Is Argentina Moving Towards New, 'War Economy' Measures?
August 18, 2014 • 8:57AM

After having raided the Buenos Aires headquarters of HSBC last week — London's notorious Hongkong and Shanghai Banking Corporation, which for decades has been the central bank of Dope, Inc.'s international drug trade — and this week filing criminal charges against the vulture fund-linked Donnelly printing company in Argentina, for fraudulently filing for bankruptcy and shutting down its operations, on Saturday, the Argentina government launched a major broadside against Royal Dutch Shell in the country. Planning Minister Julio De Vido took to the radio airwaves on Aug. 15 to charge Shell with "speculating rather than producing," saying it "doesn't invest anything to produce natural gas and oil in our country," but prefers to find "areas for speculation, as if they were a real estate investment, rather than a productive investment. Shell should invest in the production of hydrocarbons in the areas assigned to it," De Vido threatened, "rather than keeping them idle." De Vido made it clear that the oil multinational should invest at least $1 billion in expanded production, or face the consequences.

What consequences?

Some informed observers believe that Argentina may well be planning stepped-up "war economy" measures to deal with the financial warfare being launched against the country, led by the vulture fund assault with backing from the U.S. Supreme Court. President Cristina Fernandez de Kirchner has repeatedly emphasized that the driving motivation of the vulture funds is not greed, but rather is a strategic policy of the world's financial centers to forcibly re-indebt Argentina in order to seize control over its sizeable natural resources, including the giant Vaca Muerta shale oil deposits.

If history is any guide, the nature of those upcoming measures could include:

  • (1) Nationalizing all or part of the private banks, especially foreign controlled banks, that participate in financial warfare against Argentina;
  • (2) Fully renationalizing YPF oil company, which was partially privatized by earlier neoliberal Argentine governments. A step back towards national control was taken earlier this year when the Spanish Repsol company was forced to sell its shares back to YPF;
  • (3) Nationalizing or drastically regulating foreign trade, especially in vital food exports, both to guarantee supplies to new customers such as Russia, as well as to take further control over dollar flows in and out of the country; and
  • (4) Strengthening existing exchange controls to prevent capital flight and other forms of financial warfare.

All of these measures — and others — are fully consistent with policies adopted historically by Peronist governments in Argentina; the current government is also Peronist. Such measures are also the "patriotic reflex" that Argentina will tend to have, strengthened by the BRICS dynamic, especially given that Russia is actively pursuing a "war economy" approach of its own, which intersects Argentina directly on the question of food supplies.

Argentina Successfully Tests Tronador II Satellite Launcher

Planning Minister Julio De Vido announced on August 15 that Argentina had just successfully tested the second of a series of 3 to 6 experimental rockets, which are prototypes of the Tronador II satellite launcher under development. Produced entirely in Argentina with 100% domestic technology, the Tronador II will have a height of 14.5 meters (about five stories), will achieve a maximum velocity of 828 km/hr, and will be able to place in orbit a 250 kg satellite, which will also be 100% built in Argentina and will be launched from Argentine territory.

De Vido summarized the significance of the government's policy and this specific achievement:

"This test constitutes another advance along the road towards sovereign technological development in terms of satellites made possible by the policy set in motion by Nestor Kirchner, which continues under President Cristina Fernandez de Kirchner, of reestablishing national capabilities in strategic sectors for the country. All of these 100% national developments will allow us to carry out a complete satellite launch on our own, that is, the construction of the satellites and placing them in orbit; and that will also allow us to launch satellites of third parties, converting Argentina into the only country in the Southern Hemisphere, and one of only 11 in the world, with that capability. With this initiative we are deepening the process of the industrialization of Argentina in high value-added and advanced technology sectors."