Fernández takes a page from Macri’s playbook in European tour

6th February 2020

By Natalio Cosoy

Fernández takes a page from Macri’s playbook in European tour

Not long ago, the sight of former Argentine president Mauricio Macri at international events next to global leaders was one of the most common images in Argentine politics.

Macri believed courting politicians and business leaders in Europe, North America or East Asia was a crucial part of his search for foreign investment, although in the end his success was limited.

But while Peronists sometimes mocked Macri for this, describing him as weak or subservient, it is now their president, Alberto Fernández, who has been touring some of the world’s biggest powers to try to gain support for Argentina’s upcoming debt renegotiation process.

When dining, meeting and standing side by side with <a href="https://gettheessential.com/politics/2020/01/30/infographic-fernandez-first-foreign-tour-country-by-country">European leaders</a> this week, Fernández looked a lot like his predecessor, who rubbed shoulders with global heads of state and other international leaders often in the hope of gaining their sympathy and backing.</p> <p>That backing will be crucial in negotiations with the International Monetary Fund, where European countries are <a href="https://gettheessential.com/economy/2019/12/05/how-do-imf-internal-politics-play-into-debt-re-negotiation">key stakeholders</a>, and Fernández is also hoping that the Fund might act as an intermediary to help get private bondholders on board as well.</p> <p>Fernández not only met with presidents and prime ministers. He also had discussions with French and German industrial corporations, met international organizations heads, like Qu Dongyu, director general of the Food and Agriculture Organization of the United Nations, economist and best-selling author Thomas Piketty and king Felipe VI of Spain.</p> <p>His meeting with Volkswagen even included a USD 800 million investment announcement by the Government House (also in similar style to Macri’s press team during his years in charge), although it was later revealed that most of that figure consisted of previously-announced investments that were being merely <a href="https://www.cronista.com/economiapolitica/Volkswagen-le-ratifico-a-Alberto-inversiones-por-us-800-millones-en-el-pais-20200203-0031.html">confirmed</a>. Reportedly, Volkswagen told Fernández that lower taxes were needed to improve investment conditions.</p> <h2><strong>A list of supporters</strong></h2> <p>In terms of the amount of support he collected, Fernández’s tour was a success.</p> <p>From <a href="https://gettheessential.com/politics/2020/01/09/pope-francis-alberto-fernandez-cristina-nestor-kirchner-peronism-argentina-mauricio-macri?mc_cid=2f4c11b4b8&amp;mc_eid=f8408e3cc5">Pope Francis</a> to –crucially– Angela Merkel and Emmanuel Macron, everyone said they would back Argentina&#8217;s attempt to renegotiate the terms of its 340 billion debt with private creditors and international financial institutions (USD 44 billion are owed to the International Monetary Fund).</p> <p>The last meeting of his tour, on Wednesday, was with Macron, who said France would help Argentina return to the path of growth together with the IMF. In a shared public statement, Fernández said he had no shame in saying he is pro-European (&#8220;<em>europeísta</em>&#8220;).</p> <img class="wp-image-7770 aligncenter" src="https://gettheessential.com/wp-content/uploads/2020/02/macron.jpg" alt="Alberto Fernández and Emmanuel Macron" width="495" height="278" srcset="https://gettheessential.com/wp-content/uploads/2020/02/macron.jpg 1200w, https://gettheessential.com/wp-content/uploads/2020/02/macron-300x169.jpg 300w, https://gettheessential.com/wp-content/uploads/2020/02/macron-1024x575.jpg 1024w, https://gettheessential.com/wp-content/uploads/2020/02/macron-768x431.jpg 768w, https://gettheessential.com/wp-content/uploads/2020/02/macron-600x337.jpg 600w" sizes="(max-width: 495px) 100vw, 495px" /> <p>On Monday, Fernández had a long working dinner with Germany&#8217;s Chancellor Angela Merkel. She said that her country would try to help Argentina with its harsh economic situation.</p> <p>Probably confused as many others, it was reported Merkel asked Fernández what exactly Peronism was. Fernández replied with a –pragmatic– reference to pragmatism.</p> <p>Fernández also met Spanish and Italian heads of State, but France and Germany were crucial: they are leading Continental economies and together they have around 10% of the vote in the IMF&#8217;s Executive Board, which will have to <a href="https://gettheessential.com/economy/2019/12/05/how-do-imf-internal-politics-play-into-debt-re-negotiation">approve</a> any agreement Argentina reaches with the organization.</p> <h2><strong>How much will it work?</strong></h2> <p>Although Macri’s global tours did not really turn the tide on investment, they likely helped him when he turned to the IMF for a plan B, as his economic program began to show its cracks on May 2018.</p> <p>Macri’s diplomatic team often boasted about how the international rolodex they built ended up playing a part in how the IMF quickly decided to loan money to Argentina, and even expanded the loan shortly after to make it the biggest package in the history of the organization.</p> <p>The IMF went as far as to <a href="https://gettheessential.com/economy/2019/05/02/imf-bends-rules-to-allow-more-central-bank-dollar-sales">bend its rules</a> to help Macri stabilize the country’s currency during election season. In the end, it was not enough for Macri to turn the economic ship around or to win the election, but it did give him an additional option during the crisis.