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Other external relations

Argentina: Other external relations

Full diplomatic relations were restored with the UK in 1990. Argentina and the UK also agreed the joint administration of a protection programme for the lucrative South Atlantic fishing region. The question of sovereignty over the disputed Falkland Islands was not resolved. The discovery of rich petroleum deposits in the region in 1993 further complicated the issue. Although a comprehensive agreement on exploration was signed by both countries in 1995, negotiations on fishing rights in the region remained tense. The two countries agreed to resume negotiations on a long-term fisheries accord in 1997. In 1998 the UK partially lifted its arms embargo against Argentina and in 1999 the ban on Argentine citizens visiting the Falkland Islands was ended and air links between the islands and South America were restored.

Relations between the two countries deteriorated in 2007, when Argentina withdrew from the 1995 agreement on petroleum exploration, and again in 2008, when the Argentine Government accused the UK of illegitimately issuing licences for hydrocarbon exploration around the islands. In 2010, as oil companies prepared to commence drilling around the islands, President Fernández decreed that ships entering Argentine waters en route to the Falklands must obtain prior permission. The Government formally requested that the United Nations (UN) initiate sovereignty negotiations with the UK. The UK’s announcement in October that it was to conduct military exercises off the coast of the Falklands provoked strong protests from Argentina. Meanwhile, Argentina’s MERCOSUR partners demonstrated their support for Argentine sovereignty over the Falklands, with Uruguay and Brazil refusing to allow British naval vessels to refuel at their ports en route to the islands. In 2011, moreover, MERCOSUR heads of state agreed to prevent vessels flying the Falkland Islands flag from entering their ports. Fernández reiterated demands for talks on the status of the islands, but the British Government maintained its stance that negotiations would not take place without the agreement of the islanders. Bilateral tensions mounted in 2012, the 30th anniversary of the Falklands conflict. In February Argentina’s Government made an official complaint to the UN alleging that the UK was militarizing the South Atlantic with the planned deployment of an advanced naval destroyer to the area. In April the UK halted British exports to the Argentinian armed forces with the stated aim of ensuring that such exports could not be used by Argentina in the imposition of an ‘economic blockade’ on the islands. In June Fernández addressed the UN Special Committee on Decolonization, reasserting Argentina’s claim to sovereignty of the Falklands and again demanding talks with the UK. The Argentine Government rejected the result of the referendum held in the Falkland Islands in March 2013, in which 99.8% of participating islanders voted in favour of retaining the political status quo. In November the Chamber of Deputies approved the imposition of a fine, equivalent to 1.5m. barrels of petroleum, on any company involved in oil exploration in Falkland Island waters without the consent of the Government. Firms would also be prohibited from operating in Argentina and their directors could face prison sentences of up to 15 years. The Government responded with hostility to the UK’s announcement in March 2015 that additional British military assets would be deployed to the islands in order to bolster its defence capabilities. Argentina filed complaints with the UN’s Special Committee on Decolonization and various regional bodies. In June a federal court ordered the seizure of assets from five foreign companies involved in oil exploration in Falkland Island waters.

President Mauricio Macri in December 2015 declared that his country would uphold all claims of sovereignty over the Falklands, but suggested that a more co-operative stance between the two nations should be sought. To this end, in September 2016 talks between the two countries began on possible economic co-operation regarding the Falklands, including the resumption of commercial flights from Argentina. In the same month Macri, in a speech to the UN, urged amiable dialogue on the issue of sovereignty. Macri reiterated Argentina’s sovereignty over the Falklands in a speech to the UN in September 2018. In the following month the Argentine foreign minister Jorge Faurie met with his British counterpart Jeremy Hunt in London to discuss bilateral co-operation and increasing trade links between the islands and Argentina.

Nationalistic economic policies under President Fernández damaged Argentina’s external relations, most notably with Spain and the USA, its two most important foreign investors. Tensions with Spain arose in 2012, when Fernández ordered the expropriation of 51% of the Spanish company Repsol’s shares in the formerly state-run oil firm Repsol YPF. The Spanish Government retaliated by restricting imports of biodiesel from Argentina, while Repsol lodged a complaint against Argentina with the World Bank’s International Centre for Settlement of Investment Disputes (ICSID). A resolution was reached in 2014.

Moreover, in 2012 the European Union complained to the World Trade Organization (WTO) that Argentina was seeking to restrict imports in contravention of international trade rules; the USA and several other countries subsequently filed similar disputes with the WTO against Argentina. The USA suspended Argentina from eligibility for trade benefits under its Generalized System of Preferences for developing countries, following the latter’s failure to pay compensation to two US companies in compliance with rulings issued by the ICSID in 2005–06

By contrast, President Macri sought to implement a more open trade policy and to increase Argentina’s role on the international stage. In March 2016 he welcomed US President Barack Obama to the country, the first official visit by a US head of state for almost 20 years. Increased bilateral co-operation on anti-drug trafficking measures was announced in the following month. Relations with the USA further improved under the Administration of Donald Trump; Macri made an official visit to Washington, DC, in April 2017, during which both countries pledged to strengthen trade ties, including an end to the US ban on Argentine lemon imports. In May Macri visited the People’s Republic of China, Japan and the United Arab Emirates where he reached agreement on several accords designed to increase foreign investment in Argentina, as well as boost bilateral trade.

Citation: Other external relations (Argentina), in Europa World online. London, Routledge. Retrieved 19 January 2020 from http://www.europaworld.com/pub/entry/EE000292

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