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AMERICAS, THE, Argentina

Date Posted: 11-Feb-2015


Jane's Defence Weekly

Analysis: China looks to break into Latin


American market via Argentina
Richard D Fisher Jr
Washington, DC
Sino-Argentine military relations appear to be deepening, and although Argentina may
lack funding for a variety of new equipment, it could still help open the door for
Chinese exports in Latin America, writes Richard D Fisher Jr

ANALYSIS
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.
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 P18N 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 IHS Jane's 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

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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.

Argentina could become a local marketer for China's VN1 APC. (Norinco)
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