20

Policy Pack: Recomendaciones del C20 al G20 de 2018

Documento del sub-grupo sobre Financiamiento de Infraestructura

Documento del sub-grupo sobre Conducta Empresarial Responsable

La sociedad civil presenta recomendaciones al G20 en la Cumbre del Civil-20 – FUNDEPS – 15/08/2018

La sociedad civil se reunió en el C20 – FUNDEPS – 17/04/2018

G20 dejó acuerdos con intención de inversiones por u$s 8.000 millones – ámbito.com

Expectativa y realidad de los acuerdos económicos de Argentina en el G20 – Noticias

Authors

Macarena Mustafá – Sofía Brocanelli

Contact

Gonzalo Roza / Coordinador del Área de Gobernabilidad Global
gon.roza@fundeps.org

,

What does 2017 leave us in relation to trunk pipelines?

“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 year 2017 began with important and promising news for the Gasification Project of Localities of the Interior of the Province of Córdoba, better known by the people of Córdoba as the “main gas pipeline project”. During the first days of January, the Governor of Córdoba Juan Schiaretti and President Mauricio Macri were present at the inauguration of a Pressure Reducing Plant in La Calera, work carried out by the Brazilian company Odebrecht within the framework of the systems awarded to it after the public tender launched in 2015. The reduction plant constituted the first section inaugurated by the Córdoba-Gran Córdoba Ring System, comprised of 52 kilometers of gas pipelines. reinforcement, and that will benefit 300 thousand inhabitants of both Córdoba and La Calera and of Saldán, Villa Allende, Mendiolaza, Malagueño and Malvinas Argentinas, according to official information.

The presence of Macri at the inauguration of the work represented a gesture of political support for the Schiaretti government. Especially taking into account the strong questions and criticisms received by the provincial government for the involvement in this project of the Brazilian construction company Odebrecht, involved in a corruption scandal in Brazil and other Latin American countries, even in Argentina. Despite these questions, the Schiaretti government always defended the participation of the company by resorting to the debatable argument that the corruption events in which it is involved occurred between 2004 and 2013, while the tender in Córdoba was carried out only in 2015.

However, after a few days the project suffers a major setback: Schiaretti announces that, due to delays in obtaining loans from Chinese banks, 4 stretches of gas pipelines would be re-tendered to avoid postponing the start of the works in said sections, but in this case with the Province’s own financing. Recall that of the 10 trunk systems that were defined in 2015, 4 were awarded to Transitory Business Unions (UTEs) made up of Argentine and Chinese companies and financed by Chinese banks (ICBC and Bank of China); and the remaining 6 were awarded to Odebrecht (at first it was said that the Brazilian company would present its own financing for the start of the work, but finally this was not the case, making the province have to resort to indebtedness to start the works).

Thus, criticisms of the link with Odebrecht in the work will be added to questions about the delays in Chinese financing; the lack of relevant explanations regarding the reasons for the fall in financing; the need to re-tender the work and the decision of the provincial government to go back to the market to borrow to finance the work and even for the substantial increase in the cost of the work, which went from a budget of 8,600 million pesos in 2015 to 12,480 million pesos at the beginning of 2017 (an increase of 45% in almost two years).

After a new call for bids in February, in March the works of the four aforementioned systems were re-awarded to the same UTEs that had won in the first tender. In turn, the government issued a new batch of public securities for 460 million dollars to finance the start of works in the 4 tranches of the project, with the financial agent of Banco de Córdoba (Bancor).

Although in that same month of March advances were announced in the negotiations with the Chinese banks to finish making the committed credits for the work, surprisingly on April 21 the Governor Schiaretti announced the definitive fall of the Chinese financing and the signing of a decree that rendered ineffective the adjudication of the works of the 4 corresponding trunk systems. While Schiaretti himself blamed the Chinese banks for the fall in funding, arguing that they raised conditions “leonine, unacceptable to Cordoba and the national government,” the fact is that the government never made clear the true reasons and reasons that led to the fall of Chinese financing.

In this way, the government of Córdoba decided to launch a new tender for 437 million dollars for the construction of the 4 gas pipeline systems, which now in the new call would become 8 systems (in addition to the 6 remaining systems already awarded to Odebrecht ) and whose financing would come from the same province. In this case, the allocation of the new systems fell to national companies.

In early May, and despite criticism from the opposition, the provincial legislature approves a bill that enables new changes in the pipeline project: the negotiations with Chinese banks to finance 4 of the trunk systems are terminated, and it is approved that it is now the provincial government itself that must obtain the totality of the funds to complete the work (ratifying in this way the authorization granted by law 10,339 that enabled operations to take public credit to carry out the works). Just a few days later, the government made official through a decree published in the Official Gazette, a new debt collection for 450 million dollars to finance the work. By the end of June, Schiaretti himself would announce through his Twitter account that the province had obtained the total financing for the work through the placement of bonds in the international capital market.

