Why Argentina’s presidential run-off could rock China’s relations with Latin America

While Sergio Massa won the first round of Argentina’s presidential election, the chance of far-right Javier Milei winning a run-off has dark implications
Milei has advocated a variety of radical positions, including severing ties with China, that threaten to upend Argentina’s economy and diplomacy

Salvador Marinaro

Published: 8:30pm, 26 Oct 2023

Why you can trust SCMP

Shortly after Argentina’s primary election in August, when the far-right candidate Javier Milei’s victory sent shock waves through the political system, I had my annual call with an old schoolmate. After a brief talk about his mother’s health and holiday plans, we delved into the topic dominating national conversations: Argentina’s most unpredictable presidential race in two decades.

This election isn’t solely about domestic policy; it represents a potential shift in Latin American international alignments. The choice between the ruling party’s candidate, Sergio Massa, and libertarian contender Milei goes beyond the presidential seat. It’s a clash of two world views with significant implications for Argentina’s stance towards China.

It didn’t take long for my former classmate to express his support for Milei. Coming from the deeply conservative north, an area divided between traditional landowners and mining ventures, his position wasn’t surprising. What was striking, however, was his employment in the public sector, which Milei has vowed to gut. In the end, he admitted he voted for the candidate to “set the cat among the pigeons”.

This fervour, coupled with the strong backlash against the far-right surge, encapsulates the sentiments many Argentinians held going into the polls last weekend. Surprisingly, the Peronist Massa – a member of the dominant political movement – received 36.6 per cent of the vote on Sunday while Milei maintained his primary election performance of around 30 per cent. These figures pave the way for a run-off on November 19.

In just three months of presidential campaigning, relations with China have become a central issue in political debates, spurred by Milei’s advocacy for severed ties. For the first time, Sino-Argentine relations are under the spotlight, with divided opinions on its role in economic development and national security.

Milei’s explosive rhetoric has thrown Argentina’s political landscape into disarray. His radical proposals range from dissolving the central bank to adopting the US dollar. His belief in the free market extends beyond just the economy. Milei has also supported deregulating weapons and even the sale of human organs.

Presidential candidate Javier Milei addresses supporters as they react to the results of the presidential election in Buenos Aires on October 22. Photo: Reuters

His radical claims have been instrumental in his growing influence. In a country with annual inflation skyrocketing to 138.3 per cent and more than 40 per cent of the population living in poverty, his anger echoes the collective frustration of many Argentinians with the political system.

His statements on international relations are less inventive but equally alarming. He proposed cutting relations with China and supporting Israel. Milei seems to treat global politics like a football match, forcing Argentina to pick sides.

After his unexpected primary win, Bloomberg News featured an in-depth interview with him, marking one of his first appearances in the international media. He expressed interest in leaving the South American trade bloc Mercosur, labelled Brazilian President Lula da Silva a “socialist” and criticised China for its lack of freedoms, saying, “We don’t want to do business with assassins.”

The interview drew concerned responses both at home and abroad. Juan Jose Bahillo, the secretary of agriculture, voiced his dismay during a meeting with directors of Sinograin, one of the top buyers of Argentina’s agricultural exports. Similarly, Massa – the Peronist candidate and current economic minister – stressed the implications of limiting ties with the country’s two major partners, Brazil and China. He asked a gathering of business leaders: “Who is going to buy what we produce?”

Corn is seen at sunset on a farm near Rafaela, Argentina. Argentina’s agricultural exports in particular could suffer if next month’s presidential run-off results in the country cutting ties with China and Brazil, two of its biggest trade partners. Photo: Reuters

The Chinese embassy in Buenos Aires refrained from commenting to the country’s media. Eventually, the response came from the foreign ministry itself. During a press conference, spokesman Wang Wenbin addressed Milei’s remarks, suggesting that a visit to China might lead him to a different conclusion regarding freedom and security.

Milei’s remarks seem to push the country towards an era where ideology dictates diplomatic ties, a position that has not been seen in the country since 1972, when Argentina and China established relations. The past four decades have witnessed consistently warming Sino-Argentine relations, even surviving military dictatorships and three crises. Bilateral trade grew from US$3.2 billion in 2003 to US$19.8 billion in 2021.

Moreover, Milei’s anti-China rhetoric comes at a pivotal moment when ties have been growing steadily. This year, Argentina surpassed Brazil – an economy which is about three times larger – as China’s primary investment destination in Latin America. Buenos Aires welcomed an extension of US$6.5 billion in a currency swap, which was critical in stabilising the Argentine peso.

Outgoing President Alberto Fernandez has fortified Sino-Argentine relations during his tenure. He signed the agreement that officially brought his country into the Belt and Road Initiative. At the latest Brics summit, Argentina was invited to join the bloc as one of six new members. Such partnerships demand enduring diplomatic efforts.

A 100 Argentine peso bill sits on top of several US$100 bills. The Argentine central bank devalued the country’s currency in the wake of Javier Milei’s victory in the presidential primary. Photo: Reuters

In a country accustomed to pivotal shifts between opposing world views, this stance is likely to have intensified the polarisation of diplomatic relations. The influence of figures such as former Brazil president Jair Bolsonaro and former US president Donald Trump adds more layers to Milei’s approach.

Sunday’s results offered momentary relief for the ruling party. However, Milei is likely to seek the endorsement of the Juntos por el Cambio coalition. The party’s right-wing candidate, Patricia Bullrich, received 23.8 per cent of the vote – a segment that could determine the election’s outcome. A lingering question is whether traditionally right-leaning voters will support a maverick such as Milei.

As my old schoolmate highlighted, the country stands at a crossroads. The coming month is set to be one of the most volatile in Argentina’s already turbulent political life. At stake are not just economic policies but also four decades of diplomatic relations that have remained largely conflict-free.

Salvador Marinaro is an Argentine scholar and associate professor at Fudan University