Since Mauricio Macri was elected president in 2015, the world has changed significantly. Then, the United States was led by Barack Obama, Brexit was not even a word in the dictionary and the leader of China was not entitled to eternal re-election. There was no trade war and multilateral institutions seemed to be working – they were even making some sense.
Macri thought the reputational push given by his ascension to power would boost the country’s economy by default – not to default. It did not quite work out that way.
The president’s approach scored a couple of major foreign policy goals, beyond the photo-op of the G20 Leaders Summit in Buenos Aires in 2018. First and foremost, the mammoth US$57-billion loan that the country obtained from the International Monetary Fund (IMF), under a stand-by programme that was amended on three occasions and that is still underway. Secondly, the free-trade agreement between the Mercosur trade bloc and the European Union, signed despite the questionable reputation of Brazil’s new president Jair Bolsonaro, another international novelty of recent years.
But global politics and economics move to a different tune these days, other than reputation. Argentina descended into a major economic crisis starting April 2018, even as the country was gearing up to host the G20 summit and Macri had already gained an international reputation as a pro-market, pro-reform leader who brought a certain equilibrium to an increasingly unstable region.
Last Sunday’s debate, the strict format of which will be replicated tomorrow but with different topics, had an entire section about international relations. In his presentation, Macri repeated his foreign policy manifesto pledge: “I personally devoted myself to building personal relations of trust with world leaders, which allowed us to preside over the G20… We have proven that the world is an enormous opportunity for us.”
In the other corner, Frente de Todos frontrunner Alberto Fernández showed a different type of naïveté in his comments about foreign policy. “We all know that globalisation is here to stay, and we all know that we have the challenge of facing up to globalisation… Our first obligation as a country is to unite Latin America and to potentiate the Mercosur again.”
Fernández’s line seems extracted from 2003 – and even then globalisation was not a novelty. Shortly after Néstor Kirchner took office that year, Argentina teamed up with Luis Inácio Lula Da Silva’s Brazil and Hugo Chávez’s Venezuela at the Summit of the Americas in Mar del Plata to kill off Washington’s plans to create a free-trade region for the Americas. The move made sense for a while. It came during the commodities boom sparked by China’s hungry consumption, which fuelled the region’s economies and, critics would say, a wave of populism whose sole survivor now is Bolivia’s Evo Morales, who is seeking a fourth term in office tomorrow.
But over the long haul, looking at the twist of global events retroactively, was that the right thing to do? After 2005, Washington retreated, while China advanced in a region that has failed to agree to a joint pivotal approach to the new geopolitical scenario. Now each country seems to be playing its own isolated game, and the Mercosur’s agreement with the EU – the final approval and implementation of which will be put to the test inside a handful of European parliaments and by Fernández, if he does become the president of Argentina – is only the exception that confirms the rule.
With the global economy decelerating – the IMF this week pushed down global growth projections to three percent this year – and the ensuing trade war, Argentina will not be able to count on an external push to help with its delicate situation. Only one positive factor is expected to remain in the coming months and years: low international interest rates, which may come handy when the next government sits down with investors to renegotiate the debt.
Yet a navel-gazing campaign and the overwhelmingly local political discussion has prevented the main candidates and their teams from following the larger world picture around them. More photo-ops will not produce investment downpours in Argentina. And Bolsonaro’s Brazil will not help to revive an already moribund Mercosur, at least in the sense that Fernández would like it to be revived. A new picture requires new ideas.
The políticos are not the only ones to blame. The country’s top business leaders gathered in the city of Mar del Plata this week for the annual IDEA gathering, only to produce a number of goodwill platitudes about how the country needs to reach “consensus,” but without detailing what exactly the consensus would actually be about. Last year, the slogan of this group’s powwow was “Cultural change: it’s us and it is now” – a near pro-Macri government mantra. This year after the August PASO primary result, they tried to quickly adapt to the local political times and filled their programme with calls for spiritual unity.
Not a single panel discussed the
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