In short, this strategic project for Córdoba that was going to have in the beginning with financing provided or managed by international actors (initially through the National Bank of Economic and Social Development of Brazil -BNDES-, then through Chinese banks and own financing provided by the Odebrecht company) to depend exclusively, for its concretion, on the province’s own resources or obtained through debt through the issuance of government securities.

The second half of the year would be marked mainly by the progress of the work (according to the government by the end of the year 14% of the work had been completed and the work was planned to be completed by mid-2019), but also by the constants and recurring questions from sectors of the opposition and civil society in relation to the project. Especially after Córdoba was mentioned in the framework of the Lava Jato case as one of the destinations where the Odebrecht constructure paid bribes in Argentina.

Although the national government of Mauricio Macri began a campaign to review and investigate the possible involvement of Odebrecht in the payment of bribes in numerous public works projects in Argentina (which even led the national government to suspend the company to carry out works at a national level), the gas pipeline project in Córdoba was strangely excluded from said revision and the relevant explanations were never provided to justify such exclusion. Even the company continues to operate in the province despite its suspension at the national level (its main work is precisely that of gas pipelines in Córdoba) and the requirements from the opposition that the same be done at the provincial level. Given the lack of answers at the national level, some opposition legislators traveled to Brazil in October of this year to ask the prosecutors of the Lava Jato case to investigate the link between the Brazilian company in the payment of bribes in the framework of the bidding process in 2008 for the construction of trunk pipelines.

In this way, between marches and counter-marches, the balance of 2017 in relation to the trunk gas pipeline project throws little light and many shadows and suspicions in relation to the transparency and execution of the project. Not only because of the never entirely clear fall of Chinese financing at the beginning of the year but also, and above all, because of the way the provincial government has handled the involvement of the construction company Odebrecht in the work and the numerous causes of corruption that splash throughout Latin America and even in Argentina itself. Although the government of Schiaretti has detached the company from any kind of connection with the possible delivery of bribes and corruption in the bidding of the work (even with the support of the national government of Macri itself that has initiated a kind of “Crusade” against the Brazilian company for its actions in the country during the Kirchner government), the truth is that the year that ends leaves many questions and aspects not clarified about the project.

Undoubtedly, 2017 has left a huge debt outstanding in terms of transparency and accountability in relation to this strategic and emblematic project for Córdoba. From FUNDEPS, we expect this debt to be paid in 2018.

More information

– Working Document: Transparency in the gasification project of localities in the interior of the province of Córdoba by Melanie Mackenzie – December 2017. FUNDEPS.

– Notes and publications of FUNDEPS in relation to trunk gas pipelines.

–  Main gas pipelines in Córdoba: a work that advances in the shadow of corruption by Agustina Palencia – December 2017. El Entramado. FUNDEPS.

Image source

La Voz del Interior

Authors

Macarena Lourdes Mustafa / Voluntaria del Área de Gobernabilidad Global

Gonzalo Roza / Coordinador del Área de Gobernabilidad Global

Contact

Gonzalo Roza / Coordinador del Área de Gobernabilidad Global

gon.roza@fundeps.org

,

China-Argentina relations under the Macri administration: do we change?

This working document presents a brief analysis of the current relations between the People’s Republic of China and Argentina in a national and international context; and taking into account aspects such as the relationship between the Asian giant and the Kirchner government, the change of government that took place in Argentina at the end of 2015, the Argentine economic reality and the election of the Republican Donald Trump as president of the United States.

Descargar Documento / Download File
,

Claim for higher standards of protection of DD.HH. in infrastructure megaprojects

“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”

Currently, the Latin American region has witnessed a resounding change in the area of ​​large investments for development. Traditionally, international financial institutions (IFIs) played a fundamental role in supporting development projects in the region. The World Bank Group and the Inter-American Development Bank Group were behind the large investments in the infrastructure area.

This situation has been modified by the increase in the presence of the People’s Republic of China as the main investor in this matter. In this regard, it is necessary to highlight that this situation has brought about a strong discussion regarding social and environmental standards. Traditional IFIs have regulations that, while far from functioning properly in practice, minimally seek to ensure compliance with certain environmental, social and human rights standards in their projects. In the case of Chinese institutions, on the contrary, the situation is more complex, since in most cases these institutions lack transparency or clear and robust regulations in socio-environmental matters.

The consequence of the coexistence of these two groups of institutions – the traditional IFIs and the Chinese ones – has given a negative balance and this has been evidenced in the retreat of the safeguards in organisms such as the World Bank. In this sense, the current financing structure in Latin America has seen its standards fall, generating serious situations of violation of rights when launching large infrastructure projects. During 2016, 200 environmental defenders lost their lives claiming their rights before the advance of major oil and mining projects. 60% of those deaths occurred in Latin America and 40% belonged to indigenous peoples.

