Argentina's Train Diplomacy: A Gateway to the Chinese 21st Century Maritime Route?

Argentina's Train Diplomacy: A Gateway to the Chinese 21st Century Maritime Route?

DOI: 10.4018/978-1-7998-3503-5.ch001
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Abstract

The objective of this study is to analyze the impact of the OBOR initiative for Argentina, starting from the premises that Latin America is not considered fundamental for the OBOR initiative and that Argentina played a secondary role in its economic relationship with China. In other words, could Argentina be considered to be on the periphery of the periphery for China and the OBOR initiative? And a more important question, could Argentina escape from that position to which it seems to be historically condemned? To answer these questions, a case study has been selected, the railroad Belgrano Cargas (FBC), because of the importance it represents for Argentine and Chinese interests. Argentina considers it a fundamental means to strengthen the national economy and connect, above all, the interior of the country (Central and Northwest) with Buenos Aires; China, on the other hand, sees in the FBC another means to create a bi-oceanic corridor capable of transporting primary products from Argentina to Chile and from there to China.
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Introduction

During his visit to Kazakhstan in September 2013, Chinese President Xi Jinping launched the Silk Road (OBOR) initiative. The following month, in Indonesia, Xi mentioned the concept of “OBOR maritime 21st century”, and from November 2013, during the Third Plenary Session of the 18th PCC Congress, it received the support of the highest levels of government, becoming a national strategy. The initial objective was to create a comprehensive infrastructure for upgrading OBOR's original trade routes1. In December 2014, the OBOR Fund was created and in February 2015, the OBOR Committee approved its first project in April. By the end of that year, the Asian Bank for Infrastructure and Investment (AIIB) (Parker, 2017)2 was founded, which accepted the first projects in June 2016. As President Xi pointed out at the Davos meeting in January 2017, China will be the leader of the new globalization. A globalization different from that proposed by the United States, since it is based largely on “South-South” cooperation. Perhaps this is the most important economic issue of the day - and possibly will continue to be so in the coming years - at least for those countries that could benefit from a “shift in global wealth” from OECD economies to emerging economies (OECD/ECLAC/CAF, 2015). In the same way, OBOR is also attracting interest in the academic world, as many researchers wonder how a communist country can embrace the concept of globalization and modify its nature to give it a new, if preferred, more human face.

The OBOR initiative aims to include 68 countries plus China and international organizations along land and sea routes; with an aggregate population of 4.5 billion; and with a total nominal GDP of $23 trillion (62% of world GDP) (The KraneShares, pp. 9,10,16; Chi, 2015, p. 55; Chin & He, 2016)3. Since this program was put on the agenda by Xi, China signed more than 130 bilateral and regional transport agreements; 356 international road routes were opened, both for passengers and cargo; there are currently 4,200 direct flights connecting China with 43 OBOR countries and Chinese companies signed 952 contracts in 61 countries along OBOR. In short, OBOR aims to become the world's largest system and intends to fight global poverty while maintaining a win-win relationship for all member nations (Zepp-Larouche, 2017)4.

Despite the magnitude of this initiative, Latin America is in a secondary position to the initial OBOR objective, on the periphery of the South-South relationship. Perhaps that is why the literature is not too extensive regarding the relations between OBOR and Latin America. However, several CEPAL publications (2015, 2017) should be mentioned that recognize the links, challenges and opportunities between China and Latin America. Other milestones in this connection include: the White Book (2008) on relations with the region; the proposal to strengthen political, economic and cooperation relations put forward by the then Prime Minister, Wen Jiabao (2012); the proposal for an ambitious cooperation framework for the period 2015-2019, known as “1+3+6”, presented by Xi (2014) during the first Latin American and Caribbean-China Summit; the approval of the above-mentioned Cooperation Plan 2015-2019 between CELAC member States and China; the visit of Prime Minister Li Keqiang to Brazil, Chile, Colombia and Peru (CEPAL, 2015).

In relation to Argentina (a country that has played a secondary role in the bilateral economic relationship for 15 years due to the quantity and diversity of products that it can offer compared to the Asian giant), Oviedo (2015, p. 70), pointed out that China's economic growth served Argentina as a supplier of raw materials and at the same time as a recipient of manufactured products and investments. In a mutually convenient way, bilateral trade increased, but on the other hand, the asymmetries of the North-South model were sharpened. Argentina again resigned itself to a secondary role known as “centre-periphery”, despite its active support for China in international forums (Cesarín, 2010; Escudé, 2011, pp. 2-4; Aronskid, 2015, pp. 29-33; Tulchin, 1990; Galasso, 2008)5.

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