Argentina Rises, Minus Its Swagger Feb 4, 2008 0:32:37 GMT -5
Post by Bozur on Feb 4, 2008 0:32:37 GMT -5
Argentina Rises, Minus Its Swagger
DONOR NATION Argentina’s grain helped Italians recover after World War II.
By ALEXEI BARRIONUEVO
Published: February 3, 2008
RIO DE JANEIRO
EARLY in the last century, Argentina was one of the world’s 10 richest countries. Its fabled beef and other farm exports were building an industrial economy. In 1928, it had more cars than France and more telephone lines than Japan. The dream of its Spanish founders — to transform a wild land tucked near the bottom of the world into a great country of European culture and education inhabited by white-skinned people — was coming true.
But those days are deep in the past. As the Argentine author Tomás Eloy Martínez wrote in “Requiem for a Lost Country,” a nation once obsessed with its “greatness” is “obsessed by the fear of being thrown into irrelevance. ” Mr. Martínez wrote those words in 1993, before a crushing economic crisis in late 2001. In its aftermath, crime-filled slums sprang up and the country’s currency lost two-thirds of its value. Today, there are beggars in the streets of Buenos Aires; wealthy neighborhoods fall prey to thieves and crack-cocaine addicts.
For many prideful Argentines, the hardest thing to accept has been the inexorable rise of their much-larger neighbor and perennial rival, Brazil.
That rise, in the works for decades, was thrown into sharp relief with the discovery of a huge oil field off Brazil’s coast last fall, followed by a natural gas discovery two weeks ago just as large.
And that has deepened Argentine feelings of nostalgia and introspection. Over the course of two generations, they reacted to Brazil’s rise first with denial, then resignation, then respect. Now, many seem to be arriving at the most humbling feeling of all: a desire to emulate the nation they had thought was something less than their own.
Brazil has always been seen from Buenos Aires as a wild place that was late to abolish slavery, and whose fusion of African and Latin American vitality was no match for Argentina’s homogeneity and European sophistication.
In the last 50 years, Brazil, like Argentina, suffered through economic crises, military dictatorship and political corruption before attaining stable democracy. But it also found a path to displacing Argentina as the continent’s economic giant. And since the Tupi oil field announcement in November, Buenos Aires’ newspapers have been dwelling on how far ahead Brazil has surged.
“Is it possible, still, to emulate Brazil?” asked a headline over a column by Mariano Grondona in La Nación.
“For the generation of our parents it was offensive for us to be compared with Brazil,” he wrote in December. Even in the 1960s, when Brazil’s economy grew by 10 percent a year, Argentines consoled themselves with thoughts of their higher per capita income. True, production levels had reached par, but Brazil’s population was more than three times as big.
By the 1970s, he wrote, Brazil’s continued rise was taken so seriously that it gave credibility to an Argentine coup; one of its leader’s goals was to maintain parity with Brazil at all costs.
But now, Mr. Grondona wrote, “my generation has seen, in contrast, how Brazil has pulled away from us.”
And its reaction is different. Eduardo Sigal, Argentina’s deputy secretary for integration, put it this way: “Twenty years ago we would have been very jealous. A decade ago it would have caught our attention but we would have reacted a bit more calmly. And today we see it as a great possibility, because we consider ourselves partners.”
Argentina’s then-president, Nestor Kirchner, even said in November that Argentina could learn from Brazil. The discovery of oil, he said, “showed the results of a serious investment policy.”
Part of Argentina’s enthusiasm for cooperation stems from the welcoming stance that Brazil’s president, Luiz Inácio Lula da Silva, has taken. Shortly after the Tupi announcement, he asked Petrobras, the Brazilian national oil company, to help explore for oil in Argentine waters. And last year, Argentina and Brazil carried out $24.8 billion in trade with each other, a record amount.
Argentines realize they have made mistakes in the past. While they were pegging their peso to the dollar and rapidly privatizing industries in the 1990s, Brazil was betting early on sugar-cane-based ethanol, creating a huge industry well suited to times of $100-a-barrel oil.
And Brazil was making itself the world’s largest beef exporter. By contrast, Argentina, which in the 1960s controlled 24 percent of global meat exports, saw its protectionist rules cut its share to 4 percent by 2000, according to Dante Sica, director of Abeceb.com, a Buenos Aires economic consulting firm.
Meanwhile, the jarring shifts had another effect: some in the middle and upper classes were enriched, letting them travel more to Brazil, as a devaluation of Argentina’s peso attracted more Brazilians to Argentina. That helped respect between the countries grow.
In the last five years, Argentina has rebounded somewhat from its low point in 2002, when more than half its people fell under the poverty line. But the 20 percent now in poverty are still far from the 1975 level of less than 7 percent. Mr. Kirchner’s government also drew closer to Venezuela, whose president, Hugo Chávez, offered it cheap fuel oil and purchased $4 billion in bonds to help Argentina refinance its debt.
But there is a sense that any new alliance won’t keep Argentina and Brazil from being forever intertwined, and not just economically. Their storied soccer rivalry, for example, was apparently on Mr. da Silva’s mind when he announced in Geneva in October that Brazil would be the site of the 2014 soccer World Cup.
Beaming, he joked that Brazil would hold an event so good “that not even Argentina could find fault.”