From this framework, the Regional Coalition for Transparency and Participation, brought together a group of civil society organizations with the aim of influencing the improvement of socio-environmental standards in infrastructure megaprojects. At the Fourth Regional Meeting on Human Rights, Transparency and Investments, held in Lima on August 30 and 31, the organizations gathered spoke for the urgent need to ensure the rights of environmental defenders. Likewise, the growing cases of corruption around the megaprojects and the lack of access to public information were highlighted.

The statement after the meeting noted that: “several governments have been addressing the right of access to public information as a mere administrative procedure, without taking into account that it is an instrumental human right to other fundamental rights, such as the right to life, to health, to freedom of expression, which contributes to the adequate and timely citizen participation and free and informed prior consultation. In this line, it is worrying that several international initiatives on transparency and access to information can not continue to advance adequately because there is a risk that we seek to lower the standards, as in the case of the Regional Agreement of Principle 10.” The large infrastructure projects then, today remain the scenario for the problematization of issues such as transparency and accountability.

Several governments in Latin America have joined the Open Government Partnership (OGP) and have therefore committed to implementing policies that promote transparency, access to information, accountability and participation. citizen This necessarily implies that these efforts to ‘open the State’ must expand to the environmental and infrastructure branch. Currently this is a pending debt and of the 3000 commitments assumed before OGP, only 54 belong to the field of infrastructure. Chile, Colombia, Costa Rica, the Dominican Republic, El Salvador, Guatemala, Mexico, Panama and Uruguay are the Latin American and Caribbean nations that have elaborated goals in relation to this matter. However, the problems persist and the situation of human rights around the megaprojects has been getting worse. In addition, after the Fourth Meeting of the Regional Coalition, it was highlighted that “it is important that the processes for the elaboration of the Work Plans of the Alliance for Open Government of the countries be truly participatory and with ambitious, measurable and relevant “. This is especially important when it comes to achieving the involvement and monitoring of society in public works processes (throughout the project cycle).

In Argentina this reality is replicated. Currently, large infrastructure projects are being developed that have been involved in corruption cases and whose information was not shared with citizens. We can mention among them: the hydroelectric dams in the Province of Santa Cruz and the trunk gas pipelines in the province of Córdoba.

The generalized situation of human rights around infrastructure megaprojects is alarming. There continue to be numerous cases in which nearby communities are harmed by this type of work. Added to this, the killing of environmental defenders has worsened in the last two years. In this context, we adhere to the Lima Declaration and urge Latin American governments to move towards more transparent policies on this issue.

More information

– Declaration of Lima

Author

Agustina Palencia, agustinapalencia@fundeps.org

Contact

Gonzalo Roza gon.roza@fundeps.org

We participated in the workshop on advocacy actions against Chinese investments in the region

Representatives of civil society and native communities participated in the workshop in the city of Bogotá (Colombia). The result was the elaboration of an agenda that complements the territorial demands of the affected communities with the proposals raised from civil society and the academy.

“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 May 17 and 18, the workshop was organized by the Regional Group on Financing and Infrastructure and the Regional Coalition for Transparency and Participation. The workshop sought to strengthen the joint action of civil society (communities, movements and social organizations, national and local) that are being affected by projects financed by Chinese banking and what monitor the social and environmental impacts of these investments in Latin America.

Topics related to the social and environmental policies currently implemented by Chinese institutions, the analysis of Chinese funding in the region, the projects to which it is intended and the identification of the impacts of these projects on the environment and human rights were addressed. We attended civil society representatives from Argentina, Chile, Bolivia, Brazil, Peru, Mexico, Colombia, Venezuela, Ecuador and representatives of native and peasant communities.

We emphasize the alarming situation of environmental defenders in Chinese investment contexts in countries of the region, who are not only criminalized for the defense of their collective rights but also lack the protection of the State . We succeeded in strengthening the Continental Alliance to follow up on Chinese investments to face the geopolitical strategy that seeks to maintain the constant export model of raw materials in Latin America and the Caribbean.

Those of us participating in the workshop agree that weakening the environmental and social frameworks of the region does not guarantee respect for the rights of the communities involved in the area of ​​influence of the projects that are financed by Chinese banks. Added to this is the non-binding nature of the Chinese banking guidelines. The non-existence of protection at the national level and at the level of multilateral banking puts the communities that are being affected by the investment at risk.

As a result of the Workshop, an advocacy agenda was drawn up that brings together and complements the territorial demands of the affected communities with the reform proposals put forward by civil society and academia. In this regard, at the international level, new standards for companies and Chinese banking are proposed that guarantee compliance, greater participation and effective consultation processes; At the national level, a joint strategy that will reverse the weakening of socio-environmental legislation and provide guarantees of equitable access to justice for environmental defenders.

More information

Contact

María Victoria Gerbaldo, victoriagerbaldo@fundeps.org