China Looks To Break Into Latin American Market Via Argentina.

The 5 February communique that followed a summit meeting in Beijing between the leaders of China and Argentina may have affirmed a number of previously reported military programmes, but most have yet to produce contracts.

China Looks To Break Into Latin American Market Via Argentina.

The programmes mentioned in the communique had previously been the subject of discussions under an Argentine-Chinese Joint Committee on Cooperation in the field of Defence, Technology, and Industry. In the naval sphere, those affirmed include the construction by China of a new icebreaker, new tugboats and new offshore patrol vessels. The latter are likely to be 1,800-ton P-18N corvettes, two of which reportedly will be built in China and up to three in Argentina.

Army programmes affirmed include the exchange of officers, construction of field hospitals, and the co-production in Argentina of Norinco 8x8 VN1 amphibious armoured personnel carriers (APCs). 

In a 5 February TV interview, Argentine Minister of Defence Augustin Rossi said Argentina intended to market the VN1 to other Latin countries. If this deal materialises it will likely mean the end of Argentina's interest in purchasing Brazil's VBTP-MR Guarani wheeled APC, a co-produced version of the IVECO Superav.

Not mentioned in the pre-summit reporting out of Argentina was the communique's announcement of a new "working group with a view to the incorporation by Argentina of Chinese designed fighter jets".

Argentine reports from the summit indicated discussions focused on the possible sale of 14 Chengdu J-10/FC-1 fighters built in China. Sources at the Fabrica Argentina de Aviones (Argentine Aircraft Factory, FAdeA) had previously told of their interest in co-producing the FC-1, raising the prospect that it would also be marketed to other Latin countries.

However other Argentine sources note that for logistic continuity the Argentine Air Force prefers European designs such as used French Dassault Mirage 2000s or ex-Spanish Air Force Mirage F1 fighters, both the subject of recent discussions. These sources also note that the Argentine Air Force cannot afford the Chinese fighters unless they are funded under other commodity payment schemes.

Also of strategic significance for Argentina and China was a separate communique that outlined space co-operation. China will build and man a new space tracking and control station on a 200 hectare facility in the southern Argentine province of Neuquen.

For China this facility provides a vital deep southern hemisphere node for global ground-based tracking and control, which is needed to manage its growing satellite networks, manned space stations, and lunar programme. Argentine sources note that a crucial quid-pro-quo is that Buenos Aires will gain access to strategic information from China's formidable surveillance satellite constellation.

While uncertainties abound regarding the reality of Sino-Argentine military relations, especially given Argentina's questionable ability to pay for new equipment programmes outside of Chinese concessional loans funded by payments in commodities, ambitions point toward a deepening relationship.

China is now at least in discussions to sell Argentina new weapon systems for each of its armed services. While 100 or more APCs, up to five corvettes, or 14 new fighters may not significantly alter the balance of power with Argentina's neighbours or in regards to Argentina's ambitions to take the Falkland Islands (Malvinas), this could also mark the beginning for more substantive Chinese military exports.

This, combined with the prospect for strategic space co-operation, creates a possible shift in the balance of power in Latin America and increase China's military influence in the region. Furthermore, plans to transfer the means for Argentina to become a marketer of Norinco APCs, and potentially low-cost fighter aircraft, could give China its first significant military-commercial "beachhead" in Latin America.

Reports suggest that the defence elements of the 5 February communique have angered Brazil, which has ambitions to become a regional leader in military technology. Brazil has sought to outflank competitors through co-operative military deals with Argentina, such as FAdeA's production of parts for the new Embraer KC-390.