Authorities in Buenos Aires are recommending that Argentine firms stop buying British goods. That may be easier said than done. Though Argentina doesn’t buy much from the UK, the British products it does import are difficult to find elsewhere.
BUENOS AIRES – A month before the 30th anniversary of the Falklands War on April 2, tensions between Buenos Aires and London are on the rise. What until now has been a purely diplomatic row is now beginning to take on an economic dimension.
This past Tuesday, the heads of some 20 leading firms in Argentina received a curious phone call – from Argentine Industry Minister Debora Giorgi. Her message was that the country's business leaders consider substituting purchases they currently make from Great Britain with products made in other countries.
Among the companies contacted was Syngenta, the world's leading agrochemical company, which buys pesticides in London; the Ford automobile company; and the pharmaceutical group Roemmers.
The move is mainly symbolic – a new way for Argentina to challenge Great Britain's continued claims on the Falkland Islands, which Argentines call the Malvinas. British-made products, after all, account for less than 1% of Argentina's total imports. In total, the South American country bought just under 500 million euros worth of British goods in 2011. But there is an economic motive as well: Buenos Aires is keen to maintain its trade surplus with the United Kingdom. The surplus, which now stands at just 77 million euros, shrunk between January and November 2011 by 60%.
"Countries that use colonialism..."
The ministry of industry stands fully behind this first step towards a boycott of British goods. "It's fundamental that Argentina decide for itself who its strategic trade partners are," the ministry explained in a press statement. "In this sense, the Argentine government is also sending a message to those countries that still use colonialism as a way to access far-away natural resources."
In recent years, British petroleum companies have taken initial steps toward exploiting the Falklands for its large oil deposits. The disputed islands lie some 500 kilometers off the Argentina coast.
London was quick to react. Downing Street called the measure "counter-productive" since "the United Kingdom is also a major investor in Argentina and we import goods from Argentina. It is not in Argentina's economic interest to put up barriers of this sort."
It remains to be seen how well Argentina's CEOs will follow the government's recommendation. "The pound sterling is one of the world's strongest currencies," notes Marcelo Elixondo, ex-president of the Argentine Export Foundation. That means that when an Argentine company buys British products, they do so not because it's cheap, "but because those products can't be found elsewhere," he says.
Read the original article in French
Photo - Douglas Fernandes