</p> <p>During his trip, Fernández gave a conference at the Paris Institute of Political Studies, commonly known as Sciences Po. It was probably there that the image he wanted to convey during his week in Europe was better summed up, when he declared himself not a conservative or a revolutionary, but a reformist.</p> <p>&#8220;I want to change reality using the established rules,&#8221; he said.</p> <p>Fernández sounded a lot like an European social democrat. The message was intended to change established views on his Peronist party, often seen as an <a href="https://gettheessential.com/politics/2019/09/19/is-fear-of-a-peronist-return-justified-argentina-peronism-peron-history-democracy-authoritarianism">authoritarian threat</a> by foreign observers.</p> <img class=" wp-image-7771 aligncenter" src="https://gettheessential.com/wp-content/uploads/2020/02/sanchez.jpg" alt="Alberto Fernández and Pedro Sánchez" width="467" height="257" srcset="https://gettheessential.com/wp-content/uploads/2020/02/sanchez.jpg 2000w, https://gettheessential.com/wp-content/uploads/2020/02/sanchez-300x165.jpg 300w, https://gettheessential.com/wp-content/uploads/2020/02/sanchez-1024x563.jpg 1024w, https://gettheessential.com/wp-content/uploads/2020/02/sanchez-768x422.jpg 768w, https://gettheessential.com/wp-content/uploads/2020/02/sanchez-1536x845.jpg 1536w, https://gettheessential.com/wp-content/uploads/2020/02/sanchez-600x330.jpg 600w" sizes="(max-width: 467px) 100vw, 467px" /> <p>As for its effect on local politics, Macri’s tour through Europe was playing to his base, which tends to has more of a <a href="https://gettheessential.com/politics/2019/05/02/argentines-views-on-globalization-divided-along-party-lines">positive</a> than a negative impact. Peronists, meanwhile, tend to favor a closer borders development strategy.</p> <p>Yet it does not look like Fernandez&#8217;s core supporters will be very much affected by seeing the President share a few pictures with big capitalist leaders and businesspeople, in a trip that could be merely brushed off as merely ceremonial by his base. For Fernández, however, the trip could be useful in his bid to “end the <em>grieta</em>” between Argentines and seduce (or at least neutralize) the center.</p> <h2><strong>Georgieva and Guzmán size each other up</strong></h2> <p>Meanwhile, on February 5, IMF&#8217;s managing Director Kristalina Georgieva and Argentina&#8217;s Economy Minister Martín Guzmán attended a workshop on inclusion, integration and innovation, organized by the Vatican&#8217;s Pontifical Academy of Social Sciences.</p> <p>In the meeting, Pope Francis quoted pope John Paul II, who in 1991 had said that although the principle that debts must be paid is fair, &#8220;it is not right to demand or expect payment when the effect would be the imposition of political choices leading to hunger and despair for entire peoples.&#8221;</p> <p>In those cases, John Paul II said (and Francis quoted), &#8220;it is necessary to find [&#8230;] ways to lighten, defer or even cancel the debt, compatible with the fundamental right of peoples to subsistence and progress.&#8221;</p> <p>(The Pope had already told Fernández he was worried about Argentina&#8217;s debt crisis when they met in the Vatican last Friday.)</p> <img class=" wp-image-7772 aligncenter" src="https://gettheessential.com/wp-content/uploads/2020/02/francis.jpg" alt="Alberto Fernández and Pope Francis" width="451" height="293" srcset="https://gettheessential.com/wp-content/uploads/2020/02/francis.jpg 1200w, https://gettheessential.com/wp-content/uploads/2020/02/francis-300x195.jpg 300w, https://gettheessential.com/wp-content/uploads/2020/02/francis-1024x664.jpg 1024w, https://gettheessential.com/wp-content/uploads/2020/02/francis-768x498.jpg 768w, https://gettheessential.com/wp-content/uploads/2020/02/francis-600x389.jpg 600w" sizes="(max-width: 451px) 100vw, 451px" /> <p>Georgieva and Guzmán, sitting side by side, listened to the Pontiff.</p> <p>Following on the Pope&#8217;s lead, Guzmán insisted on Argentina&#8217;s need for a sustainable debt structure, and added that his government does not believe that fiscal discipline should be imposed to pay creditors if that is going to damage development and affect the poor.</p> <p>Georgieva said that if Latin American countries wanted to scale up social spending they would have &#8220;to boost the efficiency of spending.&#8221; Her 2400-word-long speech did not include the words &#8220;debt&#8221; or &#8220;credit&#8221; – neither did she mention Argentina.</p> <p>The day before, Georgieva and Guzmán had met in Argentina&#8217;s embassy in Rome. They did not give much away, barely saying the encounter was &#8220;constructive&#8221; (Guzmán) and &#8220;productive&#8221; (Georgieva).</p> <p>Fernández&#8217;s tour of Europe was a follow up to his visit to <a href="https://gettheessential.com/politics/2020/01/30/alberto-fernandez-first-international-tour-israel-imf-vatican-europe-russia">Israel</a> and the Vatican. In both places he received statements of support regarding Argentina&#8217;s debt problem.</p> <p>But to solve it, Fernández and his government will first have to convince private creditors that their offer is worth it. And then gather as much –or even more– support from the United States as they did from Europe, the country with more leverage in the IMF.</p> <p>

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Natalio Cosoy

Natalio Cosoy is the Argentine correspondent for France 24 in Spanish and has worked for the BBC, the Deutsche Welle and the Washington Post.