Economy Politics

Trump praises Fernández, but clash with Bolsonaro intensifies

7th November 2019

By Ignacio Portes

Trump praises Fernández, but clash with Bolsonaro intensifies

Argentines are getting to know what an Alberto Fernández administration might look like, and the first few days after his win are showing some surprises regarding his relationship with Argentina’s largest partners.

Few would have expected a Peronist government to be in better terms with the United States than with its neighbor Brazil, but this now seems to be the case, as US President Donald Trump showed signs of friendliness with Fernández while tensions with Jair Bolsonaro continue to escalate, now including economic threats and a growing conflict over imprisoned former president Lula da Silva.

</p> <h2><strong>One chat, two versions</strong></h2> <p>Earlier this week, Trump called Fernández to congratulate him over his victory, saying that Fernández will &#8220;do a great job&#8221; and that he &#8220;hoped to meet him immediately. Your win has been talked about all over the world,&#8221; the US President said.</p> <p>According to Fernández&#8217;s spokespeople, Trump went as far as saying that he &#8220;<a href="https://www.infobae.com/politica/2019/11/01/donald-trump-llamo-a-alberto-fernandez-para-felicitarlo-por-su-triunfo-electoral/">instructed the IMF</a> to work with you. Don&#8217;t hesitate to call me.&#8221; Those words suggested that the crucial support of the US during negotiations over Argentina&#8217;s massive 50-billion dollar bailout during outgoing President Mauricio Macri&#8217;s administration might continue during Fernández&#8217;s term, a fact that many would have been skeptical of given Trump&#8217;s excellent relationship with Macri.</p> <p>But an analysis from White House reporters in the US suggested that Trump&#8217;s words might not have been as strong as Fernández&#8217;s camp claimed.</p> <blockquote class="twitter-tweet" data-width="550" data-dnt="true"> <p lang="en" dir="ltr">So, Argentina said that Trump said he had asked the IMF to work with Argentina.</p> <p>Trump&#39;s statement just said that he &quot;expressed United States support for helping [Argentina] overcome economic challenges.&quot;</p> <p>&mdash; Josh Wingrove (@josh_wingrove) <a href="https://twitter.com/josh_wingrove/status/1190426909190041603?ref_src=twsrc%5Etfw">November 2, 2019</a></p></blockquote> <p><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script></p> <p>Trump&#8217;s statement merely spoke about helping Argentina with its economic challenges, with no mention of the International Monetary Fund, leaving the rest up to speculation. Was the IMF mentioned during the 10-minute talk, but ignored in the statement? Or did Fernández&#8217;s camp overplay Trump&#8217;s words?</p> <h2>The US and Peronism</h2> <p>In any case, outside observers should not be shocked to see the US and a Peronist Argentine president in friendly terms, as counter-intuitive as that might seem.</p> <p>Although Peronism was founded amid strong anti-US sentiment, with the famous 1945 campaign slogan of &#8220;(US Ambassador Spruille) Braden or Perón&#8221; still resonant in contemporary Argentine culture, and even though Cristina Kirchner also made use of strong anti-US rhetoric during the last few years of her presidency, the party has also been close with the world&#8217;s largest superpower during long periods.</p> <p>The most obvious example is that of Carlos Menem&#8217;s presidency, the &#8220;neoliberal Peronist&#8221; who oversaw strong pro-market reforms and whose foreign minister Guido Di Tella famously spoke of &#8220;carnal relationships&#8221; between both countries. But it is far from the only case.</p> <p>Perón himself was often on better terms with US Republicans than with Democrats, turning to Dwight Eisenhower during the 1950s as Argentina opened up to foreign investment. US foreign policymakers had an ambiguous relationship with the Argentine leader, who they saw as positive to contain communism despite all their historical clashes.</p> <p>During Néstor Kirchner&#8217;s administration, diplomacy was more mixed, as the alliance of local industrialists with Venezuela&#8217;s Hugo Chávez to stop the FTAA free trade agreement sought by George W. Bush led to significant animosity, but the Argentine government steadily backed the US in all of its positions on the middle east, including <a href="https://gettheessential.com/politics/2019/07/18/macri-points-finger-at-iran-25-years-after-amia-bombing">focusing on Iran</a> as the alleged perpetrator of the bombing of the Israeli Embassy in Argentina in 1992 and the AMIA Jewish Center in 1994. That alignment broke down during Cristina Kirchner&#8217;s years in charge, but Alberto Fernández was one of the strongest <a href="https://gettheessential.com/politics/2019/05/23/who-is-alberto-fernandez">critics</a> of the decision, so a new turn should not come as a surprise.