In a firm rebuff to China’s combination of threats and flattery, Argentina’s new government, under President Javier Milei, has rejected joining the BRICS group. This decision marks a significant setback for China’s ambitions to expand its influence in Latin America.
The BRICS coalition of Brazil, Russia, India, China, and South Africa is progressively perceived as a Beijing-led geopolitical group aimed at broadening its sway and redefining the global hierarchy.
Contrasting with his pro-communist predecessor, President Milei has maintained a strong anticommunist stance, complicating China’s diplomatic efforts. In a statement to Bloomberg News in August, Milei emphasized, “People are not free in China, they can’t do what they want, and when they do it, they get killed … Would you trade with an assassin?”
Attempting to influence Mr. Milei, Chinese leader Xi Jinping quickly sent a congratulatory letter upon his election victory, conveyed on Nov. 21 through the Chinese ambassador to Argentina. Despite its courteous tone and promises of economic benefits, the gesture failed to sway the Argentine leadership.
China had anticipated that Mr. Milei would continue his predecessor’s plans to join BRICS by Jan. 1, 2024. However, Mr. Milei’s position remains unyielding. He identifies Argentina as “an ally of the United States, Israel, and the West,” firmly opposing alliances with non-democratic regimes.
Argentina’s incoming foreign minister, Diana Mondino, further underscored this stance in her remarks to RIA Novosti, a Russian state-owned news agency, announcing a pause in diplomatic interactions with Brazil and China.
This development has alarmed the Chinese Communist Party (CCP), as Latin America represents a strategic region in its global tug-of-war with the United States. The CCP has resorted to a dual strategy of appeasement and intimidation in its dealings with Argentina’s new administration.
Mao Ning, a spokesperson for China’s foreign ministry, cautioned at a press briefing that severing ties with key trading partners like China could be a grave diplomatic error.
This statement about trade, according to Anders Corr, founder of Corr Analytics and publisher of the Journal of Political Risk, was “a veiled threat to punish Argentina economically, which would hit the country where it hurts due to its current financial crisis.”
Economic Context and Challenges
Argentina faces daunting economic challenges, with an inflation rate soaring to 138 percent in September and expectations of further escalation. JPMorgan projects a peak of 210 percent by year-end, while central bank analysts predict around 180 percent.The nation’s foreign exchange reserves are at their lowest since 2016, exacerbated by severe droughts impacting crucial crops. The economy, Latin America’s third-largest, is projected to contract by 2.8 percent this year, plunging two-fifths of the population below the poverty line.
Yet, in a Nov. 30 social media post, Ms. Mondino reaffirmed the government’s decision not to join BRICS, underscoring Argentina’s commitment to its diplomatic and economic principles.
BRIC was initially a financial acronym in 2001 (the “S” of South Africa was added in 2010), but became an established organization in 2009 and has evolved into a significant geopolitical entity, often positioning itself in opposition to Western dominance led by the United States. China has strategically leveraged BRICS to challenge the G7’s global economic influence.
In the lead-up to the BRICS summit in Johannesburg, South Africa, this August, discussions intensified around promoting global “de-dollarization,” a move indicative of China’s broader strategy to destabilize the dollar’s hegemony. Brazil’s proposal for a BRICS currency earlier this year further underscores this ambition to redefine the global economic order.
Expanding this anti-Western alliance, China has actively invited new members. In 2022, Xi Jinping extended an invitation to Argentina to join BRICS. The summit in August announced the inclusion of Argentina, Iran, Egypt, Ethiopia, Saudi Arabia, and the United Arab Emirates as members starting Jan. 1, 2024.
Argentina’s Pivot to US Alliance
Newly elected President Javier Milei, not yet in office, expedited a visit to Washington, D.C., seeking aid for Argentina’s economic crisis. His proposed recovery plan includes dollarization and austere economic reforms.During his Nov. 28 visit, Mr. Milei engaged with top U.S. officials and International Monetary Fund representatives to discuss reshaping Argentina’s foreign policy and economic strategies. Notably, meetings with National Security Advisor Jake Sullivan and Juan Gonzalez, senior director for the Western Hemisphere at the National Security Council, were pivotal.
The White House disclosed that discussions with Mr. Milei revolved around strengthening bilateral economic ties and shared priorities like clean energy and technology investments.
Latin America has long been an arena of U.S.-China rivalry. While the United States was preoccupied with conflicts in Afghanistan and Iraq, China made significant advances in Latin America. The early years of the twenty-first century saw a surge of left-leaning governments in the region, often termed the “pink tide,” in nations including Argentina, Bolivia, Brazil, Ecuador, and Venezuela.
China’s influence grew through substantial purchases of Latin American commodities like copper, pork, and soybeans, and significant infrastructure investments, surpassing the United States as the region’s primary trading partner.
Until recently, the Argentine government displayed strong pro-communist tendencies. In February last year, for example, the government, then led by Mr. Milei’s electoral opponent Sergio Massa, announced China-funded infrastructure projects worth approximately $24 billion. The Massa administration enthusiastically embraced China’s involvement, with lighthearted suggestions of an “Argenchina” partnership.
However, Mr. Milei’s ascent to power represents a significant shift in Argentina’s geopolitical alignment, marking a setback for China’s ambitions in Latin America.