</p> <p>Fernández&#8217;s ally Sergio Massa is perhaps the most prominent US-friendly politician among the incoming Peronist coalition. His ties to the US include Trump&#8217;s lawyer Rudy Giuliani, and his strong stance against Venezuela, which he has repeatedly described as a dictatorship, has made him a reliable US ally. Massa has been in talks with US representatives over the last few weeks to secure their support for Fernández.</p> <h2>Clash with Bolsonaro</h2> <p>The same cannot be said of Argentina&#8217;s relationship with Bolsonaro&#8217;s Brazil, the strongest Trump ally in the region, which has continued to deteriorate.</p> <p>The most recent episode came on Wednesday, when the Brazilian head of state <a href="https://economia.estadao.com.br/noticias/geral,bolsonaro-apaga-tweet-apos-honda-loreal-e-mwm-negarem-transferencia-da-argentina-pro-brasil,70003078548">tweeted out</a> that firms MWM, Honda and L&#8217;oreal were all exiting Argentina and moving into Brazil given the neighboring country&#8217;s highest business trustworthiness and its ambitious economic reforms.</p> <p>But the firms quickly came out against the rumors, with L&#8217;oreal saying that &#8220;we are not planning to close our operations, in fact we want to increase local production&#8221; and Honda saying it would continue to manufacture motorcycles in the country. MWM was the only firm to remain silent.</p> <p>Bolsonaro deleted the tweet shortly after.</p> <p>Late last night, however, he stroke back by posting a video of an Argentine analyst on Argentine TV praising Brazil&#8217;s economy over that of his own country.</p> <blockquote class="twitter-tweet" data-width="550" data-dnt="true"> <p lang="pt" dir="ltr">a imprensa argentina e a nossa economia. Link no YouTube: <a href="https://t.co/Rbv5TL94a5">https://t.co/Rbv5TL94a5</a> <a href="https://t.co/LX08TdL1Yv">pic.twitter.com/LX08TdL1Yv</a></p> <p>&mdash; Jair M. Bolsonaro (@jairbolsonaro) <a href="https://twitter.com/jairbolsonaro/status/1192225819743137792?ref_src=twsrc%5Etfw">November 6, 2019</a></p></blockquote> <p><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script></p> <h2>Mercosur matters</h2> <p>Bolsonaro <a href="https://gettheessential.com/politics/2019/06/06/bolsonaro-macri-brazil-argentina-reelection">explicitly supported Macri</a> during the campaign, and has not congratulated Fernández on his win, saying Argentines &#8220;made the wrong choice&#8221; in the election. He has also confirmed that he will not be traveling to his inauguration.</p> <p>Although some might wonder if the differences between Trump and Bolsonaro regarding Fernández amount to a good cop-bad cop routine on Argentina, it is likely that Fernández&#8217;s explicit support for former president Lula, who is currently in jail, explains the vitriol of the recent statements. Bolsonaro&#8217;s son has now called for Congress to <a href="https://www.clarin.com/politica/hijo-bolsonaro-apoya-mocion-repudio-alberto-fernandez-congreso-brasil_0_F44gQRs3.html">condemn Alberto Fernández</a> for interfering in Brazilian affairs due to his words on the Lula case.</p> <p>But there&#8217;s also a radically different economic vision of the future lurking beneath the surface. Bolsonaro was happy with Macri by his side as he saw him as an ally to shift the protectionist Mercosur trade bloc in a more pro-market direction, signing an <a href="https://gettheessential.com/economy/2019/07/04/mercosur-european-union-eu-trade-deal">agreement with Europe</a> earlier this year and looking for more in the coming months.</p> <p>With Fernández now in charge, the progressive liberalization of the Mercosur is now in question. But Bolsonaro still has one card up his sleeve: breaking from the Mercosur completely, and moving on with his own trade agreements on a bilateral basis. It&#8217;s a card that he has still not dared to play.</p> <p>

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Ignacio Portes

Ignacio Portes is The Essential's General Editor. Former Economy editor at the Buenos Aires Herald, he has also written for publications such as Naked Capitalism, NSFWCorp and Revista Debate.